Commerce protection provider, Signifyd, unveiled its latest data on European consumer return trends, revealing a crucial consideration for retailers in today’s evolving economic landscape.
The research, conducted by OnePoll across Europe in February 2024, highlights a key insight: while inflation may be easing, cost-conscious consumers prioritise retailers offering flexible return policies and payment options. This underscores the importance of going beyond the ‘buy now’ button and focusing on the entire retail life cycle, from delivery to return.
With returns globally costing retailers more than US$700 billion in 2023 and projected to cost nearly US$1 trillion by the end of the decade, retailers need innovative strategies to manage the process effectively. Beyond the rising cost of legitimate returns, any future-focused strategy must account for fraudulent returns. The challenge is growing rapidly, given that the adoption of SCA has made traditional payments fraud more difficult.
Key findings:
- Return policies drive buying decisions: 76% of European consumers consider return policies fairly or very important when choosing a retailer, with Italy and Spain placing the highest value on this factor (48% and 47% respectively saying ‘very important’)
- Ease of return is paramount: 94% of respondents find ease of return crucial, with a majority stating they’d be less likely to shop at a retailer offering only store credit (50%) or charging for return costs (57%)
- Preferred return methods vary: the top three preferred return methods are courier collection (35%), Post Office drop-off (32%) and in-store returns (26%), with return bars being the least popular (7%). Notably, British and Spanish consumers favour in-store returns the most (both at 34%).
- Common reasons for return rejection: The most frequent reasons for rejected returns include exceeding the return window (13%), damaged items (12%) and returning products excluded from the policy (9%).
- Payment preferences differ geographically: Over half of Italians (55%) and Spaniards (53%) prefer PayPal, while 55% of Britons favour credit cards.
The research conducted serves as a warning to European retailers not to rely on customer experience ending with the purchase; instead, they need to account for the full retail lifecycle through delivery and possession.
Amal Ahmed, Director, Financial Services and EMEA Marketing at Signifyd, said: “Our research highlightsthe complexities retailers face in today’s evolving consumer landscape. While offering a seamless and customer-centric experience throughout the retail journey remains crucial, including efficient and flexible return options, it’s equally important to implement robust fraud prevention strategies to address the growing challenge of fraudulent returns.
“By adapting to changing consumer expectations and prioritising both customer satisfaction and security, retailers can thrive in this dynamic environment.”