Updated: Jul 8, 2021
Depending on the sector and platform of retail, consumers return anywhere between 6% and 15% of products! What’s worse, the volume of returns has been increasing drastically in the last few years. This phenomenon is not only financially damaging but also affects other aspects of business directly and indirectly. Therefore, one of the biggest challenges before marketing professionals today is to reduce product returns. A study about the characteristics of product keepers and product returners highlights distinct attributes of both these groups that marketing professionals can use to reduce product returns by consumers. (Link to study).
Consumers return products for various reasons like product malfunction, damage, incorrect delivery, poor quality, incomplete order, etc. The most common reason, though, is not being satisfied with the product. Companies have been improving their customer satisfaction policies and practices to address this. However, consumers often return products even when they are not dissatisfied. This behaviour, which is more damaging than return due to actual dissatisfaction, is caused by a phenomenon called Post Purchase Dissonance (PPD).
PPD refers to the stress, anxiety, or doubt that consumers face after a purchase because of a conflict between multiple attitudes or feelings about the product. For example, after buying a dishwasher for ₹ 40,000, a consumer might feel doubt and anxiety because of a conflict between wanting the convenience of the appliance and a sense of guilt over the high expense. Many consumers tend to try to resolve this conflict by returning the product. Since PPD is behind many product returns, understanding which consumers might return products to deal with it can help marketers address the issue.
The study was done by collecting survey data in New York, and hence all the findings may not be generalisable across other geographies. The study includes these characteristics and predispositions to explain PPD-based product returns:
Gender: Women tend to return products more than men by a significant margin.
Household income: Consumers in mid-income tiers return the most, followed by consumers in lower-income tiers, while consumers in the highest income tiers return the least.
Education level: College graduates are the group with the highest return numbers, followed by post-graduates. High-school pass-outs and lower tend to return products the least.
Confidence: Product returners are usually more confident of their purchases than product keepers.
Expectations: Product returners tend to have lower expectations about the products they are purchasing than product keepers.
Use of PPD coping strategies: Product keepers tend to use coping strategies like focusing on positive experiences, adjusting beliefs, seeking favourable information, etc., whereas product returners do not use any coping strategy.
The unique characteristics of these two consumer groups can help managers develop creative marketing strategies aimed at reducing product returns. For instance, ambience, display, trials, and demonstrations can be used to engage consumers emotionally and raise their expectations, reducing their chances of returning products. Strengthening after-sales and consumer communication can also help, especially if it reinforces the purchase decision positively and addresses consumer anxieties and concerns. Along with high product quality, such marketing strategies can help reduce PPD-based returns, improving revenues and profits.