Reduce Chargebacks With the Best Return Policy

Between Chargebacks and returns, the latter is by far the lesser of the two evils.

When it comes to the best return policy, few rival Zappos, which makes it easy for its customers to return items: ready-made labels, free shipping and 24-7 customer support. All the customer needs to do is log on to their Zappos account, select the items they wish to return, print and attach the label to the original box, and drop off at the nearest post office.

Online retailers like Zappos are rare. But they are an excellent example for all e-commerce businesses: Through Zappos’ example, consumers can realize the importance of making a return rather than making a chargeback.

As far as return policies, not all e-commerce merchants can handle free shipping on returns and 24-7 customer service. But there are a few things merchants can learn from Zappos.

Handle Disputes in Person…if Possible

We understand this is a very difficult ask for most e-commerce merchants. But it is something that can bring a customer back.

I’ve got a close colleague who owns an online lobster dinner delivery business, LobsterAnywwhere.com, which ships live and frozen lobster dinners anywhere in the continental U.S. overnight.

Occasionally, a customer will receive the wrong order, so he personally calls them. And he’ll throw in a few extras – lobster tails, frozen chowder or bisque, or lemon meringue pie – with their next order for good measure. Over the last five years, he has received less than 10 chargebacks.

Include Return Items with All Shipments

This may seem like a message to the customer that your product is guaranteed to be unsatisfactory, but the message is really quite the opposite: That customer satisfaction is the merchant’s highest priority.

Along with the product, it is a good faith measure to include shipping return materials. Make it really easy for your customer by attaching the return label to the return packaging (a box, or bag), so all they have to do is drop it in a mailbox.

Incentives are Always Good

Small e-commerce merchants have to watch finances – it’s understood. But merchants unable to handle free shipping can make up for it by offering, for example, a 10 percent credit on a customer’s next order; or perhaps a $10 gift card to a national restaurant or coffee chain.

Your customer will appreciate it, and better, share it with others.

What’s your Return Policy?

We’re curious to know what your return policy is. Leave a comment below.

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