Connect with us

News

REVOLUTIONISE RETURNS: 78% OF SHOPPERS WILL BUY MORE IN THE LONG-RUN IF A RETAILER HAS FREE RETURNS

– 86% of shoppers say free returns will make them more loyal and encourage repeat visits 

– Increasing issues with fit, quality and appearance of online products driving up returns 

 

Retailers who don’t offer an easy returns process are losing sales and customer loyalty, with 84% of shoppers saying they won’t come back to a brand if they have a poor returns experience.

 

The research conducted by Klarna across 2,000 UK consumers in 2019 – and compared with the same data points from 2017 research – reveals the rapid normalisation of returns over the last two years. The majority of consumers (82%) say returns are now a normal part of online shopping, and with online sales hitting a high of 20% of all retail sales in December 2018*, this growth in returns can’t be ignored.

 

Returning returners: harnessing the loyalty bounce

Done right, returns can be a driver of loyalty and increased customer lifetime value, and retailers who don’t embrace the rise in returns culture could see customers snapped up by more dynamic competitors:

  • Three quarters (75%) say easy returns are an essential factor in their choice of retailer
  • Over three quarters (78%) said free returns mean they would buy more with a retailer over time
  • 86% say the option of free returns will make them loyal and more likely to keep coming back to a brand

 

Retailers offering flexible returns and payment options are more likely to steal a march on competitors: 84% of shoppers want to be able to choose whether to return an item in-store or via post or pickup, and a third (31%) would be more likely to buy something online if they had the opportunity to pay for it after trying it at home.

 

From URL to IRL: false expectations and the reality check effect

The volume of online items being returned has climbed 14% in two years and this rise is being exacerbated by a growing gap between what customers see online and the reality of what they receive in real life:

  • Consumers returning faulty items has more than doubled between 2017 and 2019 (12% to 26%), and nearly quadrupled for items in cases where the quality didn’t meet expectations (from 6% – 22%)
  • Nearly a third of shoppers (27%) return items because the fit isn’t right and returning items because the product looks different online than in reality has more than doubled since 2017 (8% to 19%)

 

The findings indicate that if retailers wants to reduce their online returns, they should look to improve their online product representations with 81% of shoppers saying that better photos and descriptions would help reduce the ‘false expectations effect’ and consequently the amount they return.

 

Luke Griffiths, UK General Manager, Klarna, said: “It’s no secret that for retailers, returns can be difficult to manage and there is a common misconception that they’re bad for business. But retailers who aren’t prioritising their returns processes are damaging their business – losing sales, and eroding customer loyalty.

 

By embracing returns as a competitive differentiator, online retailers can stand out from the crowd with “pay after delivery’ – allowing their customers to turn their sitting room into a fitting room. Over a quarter of respondents (26%) said this would make them trust a retailer more and 63% said it would encourage them to keep more items, helping build a relationship with customers and secure long-term loyalty.”

 

Paul Masters, COO of InTheStyle said: “Many of our customers are frequent buyers and like to experiment with different looks and sizes at home, particularly with our new collections. So, as with all e-comm fashion businesses, we’ve built returns into our core business model.

 

And to give our customers the flexibility and freedom to try pieces from our latest collections before committing to a purchase – just like you would in store – we introduced Pay later. Any concerns we had about the rise in returns this would create have been offset by an increase in purchase frequency, basket values and customer loyalty.

 

Our customers are buying more, trying more and loving even more. And as a result we’ve seen a 31% increase in average order value when shoppers use Pay later and a massive 47% increase in order frequency compared to other payment methods. In a competitive market it’s not only helping us drive sales from our existing client base, it’s become a powerful acquisition tool for converting new shoppers.”

 

Tim Robinson, Doddle CEO said: “Returns are a huge headache for retailers but they’re not going away.  For many online shoppers, they’re a right and necessity – the online equivalent of the pile of clothes you used to hand back to the shopping room assistant in store.

