Over eight in ten (84%) online shoppers would stop using a retailer after a bad returns experience. That’s according to new research from Klarna, which highlights the power of returns as a customer acquisition and retention tool – and the repercussions of getting them wrong.

39% of consumers have done more shopping online since the pandemic. However, increased reliance on returns means people’s patience is waning when it comes to ineffective or costly returns processes. 83% of online shoppers admit to getting frustrated by retailers that have an inefficient returns process, while 82% agree that retailers, in general, need to improve their returns capabilities.

Consumers’ changing needs

Some of Brits’ biggest frustrations with returns stem from the inconvenience of slow, out of date, or inflexible returns processes. Over a third cited slow refund processes as the most frustrating element of returning items bought online; therefore highlighting the importance of flexible payment options.

Other frustrations include having to print off return forms when they don’t have a printer (25%); the inconvenience of queuing to return at the post office (23%); and not being able to return items in-store that they’ve bought online (21%).

These frustrations are the driving force behind emerging shopping trends

Over the past 12 months, a fifth (21%) of online shoppers say they have reluctantly kept an item they were unhappy with because it was too much effort to return it. Plus, 12% avoided returning items at the post office because it’s difficult to social distance.

Meanwhile, 11% have gifted and 9% have resold items they don’t want instead of returning to the retailer. In the long run, this could mean people avoid buying again from retailers that don’t meet their needs.

Getting the returns experience right can offer a competitive advantage, helping attract new customers and boost customer loyalty

84% of online shoppers agree they’re more likely to buy from and 86% are more likely to come back to online merchants who offer free returns. However, even a little added inconvenience can come at a cost. Over two-thirds (70%) of online shoppers state if a preferred retailer stopped offering free returns, they might not shop with them.

Commenting is Alex Marsh, head of Klarna UK. “Nobody wants to be out of pocket as a result of items they don’t even choose to keep. So, it’s no surprise that slow refund processes are the top frustration factor when it comes to returns.

“As reliance on returns grows, retailers need to ensure they’re offering a smooth, seamless process that meets the needs of today’s customers; considering everything from effortless logistics to flexible payment options. As our research suggests, those that fail to adapt will lose customers in the long term.”

The research also uncovers a consistent trend of rising consumer expectations when it comes to returns services

In comparison to 2019, a greater number of online shoppers now believe returns are a normal part of online shopping today (80%, up from 77%). Plus, they expect every retailer they shop with offers free returns as a minimum standard of service (81%, up from 75%).

And, as customers increasingly demand free and easy returns, more consumers also now state they’d never shop with a retailer that didn’t offer free returns (57%, up from 53%). Also, that all their preferred retailers offer free and easy returns (73% up from 70%).

Natalie Berg, retail analyst and founder of NBK Retail, says; “Consumers often expect a returns policy to mirror that of delivery – fast, frictionless and free – but that’s not always the case. The pandemic has thrust the issue of returns into the spotlight; exacerbating the disconnect between the effortlessness of placing an online order and the inconsistent and often friction-filled experience of making a return. Returns are fantastically out of sync with an otherwise seamless ecommerce experience.

“As we reimagine retail for a post-Covid world, retailers must accept that returns are part and parcel of 21st century shopping. And, if managed well, can encourage conversion and drive loyalty among their most valuable shoppers. Retailers can no longer afford to ignore the post-purchase experience.”