Seeking some information on return labels for your eCommerce business? Read this article through to the end. It will guide you with the following.

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What Are Return Labels?

In simple words, a return label is a sticker that is affixed on a package that is delivered to your customer against the original order. On every label, you will find all the shipping-related information including the return destination address (ie: your store or warehouse), barcode, etc. So, you and your fulfillment center can track the package on its way back to a restocking.

These labels do not require your customers to pay for the return shipment of the product. This means you are offering them a free return shipment to use in case they wish to return the product.

What Does A Return Label Look Like?

return label

Look at the above image of a sample Returns Label. The major requisites of a return label are the return address and the barcode. Other than these two, you will also find

  • Name and logo of the shipping carrier
  • Weight of the package
  • Date of shipment
  • Fragile information, etc.

Let us move on to the next section where we can find out the pros and cons of providing Returns Labels to customers.

Pros Of A Return Label

#1 Enhances Customer Experience

A good customer experience boosts your customer retention rate. Providing a return label gives your customers confidence in your brand. By offering a return label to your customers, you reduce their time and energy in acquiring one.

In case the customer wants to return the product, he can simply make use of this. This hassle-free return experience will build loyalty to the brand and encourage future sales. 92% of customers answered that they will continue buying from a brand that provides an easy returns experience.

PwC released a survey report on the future of customer experience (CX) as 1 in 3 customers will leave a brand after just one frustrating experience. Adding to that, 92% of consumers will stop buying from a brand after two to three unhappy interactions.

#2 Boosts Sales

It is found that 67% of online shoppers check the return policy before placing an order. They would not hesitate to try your product if they learn that you will provide them with a return label. As you are offering what they are expecting from you. That is, 79% of buyers want online retailers to provide free return shipping.

Returns may cost the company but not your customer. Yet you can take this chance for,

  • One – you don’t have to pay the charges unless the return label is used, and
  • Two – you have acquired a potential loyal customer.

The following survey study proves this as a thumping 92% of customers will make repeated purchases from a brand if the returns are easy!

#3 Safe Return Shipment

return shipment

Since you have issued the return shipment label with all your address particulars, you can be assured of receipt of the returned product. If not, imagine your customer had by mistake written an incorrect street address or pin code, then you are in for a double loss:-

  • Product not received for restocking, and
  • Customers will demand a refund.

#4 Beat The Competition

How? Only 49% of retailers are furnishing prepaid return labels for their customers, so far. So, you still have the advantage of acquiring an unexplored audience.

Use return labels as a marketing tactic to attract more customers and reduce your return rate. Return labels for reducing returns rate! Doesn’t it sound exciting?

This is also like providing proactive customer support on returns. Are you wondering how? Simple, when you send the pre-paid return label, it shows that you have taken an anticipatory measure towards easing your customer’s returns process.

Cons Of A Return Label

We discussed the advantages of using a return label in your eCommerce business. Now, we should also look at the other side of the coin, ie: the disadvantages of providing return labels.

#1 Probability Of Increase In Return Rates

In any case, especially in the eCommerce business, you need to be prepared for the worst too. As you are providing flexible returns through return labels, there is a section of online teasers who could turn out to be a potential threat to your business.

Studies found that some 30% of online shoppers buy products intentionally and return them later.

#2 Impact On Your Profit Margins

Though you foresee a certain amount of unavoidable return rate to an extent, we suggest you also anticipate the effect on profits to your eCommerce business. Use the below-given formula,

Total Profits – Cost of Returns = Total Profit, to calculate your profits after the returns.

Every product returned directly incurs a part of the loss in the profits of your business. It is evident that you have lost the capital which you have invested in the labor and shipping of that product.

And if that return is due to damage/defect, then you have to bear the loss on manufacturing costs and raw materials too. Additionally, you need to face the brunt of reverse logistics expenses too.

Coming up next are the methods of offering a return label. We are bringing you three different methods to give return labels to your customers. These will help you choose the best suitable method for your business model.

Methods Of Offering Return Label

#1 Prepaid Return Labels

From the name itself, you can understand that you are bearing the return shipping charges in case the customer wants to return the product. You send this label along with the package to your customer. Yet again, as described above, you will bear the charges only when the customer claims the returns.

#2 One-click Downloadable Return Labels

47% of people expect free downloadable and easy-to-print return labels from online stores. This comes as a safe bet if you are offering free shipping to your customers.

In the previous case, customers receive the return label along with the product. This raises the chance of returning probability psychologically. That is, even if the customer did not like one small thing, he would decide immediately to return the product.

Whereas, if you ask him to download the returns label if required, there are chances that he may overlook the smallest flaw and decide to keep the product. This method also provides a window to choose which item to be returned if not the whole order. Plus you are helping nature by saving on paper usage.

On the flip side, your customer may also feel satisfied with the easy returns label generation process and stand loyal to your brand.

#3 Return In-store

62% of shoppers show interest to buy a product if they have the flexibility to return it at any store outlet in person.

Looks like customers are ready to make a trip to a nearby store to return the product in person. This method may prove useful to you provided you own brick-and-mortar outlets too. You are inviting more footfall to your store. When a customer walks in to return a product, he may be interested in some other products and end up buying from you.

Not just that but providing multiple options to your customers will create a positive impression about your brand. And they won’t stop there. They will do the talking for you by spreading their happy experience with your brand to 6 or more people.

Through The End

By now, you would have understood what is a return label, its pros and cons, and methods to use. Apply the best practice for your business and be benefitted.

We would also like to add a little more useful information to help you quickly decide on an effective Returns process. Check out Helplama Helpdesk. This helpdesk understands your business totally and helps you with a self-help portal, automated returns/exchanges, 24/7 order monitoring, one-click download return labels, and more.

Start your 15-day free trial now