Are Retailers To Blame for Return Abuse?

A new survey finds consumers believe retailers are at least partly responsible for fraudulent returns, with 68% believing retailers make it easy to abuse flexible return policies.

The survey of over 4,000 U.S. and U.K. consumers from Forter, which helps online sellers reduce fraud, found nearly half (49%) admit to abusing retailers’ policies in the last 12 months. Of the offenders, 29% did so to avoid paying full price.

Approximately 30% of all respondents admitted to wardrobing — using an item and then returning it as if it were unused — but that figure jumps to nearly half among those aged 18 to 34. Of the respondents, 21% also acknowledged that they had deliberately over-purchased to qualify for free shipping, with the intent to return the extra items.

At the same time, the survey found that nearly half (48%) of U.S. and U.K. consumers are buying more from retailers with lenient return policies due to financial concerns, with 16% having stopped shopping with a retailer altogether because they made their return policy stricter.

Forter warned that a “one-size-fits-all approach” to combat return fraud may turn away good customers. Ozge Ozcan, chief customer officer of Forter, said, “By knowing who they’re doing business with, retailers can strike the crucial balance between customer-friendly policies and protection against serial abuse.”

Lauren Beitelspacher, a marketing professor at Babson College in Wellesley, Massachusetts, whose work covers return policy research, told USA Today that she believes online shoppers have exploited overly generous return policies introduced during the pandemic, when returning items in person was difficult. She said, “So in order for retailers to minimize the consumers’ risk, they offer free returns and free shipping, and people just went nuts and took advantage of it.”

Reports last year confirmed that REI and Target were among retailers banning some “serial returners,” including shoppers wardrobing or bracketing, which is when shoppers order multiple sizes or colors with the intent of returning those they don’t want.

Beyond bans, retailers have been taking other steps to reduce the rising costs of returns, including charging for mailed returns, reserving free shipping on returns for loyalty members, and shortening return windows.

A global survey conducted last year by returns management platform Loop polled around 600 retail professionals overseeing their company’s returns process and found that the most common responses to returns fraud or policy abuse were:

• Tightening return policies, 47%
• Permanently banning repeat offenders, 41%
• Implementing return fees, 37%
• Highlighting the negative environmental impact of returns, 35%
• Modifying the online return process to require more detailed customer input, 34%

The survey also found that a majority of respondents (52%) indicated that “maintaining a good customer experience” was the top challenge their company faces when addressing returns abuse.