 

As a retailer, once you take this as the context, the focus changes. Returns become just another cost in the online supply chain, like packaging or shipping costs, and rather than being a problem that needs to be solved the focus turns to optimisation and efficiency.”

 

Download our full report – Rethinking Returns 2: the new norm that’s here to stay – here: https://www.klarna.com/uk/wp-content/uploads/sites/11/2019/03/6310-KLA-Re-thinking-Returns_10pp_A4_WEB-11.03.19-1.pdf

https://www.ons.gov.uk/businessindustryandtrade/retailindustry/timeseries/j4mc/drsi

 

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

News

ERSTE BANK HUNGARY IMPROVES AND SECURES THE REMOTE BANKING EXPERIENCE WITH ONESPAN MOBILE SECURITY

ONESPAN

Leading Hungarian bank deploys OneSpan’s Mobile Security Suite to one million customers to make mobile banking convenient while fighting fraud and meeting PSD2 requirements

 

OneSpan™ (NASDAQ: OSPN), the global leader in securing remote banking transactions, today announced that Erste Bank Hungary, a subsidiary of Erste Group Bank AG, one of the leading banks in Central and Eastern Europe, has integrated OneSpan’s Mobile Security Suite into its banking app MobilBank. Erste Bank Hungary selected Mobile Security Suite to enable and protect online and mobile transactions and to comply with PSD2 requirements for authentication and dynamic linking.

The European Payment Council has stated that social engineering attacks continue to increase and remain instrumental in fraud schemes, often in combination with malware.[1] Erste Bank Hungary chose to implement OneSpan’s Mobile Security Suite to protect against potential social engineering and malware attacks directed at its customers. OneSpan’s technology enables banks to integrate application shielding, biometric authentication and transaction signing.

Erste Bank Hungary added Mobile Security Suite’s Cronto visual transaction signing to replace the bank’s SMS authentication with push authentication for login and transaction signing. This new process improves security and eliminates significant costs related to SMS delivery. OneSpan’s Cronto technology also helps fight social engineering attacks like phishing, while enhancing the customer experience by  enabling transaction signing using a color QR code.

“OneSpan’s proven technology will help us maintain our leading position in the market without compromising on security or the customer experience,” said Erste Bank Head of Digital Services, Akos Andras Molnar. “As part of this roll-out, our customers can also make online purchases using push notification with any retailer connecting to Erste Bank via the 3-D Secure protocol.”

“Criminal hackers continue to target banking customers as social engineering remains a preferred technique,” said OneSpan CEO, Scott Clements. “In their search for security solutions, banks need to consider cost, convenience and regulatory compliance. OneSpan’s technologies address these concerns so that banks can focus on providing a secure and convenient customer experience.”

Continue Reading

News

HOW WILL LENDERS TREAT THE FINANCIAL SYMPTOMS OF COVID19?

FINANCIAL

COULD the coronavirus pandemic spark a financial crisis similar to that which was seen in 2008? Tim Kirby, Group Commercial Director of the global fintech Monevo, a personal lending marketplace and platform, discusses how Covid-19 could play out for lenders.

The 2008 financial crisis, explains Kirby, was about credit over-exposure. While strains are apparent in the money markets today, it is not 2008, when risky mortgage investments in the US banking sector and into the UK caused everything to collapse.

Kirby said: “The financial crash was self-inflicted for many reasons, including poor income verification, poor credit quality assessment and poor employment verification (self-certification). It was asset-backed predominantly as it was led by sub-prime mortgage lending.

“My thoughts are that once the virus is contained, the economy will most likely turn back on within a few months, however recovery to current levels will be somewhat longer.”

Kirby predicts that it is very possible this downturn will be shorter than the 2008 financial crisis based on a number of factors.

He said: “The financial crash was either at a house purchase level or encouraging debt consolidation through re-mortgaging that placed unsecured debt into secured debt over a longer term. The consumer then ramped up unsecured debt again with the same poor assessment applied and eventually ran out of headroom.

