Close to two-thirds (65%) of Australian shoppers show greater loyalty to retailers that provide free returns, according to research by SAP Emarsys.

The research, unveiled at NRF 2024 in New York, found that more than two in five (44%) of Australian consumers abandon a purchase due to complicated returns policy, while 43% actively avoid online retailers that charge to return items.

SAP Emarsys data found the rate of returns continue to climb over the last 12 months. However, not all returns are genuine, with 15% of consumers admitting to ‘wardrobing’ — where consumers buy items with the sole intention of returning them. A common example is shoppers buying the same product in multiple sizes when unsure of the fit.

To address this, many retailers have started charging a returns fee. However, the SAP Emarsys research suggests this is causing shoppers to switch, with almost half (47%) indicating their loyalty decreases for brands that charge for returns.

In addition, over two-thirds (69%) of respondents say they do not want to have to return items, and 56% want retailers to “get it right the first time,” indicating Australian consumers do not want to deal with returns.

SAP Emarsys regional vice president of sales for Asia Pacific & Japan, Will Wilson commented, “Returns are a pain for both retailers and customers, significantly impacting profit, customer service, loyalty and sustainability. It is understandable some retailers have started charging for returns but with personalisation as part of an omnichannel strategy, brands can get it right the first time, dramatically reducing the need for returns in the first place.

“It is all about knowing the customer. If someone has purchased 12 items in a year, a retailer might think they’re a big fan. But if they’ve returned 11 items, the story is different.”   

In the research, 13% of consumers say that retailers could reduce their rate of returns by providing more personalised marketing materials, while one-third (33%) of consumers would like to see more personalised recommendations and deals that make the online experience more like shopping in store.