Australian retailers have emerged from what is anticipated to be a record-breaking Christmas season, with online spending galvanised by the pandemic. As the dust settles, there’s a natural moment to reflect on wins and losses, and to figure out what the next priority is.

In one sense, though, the holiday shopping season isn’t completely over and done with. While retailers try to plan their next peak season, there is another potentially record-breaking surge occurring – of returns. It’s not surprising that a massive jump in online shopping is followed by a significant increase in returns, but looking at the way many retailers deal with returns, you could be forgiven for thinking that they barely matter to customers. Unfortunately, consumer surveys show that returns are actually deeply significant to customers before, during and after a purchase.

A survey commissioned by Doddle found that almost three-quarters of Australian consumers check a retailer’s returns policy before even committing to a purchase. 41 percent of Australians have stopped shopping with a retailer completely, after a poor online returns experience. With that in mind, retailers preparing for the year ahead would be well advised to flip their thinking and make seamless online and in-store returns the leading aspect of their process planning. Smart returns – those recorded, processed and completed digitally – offer customers a convenient returns experience and avoid the friction and hassle that is so detrimental to brand loyalty. They also capture much more data around returns, which gives internal teams rapid insight into customer behaviour, preferences and crucially, profitability. On top of that, returns data can be a great tool to pinpoint product or merchandising issues.

By first digitising the returns process, retailers open up the possibility for more ambitious personalisation and intelligent management of returns. Perhaps high-value customers have their refunds expedited, without waiting to receive the return at a processing centre, or customers who return too many items for their overall expenditure are asked to pay a higher rate to return their purchases.

Not only can retailers benefit from a more accurate representation of their customer base, but smart returns can also dramatically improve the customer experience, and thereby brand perception. Offering a range of returns methods, such as the ability to return online purchases in-store or at convenient local drop-off locations like post offices, supermarkets or petrol stations, makes one of the most important yet frustrating aspects of e-commerce much easier for customers.

What’s more, offering shoppers the option to return their online purchases in-store can help to recover some of the lost revenue inherent in a return, with 15 percent of Australian consumers having made an additional purchase while returning an e-commerce order in-store. Quantifying the value of those purchases, 55 percent of those consumers who had made a purchase said they had spent over $50 in-store on those visits. In uncertain times, those are difficult figures to ignore.

Consumers have always been motivated by convenience. That’s why ecommerce is still booming well after stores have reopened. We’re now seeing services such as Australia Post Collect & Return which mix the convenience of online browsing and ordering with the offline convenience of local, whenever-you-want collection and return options. That array of drop-off points includes post offices, street posting boxes and third party locations like supermarkets, department stores and pharmacies; ensuring that customers can process and post their return in the method most convenient to them.

E-commerce is rapidly growing, and securing brand loyalty with the newly converted online shoppers is crucial for retailers in the next year. To make that happen, retailers should ensure their digital processes are seamless, so that they can meet the growing demand and keep customers satisfied. With more frequent online shopping resulting in more returns, it’s time to flip the paradigm and have returns take priority. Retailers that are able to look past the immediate cost of the individual item being returned and instead have a clear picture of lifetime customer value will be those set up for success in the year ahead.

Justin Dery is CEO for Asia Pacific at Doddle.