Flora Joseph (not her real name) has a system. “My approach to online shopping is to order a bunch of sizes, then return what I don’t want. Or if I’m curious about the material or fit, I’ll order it just to see, even though I know I’m probably going to return it,” she says, then laughs.
“My husband is horrified by the quantity of clothing that comes into the house. He doesn’t pay attention to how much goes out – really I end up keeping very little.”
Changes to shopping habits that had been making steady progress for years accelerated to warp speed in 2020. When stores closed with the onset of lockdown in March, the result was a wholesale shift to online shopping, with ecommerce sales surging 42 per cent over the past six months – and as the way people shop changed, so did the way they returned.
“The bedroom is now the fitting room,” says Al Gerrie, founder and CEO of ZigZag Global, a leading global returns platform that facilitates returns for Topshop, Boohoo and Selfridges.
Just as shoppers who carried armloads of clothes into a fitting room might buy only one item, online shoppers are treating unboxing as a median stage in the shopping process, often filming this mundane unwrapping process for thousands of social media followers. First they order, then they receive, then they try on, and <then> they decide what to hold onto. “Something isn’t actually sold anymore until it’s kept,” says Graham Best, CEO of ReBOUND Returns, a global returns network that processes 100m transactions a year for Missguided, ASOS, Gymshark and other clients.
Early figures show that returns have surged as much as 20 percent year-on-year. On 29 June, ReBOUND logged its biggest day of returns registrations ever – even bigger than the post-Christmas returns hangover in 2019.
The items people send back read like a material diary of coming to terms with life under Covid-19. In June, July and August, people sent back swimsuits and holiday-wear; after that came a shift to returns of more optimistic purchases: unworn partywear, high-heels, handbags. “It’s psychological,” one shopper says. “I’ve found myself buying things and then sending them back when I realise I’m not going to have anywhere to wear them.”
What’s not going back are the sweatpants. “We’re seeing fewer returns,” says David James, Boohoo’s director of supply chain. “Like many brands, we have extended the returns window, so there may be a delay factor here. But we think it’s because the items people are buying, such as comfy loungewear, are items where fit is less of an issue than, say, a dress, which people order in multiple sizes.”
How retailers view returns differs depending on the audience. Most will say they’re happy to offer generous return policies because they want shoppers to purchase liberally and feel comfortable taking risks on pieces that may not be in their style comfort zones. Privately, many concede that returns can be “a nightmare” – particularly when it comes to in-demand luxury goods. A £1,000 handbag that’s marked as ‘sold out’ while it’s with a noncommittal buyer and then in returns processing is a missed opportunity for a £1,000 sale to someone who may be more likely to keep the purchase.
The likelihood of that handbag – or a dress, or a pair of jeans – being returned increases if the purchase is made online. While the average return rate in the UK for in-store shopping is five to 10 percent, the average for online shopping is 50 percent.
Best, the ReBOUND CEO, says that businesses have to reframe buy-and-returners as their most loyal shoppers. “The myth is that a serial returner is a bad shopper. The reality is that serial returners are potentially your best customers. They try things on, they get to know exactly what fits, they're much more experimental. They're returning a lot to start off with, but if you look at the graph, over time they’re buying more and more.”
Still, there are costs to consider. “There’s no such thing as a free return,even if retailers aren’t charging for it, Gerrie says. “It’s a loss-maker.” Along with shipping, there are charges for storage, warehousing and packaging; new costs associated with sanitising and quarantining clothing items so they’re safe to put back into the shopping ecosystem have also arisen. If items are out for long enough – an increasing liability in these days of 100-day return windows – then chances are they’ve been marked down or become unsaleable during their time offline. You’re less likely to be able to sell July’s bikini in October.
The costs take other forms, too. “We’re shopping in such a radically different way than we were a year ago,” says Tamara Cincik, founder and CEO of Fashion Roundtable, the sustainability advocacy group. “If you’re shopping online and buy in three different sizes, planning to return two of them, then the company has to overproduce to meet the target of the consumer…. That leads to overproduction, which leads to more waste.”
With a fifth of British shoppers saying they don’t plan to return to physical stores at all, the shift to online seems here to stay. Which means the £8 billion returns tab British fashion businesses bear could be going up.