What would you do to return a purchase without finding an appropriately-sized box, printing a label and going to the post office? To many shoppers, this is such a dreaded part of the process that they'd far prefer to hop by the store themselves.
An annual study by PayPal (PYPL) company Happy Returns found that 54% of consumers prefer to drop off an unwanted purchase at a store or other third-party location while 79% avoid mail-in returns as much as possible--sometimes, even to the point of keeping the item.
At 83%, shoppers who are under 30 are even more likely to avoid mail-in returns.
But while mail-in returns are inevitable for items that were shipped from a small shop across the country or internationally, a number of larger retailers are installing drop-off locations in different cities.
In-Person Returns Are Increasingly Preferred
Happy Returns partners with retailers to install such drop-off points within the store. Companies that use it include beauty company Ulta (ULTA), office supply giant Staples and FedEx (FEDEX) --customers who purchased an item online receive a QR code and can drop it off at a pick-up point inside the store
Department stores like Nordstrom (JWN) and Saks Fifth Avenue as well as big-box chains like Walmart (WMT) have their own curbside return drop-off programs that exploded in popularity during the pandemic--many people liked that one could drop off an item on the street without going into the store.
Strong return policies are particularly relevant as, this holiday season, larger and larger numbers of people plan to be more conscientious about their shopping.
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According to Deloitte's 37th annual holiday retail survey, the average shopper plans to buy nine holiday gifts this season--a drop from the 16 that they planned to buy in 2021.
The reason? With inflation for many popular toys and electronics at all-time highs, many are staying within their shopping budget by cutting a few people they would normally spoil for Christmas from their list.
An Economical Holiday Season This Year
This also trickling into second-guessing expensive purchases and returning more items.
"Merchants are facing greater challenges with online returns heading into this holiday shopping season, including increased logistics costs due to inflation, higher return rates as more shopping moves online, and customer expectations for online returns that are easy and free," David Sobie, VP of Happy Returns, said in a statement.
Nearly one in every four of the 2,002 shoppers surveyed by Happy Returns said that they'd be returning a larger number of their online purchases this year. The numbers get even bigger for shoppers under 45.
Retailers that make returns easy can win over shoppers who are on the fence or second-guessing about buying a given item--86% said they check a store's return policy before making the purchase, while 87% find free returns are an important consideration on whether or not to buy a given item.
And while a decade ago many big retailers advertised the "convenience" of avoiding the store by mailing in your purchase, the customer frustration that comes with printing labels (nearly 40% of U.S. households do not own a printer) and finding the right mailing box is pushing many toward the new strategy of installing drop-off boxes in different cities.
"The growing preference for in-person, box-free returns is a huge opportunity to deliver customers the seamless returns experience they're looking for, while significantly driving down costs by up to 40%," Sobie said.
