According to a new study by NFO Interactive, consumers who buy products online often keep items they might otherwise return because they do not want to pay fees to return the shipments.
About one-fifth of online shoppers said they have kept products purchased online in order to avoid the fees, the Greenwich, Connecticut-based firm said.
Shipping Fees Affect Buying Decisions
More than one-third of online purchasers said that shipping fees affected their buying decisions. These fees are often “a huge consideration” when consumers are buying online, said Ann Green, vice president of e-commerce and retail at NFO.
Often, two sites will offer the same product at the same price, and “the decision factor will really be the shipping fee itself,” Green told the E-Commerce Times.
Two out of 10 people surveyed had returned an item purchased online in the past six months. Among those making returns, 89 percent mailed the unwanted item back, with 45 percent paying for return shipment. Seven percent were able to return the item at a store.
Shipping Incentives Build Loyalty
Offering incentives such as free shipping for new customers who order above a certain dollar level, or providing labels for free returns, are good ways for e-tailers to build loyalty, Green said. “I think that says a lot about the respect they have for the customer,” she added.
Once a company decides on a shipping-fee policy, however, “they’d better stick to it,” said Green. “It’s an important part of their business model and their bottom line.”
Customers Unhappy with E-tail Experience
The survey is the latest in a string of reports that show consumers are not always happy with their online shopping experiences as the crucial holiday selling season approaches.
A poll issued earlier this month by cPulse, a unit of research firm Gartner, found that nearly one-fourth of Web shoppers were extremely dissatisfied with their buying experiences. Shipping costs — in particular, hidden costs that pop up only in the final stages of the checkout process — were among customers’ biggest complaints, along with concerns about security and timely delivery.
A separate Gartner survey released in early August found that of the top 50 consumer e-tail sites, not one could be rated “good” or “excellent” in terms of online customer service. Companies that operate exclusively online tend to provide better service than their click-and-mortar competitors, the survey found.
Avoiding Another Holiday Disaster
E-tailers are still struggling to regain customer confidence after last year’s holiday season, when many could not keep up with demand. Consumer complaints soared as promised deliveries failed to arrive in time for the holidays.
Seven companies, including Macys.com, Toysrus.com and Kbkids.com, recently agreed to pay fines totaling $1.5 million (US$) as part of a settlement with the U.S. Federal Trade Commission (FTC) stemming from the large number of holiday complaints. The companies also agreed to change their shipping procedures to ensure deliveries will be made by the dates promised.
Picture Technology Could Reduce Returns
One way for e-tailers to avoid returns, according to Green, is to make sure Web site descriptions accurately reflect the product being advertised. “The closer they can get to what it really is, how it looks and feels, the lower these returns are going to be,” she said.
Still, meeting that goal may be easier said than done. While new technologies can provide clearer pictures, some might be “too sophisticated for the average user,” with long download times turning off potential buyers, Green said.