Sales are great aren’t they? For every marketeer, pretty much without exception, looking at response rates, average baskets, and sales from your campaign is like a shot in the arm. Triumph. We look at our response uplifts, congratulate ourselves on our customer selections, creative execution and content and move to using what worked, to make the next campaign even better..
But.. what if, 60% of all the dresses we sold through our campaign get returned? What if the customers I think are my best customers are actually serial returners who are costing my business a fortune? Well, let’s not think about that because the sales were great weren’t they. Reverse logistics nightmares, handling costs, out of stock issues, that is surely someone else’s problem, isn’t it?
The reality is, it’s time for a seismic paradigm shift in the way we think about the sales and our customer. With the increasing growth of online fashion sales, and as customers become more and more comfortable with the concept of their home being their changing room, retailers have to grasp a basic concept – a sale is not a sale until the customer decides to keep it.
The simple reality is, using our big data algorithms to match customers with a product they will actually keep is game changing in its simplicity. Optimizing what a customer ‘keeps’ rather than ‘sales’ is the only viable way forward. The benefits are endless for every business unit – sales growth, retained revenue, operation cost savings, improved personalisation and stock availability improvements, not to mention the fact that by marketing products to customers they will want to keep is putting them at the heart of what you do.
We are the only company globally that can lead this change. We understand who are keepers, who are high risk to your business from a return, who should be encouraged to return and explore and what product or category your customer should be marketed with to make sure what they buy they actually keep. Feeding customers who are costing your business money with endless marketing campaigns, promotions and incentives has to become a thing of the past and with new big data technology, it can be.
Adding revenue to the bottom line has actually never been easier, retailers simply need to take the blue pill and delve into the new world of customer returns behaviour.
Keeping stock sold – avoiding returns the key to retail profits
The sales figures over the peak trading periods of Christmas and Black Friday may make the headlines, but those returns coming back over the next 28 days will cost retailers millions…and often get ignored.
It’s time to get the facts.
Playing for keeps…
Clear Returns new Playing For Keeps report offers the facts around returns on Black Friday, peak season and beyond. £160 million of Black Friday stock is set to be returned, stock that will then be unavailable to sell during the most critical trading period of the year…Christmas.
Playing For Keeps is more important than ever as it is not really a sale until the customer decides to keep it. Returns kill retail profits and Clear Returns presents the facts that the wider retail business simply cannot afford to ignore:
Clear Returns CEO, Vicky Brock, explains why Black Friday could end up being a short term gain but long term loss for many retailers:-
“Forget the headline-grabbing figures of what analysts say people are going to spend on Black Friday. That’s just the beginning. The real concern is that the event could end up costing retailers money rather than boosting their profits.”
“This is because the spike in sales from November 27 will be followed, for many businesses, by an increase in returns – and profit is only generated when customers decide to keep their purchases. On average, 14 per cent of all consumer electronic sales are sent back, and in the build-up to Christmas in particular, this can cause all manner of logistical headaches and lost margins.”
Building on the success of 2014, The Customer Returns Summit is back for 2015 and is bringing together the most senior reverse logistics experts from leading retailers that include Debenhams, Shop Direct, Tesco, Panasonic, Argos, Sony and more. Clear Returns is pleased to be a sponsor at the event in 2015.
Clear Returns, CEO, Vicky Brock on why this is a significant event in the retail calendar:
“I think it’s incredibly important that there’s a retail industry event focused on what I believe is the biggest challenge for retail right now, particularly distance selling retail like e-commerce and TV shopping.
Returns globally is a £425 billion problem, £221 billion of which have been identified as preventable, which means if the retailers do something about it, if marketing is tackled, if customer processes/delivery is tackled, there is £221 billion worth of additional retained revenue on the table for retail profits.
Clear Returns are the industry leader in returns intelligence. It’s an absolute no-brainer for us to be there. Our absolute specialism and remit is that we help retailers identify, tackle and ultimately, prevent returns, and we do that by looking at the products, the customers, the marketing and the service processes that are driving up return rates, and more importantly, the interplay of those things.
Clear Returns are delighted to be attending the Customer Returns Summit once again and are looking forward to discussing many key aspects of developing customer experience and retail profitability in a multichannel retail context. We look forward to meeting others in the retail and supply chain who have reducing returns to a manageable level on their corporate agenda.”
Returns kill retail profits. Clear Returns offers a pro-active solution. So, why not get in touch?
Clear Returns are delighted to be featured on Consultancy.uk, the online platform for the consultancy industry.
This piece is dedicated to our work with IBM to improve the retail analytics landscape for numerous retailers around the globe. Since victory at the IBM SmartCamp in Dublin, Clear Returns have gone from strength to strength in helping some of the biggest names in retail save thousands on their return rates.
“The effects of returns can be relatively negative on the business from which the clothes were sourced. According to Clear Returns, in some retail branches 80% of customers that undergo a return experience, do not shop at that retailer again, while 1% of serial returners come to drive 10% of total return costs. The most interesting aspect of the research is that it is a relatively small number of products (7%) that account for a large part (50%) of total returns…”
Stephen Budd and Vicky Brock of Clear Returns talk with IBM on retail analytics, big data and how insights into returns data leads to big uplift in retail profits.
IBM is a multinational and consulting corporation from the United States of America, with headquarters in locations such as New York. IBM manufactures and markets computer hardware and software, and offers services in hosting and consultancy.
The video can be found below from our official Clear Returns Youtube channel: