Returns misery? How IT can underpin a seamless January returns process

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Recent research has revealed that one in four Christmas gifts will be returned early this year, worth around £4.8 billion of the estimated £19 billion in online sales over the festive period, according to the Centre for Economics and Business Research.  

Barclaycard research suggests a quarter of retailers (26 per cent) have seen a rise in returns in-store and online since 2016, with the number of returned items up by 22 per cent on average.  

Returns put a significant amount of pressure on retailers, resulting in reduced revenue alongside the challenge of stock management. Siloed IT systems between applications, branches and warehouses can result in a disjointed approach to inventory reporting, negatively impacting the customer experience and potentially harming sales and customer loyalty.   

2018 was a challenging year for retailers, with sales at brick-and-mortar retail stores falling 1.9 per cent in December on a like-for-like basis – the worst year-on-year monthly sales fall in over a decade.  

With economic growth flat-lining - alongside Brexit on the horizon - markets are as uncertain as they’ve ever been. Consumers are being cautious with their spending, seeking the best deals where they can find them, driving up competition.   

With that in mind, the customer experience is as critical as a retailer’s pricing strategy. Connected data, up-to date stocklists and a quick and seamless purchasing process must all be staples in any retailer’s diet.  

The returns challenge

There is no shortage of tech applications and systems in the market today to support retailers. Any store - digital or physical - could be managing a multitude of IT systems from physical in-store point-of-sale (POS) systems, e-commerce platforms and warehousing applications to billing, customer relationship management (CRM) and enterprise resource management (ERP) solutions. Yet for a business to fully harness the potential of these systems and applications - and deliver a first-class customer experience - they must be able to talk to each other, share data and help the business glean better intelligence into its customer-base.  

Cloud-based integration platforms provide a simple, user-friendly way to integrate applications and data without the cost and complexity of clunky solutions that require custom coding. Retailers will benefit from a platform that can connect any combination of best-of-breed cloud applications with legacy on-premise systems (and with each other) - transforming themselves into more transparent, experience-driven organisations focused on delivering a superior customer journey.

Online growing pains

The growth in online shopping - alongside this deluge of on and offline returns - has put extra strain on retailers, with limited time in order to process orders, track refunds and update stocklists to ensure accurate and up-to-date listings. January always sees a peak in shoppers, whether they’re buying or returning gifts - and retailers must ensure their online sites are ready for this surge in visitors, with their teams and IT systems also able to scale quickly to support changes in demand. 

We’ve already seen examples of online retailers being struck down during crucial times for their customers. Recently, during its famed Amazon Prime Day, Amazon was hit by stark technical glitches that could have cost the company around $90m. Argos also saw its website go down shortly before the launch of its Black Friday sale in 2016, with the UK retailer citing “high demand” as a factor contributing to the outage.

Delivering in an omni-channel era 

Such outages and IT failures can have a clear impact on customer loyalty, as well as the immediate loss in sales, with a whole host of rivals ready to step in at any given moment. Whether it’s the website going down, unavailable stock or a poor user experience, all of these aspects can affect customer allegiance. After all, why would you go back to a store when you’ve received a below par service?  

With online and mobile shopping expected to rise again this year, ensuring a seamless customer experience that’s channel-agnostic is even more key for retailers seeking to transform a good experience into a great one.  

Linking multi-channel orders and customer records together - to bring a single view to marketing and support services - enables retailers to deliver more personalised experiences for their customers. They can also deliver accurate, real-time inventory data across ecommerce and physical stores to influence online purchasing and help ‘save sales’. With automated updates, shoppers aren’t left disappointed by incorrect stock displays causing delays, late deliveries or even missing out on products they want.  

In fact, the provision of live visibility into inventories enables retailers to significantly enhance demand planning and streamline stock replenishment processes – keeping more accurate tabs on what’s selling and what needs a promotional boost.

While a large amount of festive gifts will be returned this year, ensuring people, processes and data are integrated is key for retailers seeking to deliver a seamless, connected customer experience. Those most connected of retailers will be best placed to ride out the storm.

Derek Thompson, VP of EMEA, Dell Boomi