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The hidden price of free returns


Retail is becoming increasingly digital, with businesses employing technology, often to reduce costs, in the interface between brand and customer interactions, [1] and customers turning to online shopping as a means of convenience. One of the main issues related to online shopping is the hesitation that derives from the failure of identifying the correct sizing and inability to visualise the fit. In fact, the clothing retail industry has been experiencing a high number of returns [2]; just in Europe, the cost of return deliveries amounted to US $381.8 billion [3]. Aside from these monetary costs, there are also significant environmental costs that should not be ignored.

Research has found that flexible returns is one of the main aspects consumers look for when choosing from which website to purchase from [4] and flexibility of returns mainly means free returns. When customers are unsure about which size to purchase, they tend to buy multiple items, try them on at home, and then send back what they don’t like for free and receive a refund.

While this sounds ideal, it is important to note that in this process the climate is particularly impacted in the logistics stage [5]. Courier trucks, planes and other are employed to return the item from the customer back to the retailer. A single item using a courier emits 181g of CO2, when being returned. Worldwide, approximately 17 billion items are being returned every year, which totals to 4.7 million metric tons of CO2 emitted yearly [6].

Consumers seek convenience and retailers to satisfy customers; however, it does not mean that the environment should be taken out from this relationship. Next time you are online shopping filling in baskets with items you are unsure about, try avoiding making impulsive decisions, think twice about what you really want and make sure you are confident about your choice before clicking purchase. The environment, your favourite retailers and your future self will be grateful.


Di Eleonora Romanò


Sources:

[1] van Doorn, J., Mende, M., Noble, S. M., Hulland, J., Ostrom, A. L., Grewal, D., & Petersen, J. A. (2016). Domo Arigato Mr. Roboto. Journal of Service Research, 20(1), 43-58. doi:10.1177/1094670516679272

[2] Duarte, P., Costa e Silva, S., & Ferreira, M. B. (2018). How convenient is it? Delivering online shopping convenience to enhance customer satisfaction and encourage e-WOM. Journal of Retailing and Consumer Services, 44, 161-169. doi:10.1016/j.jretconser.2018.06.007

[3] Statista. (2019 ). Costs of return deliveries worldwide in 2015 and 2019 (in billion U.S. dollars). Retrieved from https://www.statista.com/statistics/753437/return-deliveries-costs-region/

[4] Romano, B., Sands, S., & Pallant, J. I. (2020). Augmented reality and the customer journey: An exploratory study. Australasian Marketing Journal (AMJ).

[5] Forbes. (2019). There Is No Such Thing As A Free Return. Retrieved from https://www.forbes.com/sites/gulnazkhusainova/2019/03/28/there-is-no-such-thing-as-a-free-return/?sh=36b1259a7135

[6] Edwards, J. B., McKinnon, A. C., & Cullinane, S. L. (2009). Carbon auditing the ‘last mile’: modelling the environmental impacts of conventional and online non-food shopping. Green Logistics Report, Heriot-Watt University.