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Customers shopping from multichannel retailers will naturally expect that they can return their purchases to their local store. After all, it's all the same company, isn't it? 

It turns out that some companies are multichannel in name only. These are multichannel brands that sell and - theoretically - service customers and prospects across multiple channels, but all too often they are not joined up. The left hand doesn't have a clue what the right one is doing, and seemingly doesn't want to.

For example, some multichannel retailers don't cater for returns in a sensible way, and they run the risk of losing customers and repeat business as a result...

Returns polices: a case study

Here's a front-of-mind example. My father recently bought a new mobile phone online from Orange. It arrived by post and appeared to be a faulty handset (incoming calls wouldn't activate the ringtone, which renders the phone 50% useless). Thankfully he bought it from Orange, a multichannel company with high street stores, so that's where he headed for advice.

He took it to the store the day after it was delivered. The staff in the store were unable to fix the issue and concluded that the handset was indeed faulty. But they told him that he couldn't return it to the store.

Instead, the company offers a returns process that is perplexing, costly (for the company), slow and frustrating. Let's have a look at it in more detail. 

The Orange returns policy

The returns policy can be discovered via a link on the product page, albeit a link placed right at the bottom of the page, and which is just about visible to the naked eye...

The link leads you to the returns policy, which provides four options for returning goods: 

  1. A phone number which is only operational 9 to 5 week days. Therefore, useless on weekends, when the problem was discovered.
  2. An email address which didn't respond promptly. Despite promising a reply within 24 hours, an email sent Saturday found no reply until Monday.
  3. A fax number. Who has a fax these days?
  4. A postal address. I can't imagine that many customers, having purchased something online, use the option of writing a letter.

At this stage, six days after delivery, a returns envelope still hasn't been received, meaning that my father still has to wait until next week until the problem is resolved, even if the returns envelope arrives tomorrow. It's a bit ridiculous, when he was standing inside an Orange store one day after receiving the handset, and does nothing to convince him that online shopping is a particularly good idea.

The result of this lengthy returns process is one customer who will think twice before buying Orange again, and another that will tell other people about the negative experience.

What will customers think?

While there are challenges for multichannel retailers is integrating online and offline, customers don't really care about this. They see one company, and cannot understand why they can't return items to the store if that is what they find most convenient.

If customers order a product online and take it into their local store, only to be told that they have to send an email or call a helpline to replace or return it, they will not be impressed.

A lengthy returns procedure, such as the Orange process described above, is something that is likely to deter customers from using a retailer again.

The stats say so too: according to a recent multichannel report from GSI Commerce, 76% of consumers cited an expensive or lengthy online returns or refund procedure as a reason for not making a repeat purchase

I used Orange as example, but I'm sure it isn't the only retailer which doesn't allow multichannel returns. 

What should multichannel retailers do?

First of all, they should allow in-store returns for goods bought online. A simple multichannel returns policy means customers are happier buying online, safe in the knowledge that they can return or exchange goods locally if necessary.

This is what a multichannel returns policy should look like:

The example above is from Halfords, and the company encourages customers to return items to their local store. In fact, the only criticism I have of this returns policy is that it isn't made clear enough on product pages where it could reassure customers who are close to making a purchase. Otherwise, it is brilliant.

Multichannel retailers like Halfords are able to drive incremental sales in-store from customers that use reserve and collect service and need accessories, or else see something that appeals to them.

In the same way, multichannel returns can potentially be seen as an opportunity to drive customers into stores: if a customer returns good bought online to a store and has a positive experience, then they may leave having bought something else.

To go back to the Orange example, customers who are allowed to return unsatisfactory phones in-store may leave with more a expensive handset. As such, a lengthy returns procedure is not only a barrier to customer retention, but a missed opportunity for up-selling.

At the very least, customers will know that they can shop again with that retailer, either online or offline, with the assurance that returns needn't be too painful.

So don't risk losing future customers with painful returns policies. If you are a multichannel retailer, let customers decide which channel they want to use to return goods. This is an advantage that multichannel retailers have over pure-plays like Amazon, so why not make the most of it?

Graham Charlton

Published 15 February, 2010 by Graham Charlton

Graham Charlton is the former Editor-in-Chief at Econsultancy. Follow him on Twitter or connect via Linkedin or Google+

2565 more posts from this author

Comments (5)

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Averil Provan

Great article.  I think that retailers really need to wake up to the fact that a sale is not complete the minute it has left their store/warehouse/depot.  The customer experience lasts far beyond that point and by forgetting that, retailers lose any sense of loyalty in their customer - and may lose them as customers altogether.

Customer service needs to be seen as part of the shopper marketing agenda, building trust and loyalty.

It would be interesting to find out if Orange follow up this situation to get feedback on your experience.

over 6 years ago

Russell Gould

Russell Gould, Managing Director at Everline

Yes very good article.  Getting the approach to multi-channel retailing is obviously critical espcially when considering the value of electronic communication and the fact that most consumers channel switch throughout their research, purchase and post purchase experience.  

Just to highlight how devastating this can be to customer experience - last week I visited my local store of The Body Shop (yes I hate to admit it publicly but their Hemp lip balm is the business!).  

Anyway the two people in front of me created a bit of a scene, left their goods on the counter and left the store muttering something to the effect of "That is just stupid we will give our custom to Boots instead".

When I reached the counter the manager looked at me nervously and stated that they could not offer me half price (50% off) on my lip balm and I needed to buy it online!

It turns out that their internet business, run by a separate MD to their Retail business, had issued an email offer to all subscribers (many of which subscribed in store) offering 50% of all Hemp branded products.  The couple in front of me were the 5th set of customers that had dumbed their goods and left the store - and it was only 11:00am.

Not exactly the customer service that drove the growth under Anita Roddick!  

Anyway now that I am consulting, www.e-strategyconsultancy.com, I offer my services to The Body Shop - I wonder if they will change their approach. 

over 6 years ago

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Rick Boretsky

Great post. Could not agree more! I have blogged about this in the past too, and how this is an opportunity for Brick & Mortar retailers vs pure play e-commerce sites. NOT having an acceptable multi-channel return policy will actually even frustrate the customer more than the return policy of a pure e-commerce company. Multi-channel retailers MUST get this right.

over 6 years ago

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Mark Sauer

Agree with everyone.  This is great article, especially for this time of year when retailers are likely examining the recent holiday time period to see what improvements could be made in 2010.  Also, enjoyed the posts.

A good multi-channel return program is challenging, especially if a company's on-line and brick-n-mortar stores are not synced up.  It is important to not only provide strong customer service, but also ensure that a company can receive some value on the returned item.   Although a challenge, the benefits are worth it.

over 6 years ago

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Jane Myers

Great article - and a recent experience with Easyjet - a company who prides themselves on enabling customers to buy on-line - shows yet another retailer needing to look at making things easy on the customer. When something happens with a booking they are extremely difficult to contact - either via email or via the telephone. I bought return flights to Amsterdam for January '11 and due to Easyjet changing the flight times since booking I am entitled apparently to a refund or a credit - but this cannot be arranged on-line so having had no response from several emails and having been cut off from their 0871 and 0870 'customer experience' lines I am having to take the matter further - very frustrating and time consuming!

Jane

almost 6 years ago

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