Key Takeaways
- We gathered three seasoned industry experts from Swanky, Starshipit, and Descartes to discuss trends and innovations in the returns management space in 2025.
- Returns management in 2025 will depend on how well retailers use data and automation to reduce friction, control costs, and protect margins during high-volume periods like post-Peak.
- Brands that treat returns as part of the end-to-end fulfilment strategy, not a separate afterthought, will be better positioned to resell stock faster, retain customers, and scale sustainably.
Drowning in a sea of returns post Peak? Unsure how to set a strategy that balances customer service with profitability for your brand? No problem. These three experts have plenty of insights to share.
Contributors to this blog post include:
- Sean Clanchy, Managing Director of Swanky’s Australia and New Zealand (ANZ) office, a full-service Shopify Plus agency dedicated to helping brands scale.
- Hakan ‘Hawk’ Steele, Partner Manager at Starshipit, ANZ’s leading integrated shipping and returns platform.
- AJ Lockington, Marketing Director for Ecommerce Solutions at Descartes.
We discussed the challenges and opportunities of managing ecommerce returns, particularly during the holiday season, the mismatch between consumer demands and operational realities, and finally the trends we are likely see in the space moving into 2025.
Table of Contents
Why Are Returns Such a Relevant Issue?
Ecommerce returns, with rates as high as 40%, are a costly challenge for online brands, compared to the 8-10% return rate for in-store purchases. The holiday season magnifies this, with up to 60% of returns occurring after peak shopping periods. Factors driving up the financial burden include:
- Rising transportation and labour costs.
- High customer expectations set by industry leaders like Amazon.
- Liberal return policies and free returns.
- ‘Bracketing,’ purchasing multiple sizes with plans to return some.
- Increasing fraudulent returns.
Aligning Customer Expectations with Operational Realities
Modern customers demand the world when it comes to returns: free returns, extended windows, omnichannel options, instant refunds, and real-time updates. However, retailers face serious hurdles trying to meet these expectations such as legacy IT systems, manual workflows, high reverse logistics costs, and a lack of real-time inventory visibility.
What Can Retailers Actually Do?
The panel highlighted strategies for reducing costs while maintaining customer satisfaction:
- Adopt technology: Returns platforms (e.g., Starshipit, Loop) and warehouse systems (e.g., Peoplevox) automate workflows and provide actionable data.
- Optimise warehouse operations: Implement paperless processes and train staff to accelerate returns and restocking.
- Innovative solutions: ‘Try before you buy’ models from the likes of Try With Mirra and international returns hubs cut shipping costs and improve convenience.
- Transparent communication: Keep customers informed with clear updates and flexible refund options.
- Analyse returns data: Identify root causes (e.g., unclear product descriptions or sizing issues) and implement improvements.
The Trends We Are Likely to See Next
The trio move on to identify emerging trends that ecommerce brands could leverage:
- Instant refunds to boost loyalty and repeat purchases.
- ‘Try before you buy’: Reduce purchase friction and returns.
- Streamlined international returns: Use third-party logistics (3PLs) services to cut costs and improve efficiency.
- Circular economy: Invest in repairing, refurbishing, and recycling returns to reduce waste.
- Order editing: Allow customers to correct errors pre-shipment, reducing unnecessary returns.
- Empowering customers: Self-service options like order edits enhance the experience.
- Paperless returns: Boost efficiency and accuracy.
- Personalisation: Customised products reduce return rates and enhance brand loyalty.
Our Big 5 Takeaways
- Returns are both a challenge and an opportunity. Use them to build loyalty through stellar service and communication.
- Technology is key to optimising returns. Automation improves efficiency and data-driven insights.
- Warehouse efficiency is crucial. Quick returns processing supports resale and inventory management.
- Innovate to reduce costs and enhance customer satisfaction. Solutions like ‘try before you buy’ and returns hubs are game-changers.
- Future returns processes must prioritise the customer. Flexible options, clear communication, and empowering self-service will drive success.
“Over $1bn was spent on returns shipping in 2024 alone. That goes to show the size and scale of this right now. And it’s only getting bigger!”
– Hakan Steele, Partner Manager, Starshipit.
How To Fix Your Holiday Hangover – Watch the Conversation in Full
Find out more about Peoplevox’s Starshipit integration here.
Book a call today to learn more about Peoplevox and how its return management features can help your business.
FAQs
How Can Better Returns Management Improve Warehouse Efficiency?
Well-structured returns processes reduce manual handling, speed up inspection and restocking, and prevent returned items from sitting idle. When returns are processed quickly and accurately, warehouses can recover sellable stock faster and maintain healthier inventory levels.
What Role Does Automation Play in Managing High Return Volumes?
Automation helps warehouses handle spikes in returns without overwhelming staff. By removing paper-based steps and guiding workflows digitally, teams can process returns consistently, reduce errors, and keep operations moving during peak and post-peak periods.
How Should Returns Data Be Used to Reduce Future Return Rates?
Returns data can highlight recurring issues such as sizing problems, product quality concerns, or misleading descriptions. By feeding these insights back into merchandising, product content, and operations, brands can address root causes and reduce unnecessary returns over time.
