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Returns in e-commerce are a huge problem: Here’s how chatbots can help you solve it!

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If you're running an e-commerce business, you're most likely struggling with a high number of returns. In fact, the average consumer returns up to 30 percent of the items they buy online. As an e-commerce company, these returns cost you money and time. Did you know that chatbots can help you solve this problem?

The shoes are too big. I bought the wrong gift for my wife. I ordered multiple items to compare and return what I don’t like. The product isn't what I expected. There are issues with the item. As an e-commerce company, you've heard them all: the multiple reasons why customers return an item.

While understandable, handling these multiple returns increases your costs and lowers your margins. And it’s not an isolated problem. It’s an issue that almost all e-commerce businesses face.

The double challenge for e-commerce: free returns eat your profits, but customers expect them

Due to the nature of online shopping, e-commerce businesses see much higher return rates than brick-and-mortar stores. According to some estimates, online stores can see return rates as high as 30%, compared to 9% at brick-and-mortar stores.

Even though, due to their products, some industries, such as apparel or electronics have a higher return rate than others, all e-commerce companies are affected by high return rates.

e-commerce return rates benachmark report
All e-commerce industries are affected by returns. (Source: Shippo)

Dealing with returns and exchanges adds to your costs, and cuts into your margins. The cost of processing a return item ranges between US$ 25.75 and US$ 45.25. 

At the same time, customers have come to expect easy and free returns when they shop online. In fact, an easy and free return process is the main incentive for customers to buy from an online store.

According to an industry report by Walker Sands, free shipping (79%), free returns and exchanges (54%), and an overall easier return process (36%) are the main reasons that make it more likely for a customer to shop online.

customer expectations e-commerce returns
Easy and free returns are a major incentive to shop online. (Source: Walker Sands)

Meeting your customers’ expectations, making shopping at your online store more attractive to consumers, and growing your business while at the same time trying to keep your return costs from eating your profits, is therefore a very delicate balancing act.  

However, instead of just looking at returns as lost business, you can take them as an opportunity to increase customer loyalty and even drive purchases — and chatbots can help you with that! They can not only reduce your return rates, but also increase customer loya