Reducing Returns with User Generated Content
November 13th, 2008 by Sam Decker | Chief Marketing Officer“Retailers are expected to see the value of merchandise returned in 2008 increase a whopping 23% to reach $219.1 billion, fueled in large part by a combination of shaky consumer confidence and retailers’ desire to develop shopper loyalty with flexible return policies, according to a new report by the National Retail Federation” reported in Wall Street Journal
Wow. This is huge. As marketers we mostly focus on the topline and margin mazimization, but when returns are expected to go up 23% that cuts to the bottom line in tough times.
Our applications, such as Ratings & Reviews and Ask & Answer, are mostly focused on helping drive traffic, conversion, average order value. However, we are pleased to announce that User Generated content can reduce returns. Reducing returns will be a strategic priority for your CFO this year, and obviously maintaining customer satisfaction and loyalty to retain customers.
So, I’ll point you to two case studies showing how both Ratings and Reviews and Ask & Answer have reduced returns for two major retailers. It makes sense…a customer more researched, thoughtful and invested in their purchase will be more likely to retain their purchase.
- Customer Q&A leads to 23% decrease in product returns
Automotive parts marketer JCWhitney found that Ask & Answer reduced product return rates in 80% of their products with more than 20 questions/answers. - Reviews reduce product returns 20%
PETCO found that products with reviews have lower return rates, and those with more reviews have even fewer returns.