“This was propped up by the capital markets and warehouse funding lines being supported through securitisation models that rated the loans held in the bonds as AAA.”

Kirby adds that the coronavirus outbreak is more micro and consumer-led than the recession was.

“There is still a great deal of uncertainty, but consumers are certainly going to experience affordability difficulties in the short-term, perhaps three to six months,” Kirby explains. “Lenders are already tightening their criteria and that could lead to more tactical initiatives being introduced.”

Kirby points to the potential introduction of black-listing certain occupation types most affected, and reducing opening balances to applicants that they are most prepared to lend to.

He said: “At Monevo, we have been speaking to lenders who are predicting a 50% slow down, with some pausing to assess short-term strategies, as clearly there are aspects of credit / risk scorecards that aren’t working at the moment.”

Kirby also adds that access to capital markets will be a challenge in the short term: “Lenders who don’t lend off balance sheet may become constrained and you would have to question the Peer-to-Peer lender impact as the returns and appetite of investors could be under threat.”

“Additionally, those lenders nervous about funding certain cohorts of consumers, now have those very same consumers currently in their loan books.

“So, for lenders, focussing on forbearance and other support activity to protect these consumers in the short term of 3-6 months, will be a priority.

Kirby takes the view that it is important lenders relieve some repayment pressure from consumers in the short term, so they can rehabilitate when the new normal arrives.

“Lender feedback in the last week is that they haven’t seen a massive increase in defaults, it’s very early days though. Anecdotal feedback from lenders that are strong and well-funded is that they expect strong growth when the market returns, and that those who are optimised and agile will see an upswing.

“What I am hearing, is that consumers will remedially seek liquidity through debt, as the world normalises to address the short-term pain being experienced at present.”

Kirby adds that lenders who look at credit risk closely when the upturn comes in three to six months could see dramatic growth, albeit from a reduced base.

He added: “From Monevo’s perspective, day trading is difficult to predict and lenders are re-assessing short-term strategies.  We are using the time at present to apply additional focus on our internal tech pipeline in driving the product development roadmap forward to continue to deliver great solutions for our partners.

“We want to ensure when normality returns and the upswing in both demand and supply inevitably happens, that we are supporting our origination partners and the lenders on our panel as effectively as possible.”

 

Continue Reading

Magazine

Partner Events

Trending

Top Stories5 hours ago

ENTERPRISE BLOCKCHAIN: DRAGGING INSURANCE OUT OF THE DARK AGES

Ryan Rugg, Global Head of The Industry Business Unit at R3   The history of insurance traces back to the development...

Technology5 hours ago

DISPELLING BIOMETRIC MYTHS AND MISCONCEPTIONS

By Lina Andolf-Orup, Head of Marketing at Fingerprints Gangsters cutting off enemies’ fingers to access secret locations and spies lifting...

Videos11 hours ago

FUTURE FX PROMO

Videos12 hours ago

FutureFX Profile

BANKING BANKING
Banking3 days ago

FOUR WAYS OPEN BANKING AND AI WILL REVOLUTIONISE ACCOUNTANCY

Ed Molyneux, CEO and co-founder of cloud accounting software company, FreeAgent   It’s been just over two years since the...

FINANCIAL SERVICES FINANCIAL SERVICES
Finance4 days ago

HOW FINANCIAL SERVICES CAN GET TO GRIPS WITH RISING SUPPLY CHAIN RISK

By Alex Saric, smart procurement expert, Ivalua   UK businesses have never been more dependent on their suppliers to help...

MARKET DATA MARKET DATA
Wealth Management5 days ago

TWO TO TANGO? MARKET DATA AND OPINIONS IN INVESTMENT MANAGEMENT

Sebastien Lleo is Associate Professor of Finance at NEOMA Business School (France)   Analyst views and expert opinions matter. They...

