New research conducted by banking platform Tink has revealed that poor returns policies are having a significant impact on consumer spending habits. According to the study, 30% of UK consumers are choosing to spend less online due to concerns about the lengthy refund process and the impact it may have on their bank balance. Additionally, the research found that 52% of consumers are less likely to shop with a retailer if they experience delays in receiving a refund. This means that retailers are potentially losing out on a large number of customers who may have had the intention to make purchases but are discouraged by the lengthy refund process.
The report emphasizes that retailers are missing out on valuable revenue and repeat business due to the current refunds processes. This is particularly concerning as retailers are already facing challenges such as rising costs and decreasing sales in the current economic climate. In fact, the study shows that 40% of online retailers are focusing on cost-cutting measures, with 54% anticipating that they will have to discontinue offering free returns due to the economic conditions.
Processing returns is often a pain point for merchants, with 43% of them citing the cost of processing returns as a challenge, and 40% highlighting the long wait time for customers to receive their refunds. However, the research also reveals that a significant number of retailers recognize the importance of improving the returns process. About 36% of them believe that instant refunds would enhance the customer experience, while 32% believe it would reduce costs for their business.
Tom Pope, Head of Payments and Platforms at Tink, commented on the findings, expressing concern over the challenges faced by UK online retailers in terms of rising costs and meeting consumer expectations regarding returns and refunds. He emphasizes that retailers risk losing out on crucial revenue and repeat business in an increasingly challenging operating environment.
Overall, this research highlights the negative impact that lengthy refund processes can have on consumer spending. In order to ensure customer satisfaction and retain valuable revenue, retailers need to address this issue by improving the efficiency of their returns and refund processes. It is crucial for retailers to adapt and meet consumer expectations, particularly in the current economic climate.
Useful links:
– How to Create a Return and Refund Policy for Your Business
– How to Handle Returns and Refunds in Retail