EARLY RETIREMENT EARLY RETIREMENT
Wealth Management5 days ago

AN ULTIMATE GUIDE TO TURNING YOUR EARLY RETIREMENT DREAM INTO A REALITY

Rick Pendykoski is the owner of Self Directed Retirement Plans LLC, a retirement planning firm based in Goodyear, AZ.  ...

FINANCIAL SERVICES FINANCIAL SERVICES
Technology5 days ago

WHAT EVOLUTIONARY AI MEANS FOR FINANCIAL SERVICES

by Babak Hodjat, VP of Evolutionary AI at Cognizant   Many banks and other financial services institutions (FIs) are beginning...

ANALYTICS ANALYTICS
Business5 days ago

HARNESSING ANALYTICS IN THE FIGHT AGAINST FRAUD

By Anna Lykourina, EMEA Fraud Analytics Expert at SAS   In the past, the fight against fraud has been a...

ONESPAN ONESPAN
News5 days ago

ERSTE BANK HUNGARY IMPROVES AND SECURES THE REMOTE BANKING EXPERIENCE WITH ONESPAN MOBILE SECURITY

Leading Hungarian bank deploys OneSpan’s Mobile Security Suite to one million customers to make mobile banking convenient while fighting fraud...

FINANCIAL FINANCIAL
News5 days ago

HOW WILL LENDERS TREAT THE FINANCIAL SYMPTOMS OF COVID19?

COULD the coronavirus pandemic spark a financial crisis similar to that which was seen in 2008? Tim Kirby, Group Commercial...

PAYMENTS PAYMENTS
Finance6 days ago

ISO 20022 – THE BEDROCK FOR PAYMENTS TRANSFORMATION

Lauren Jones, Global Payments Ambassador, Icon Solutions   The financial services industry has seen ISO 20022 grow firmly over the...

STRUCTURED DATA STRUCTURED DATA
Business6 days ago

2020 VISION: TRANSFORMING THE LEGAL DOCUMENTATION LANDSCAPE THROUGH STRUCTURED DATA

Jason Pugh, Managing Director, D2 Legal Technology   The derivatives industry has been transformed by the proactive engagement of its...

LANDLORDS LANDLORDS
Wealth Management6 days ago

WHY LANDLORDS SHOULD MAKE THE MOVE TO THE ALTERNATIVE PROPERTY INVESTMENT SECTOR IN 2020

Reece Mennie, CEO of leading UK investment introducing firm, Hunter Jones    The new decade is expected to bring with...

Loss Loss
News6 days ago

PROTECTING YOURSELF AGAINST LOSS OF FUTURE INCOME IN A RECESSION

By Gerard Visser, Financial Planning Consultant at Alexander Forbes Financial Planning Consultants.   With low GDP growth, credit ratings downgrades and the COVID-19 pandemic,...

MOBEY FORUM MOBEY FORUM
News6 days ago

MOBEY FORUM TO ADDRESS DATA PRIVACY AND INNOVATION IN THE AGE OF AI WITH NEW EXPERT GROUP

Mobey Forum, the global industry association empowering banks and financial institutions (FIs) to shape the future of digital financial services, today announces...

SMALL BUSINESS SMALL BUSINESS
Business1 week ago

HOW TO MANAGE YOUR SMALL BUSINESS’S FINANCES

There are a lot of fantastic business ideas that end up failing during the early years. Why? A lack of...

CFO CFO
Top Stories1 week ago

THE EVOLUTION OF THE TECH CFO

Gavin Fallon,General Manager, UK, Nordics & South Africa Board International   Chief Financial Officers (CFOs) have traditionally been seen as...

FRAUD FRAUD
Business1 week ago

IS FRAUD PREVENTION CONVERGING WITH REGULATORY COMPLIANCE?

By Manuel Rodriguez, Fraud Solutions Manager at SAS   Several relevant reports show how the world of fraud and financial crimes is mutable...

Trending