Leverage Black Friday returns data to improve your customer experience, protect net revenue, and prep for an even more successful Black Friday next year.
Despite inflation, changing consumer habits, and extended holiday sales events from retailers, Black Friday broke records last year with $9.12 billion dollars in sales. While in-store shopping reported less traffic than expected, Reuters specified that “Americans turned to smartphones to make their holiday purchases, with data from Adobe showing mobile shopping represented 48% of all Black Friday digital sales.”
While the Black Friday landscape is clearly evolving, that doesn’t mean there isn’t still ample opportunity for sales. Oftentimes though, return rates are likely to increase along with high sales numbers.
IMRG says, “In recent years, +143% more items have been returned on 3rd December than any other date in the year, as shoppers return impulse items that they bought during the Black Friday weekend.” According to their estimation, that is a return of approximately 30 million products.
Yes, a high volume of returns, whether acceptable or unwanted, can present logistical hurdles and business challenges. However, the massive influx of data that can be analyzed from these returns is invaluable.
Discover 5 key returns metrics to assess after Black Friday returns to improve your overall customer experience, protect net revenue, and prepare for an even more successful Black Friday next year.
Assess Black Friday Returns Data Across Sales Channels
Analyzing return rates across sales channels can provide important insights that help businesses identify marketing opportunities, channel-specific issues, product design issues, and more.
It can be beneficial, for instance, to promote products on social channels after discovering that they’ve performed particularly well in-store (and vice versa). The granular data from returns analytics can help businesses understand why those products performed well so they can then offer them in channels where sales are likely to stick and increase net revenue.
Additionally, the increased number of sales and returns can throw a spotlight on channel-specific and product-specific issues. For example, if product descriptions vary across channels, consumers may not receive the necessary product information from one of them. That can lead to higher product returns on one channel.
Improve Retention and Customer Lifetime Value with Behavior Insights From Black Friday Returns
Returns from post-holiday sales(Black Friday, Christmas, etc.) provide a wealth of information regarding customer behaviors. Plus, when you consider that both loyal and new customers may be utilizing Black Friday offers, these insights can be used to increase retention and customer lifetime value year-round.
Insights from new customers shopping on Black Friday can be used to make changes that increase the likelihood of repeat purchases from other new customers throughout the year. Details such as sizing, product details, and customer reviews are all important aspects of that first purchase. If a first-time customer indicates that any of these issues influenced their return, it may be time to adjust those features.
returns analytics can also reveal behaviors from existing shoppers that indicate they’re having a mediocre or poor consumer experience. In this case, granular returns data can help identify areas where even slight improvements may increase customer loyalty. Furthermore, if loyal customers indicate high satisfaction with a particular product, marketing that product to emerging loyal customers can help transition them into a loyal category.
Determine Black Friday Product Return Reasons to Optimize Product Assortment
While the volume of sales that businesses see during Black Friday isn’t representative of sales during the rest of the year, analyzing Black Friday returns provides valuable insights that can be used to optimize product assortment.
For example, returns data can help businesses decide which products to re-order (and how much). Certain product variations (colors, materials, etc.) may resonate with customers more. Conversely, customers may consistently have a negative experience with certain variations. The large number of sales and returns will make it easier to identify products that customers are less likely to return.
Analytics from Black Friday returns can even provide insights that help businesses make product assortment decisions regarding product development, whether to expand or limit garment sizes, and so much more.
Leverage Black Friday Returns Analytics to Optimize Inventory Management
Admittedly, the inventory management needs associated with Black Friday are unique. Inventory holding will increase, additional warehouse staff will be needed, etc. While those same management needs won’t be required year-round, Black Friday returns can still offer insights that help reduce inventory management expenses throughout the year.
While keeping less inventory on hand can reduce risk-holding and warehousing costs, it can also increase the likelihood of stock-outs. Returns data, however, can provide insights that improve the accuracy of inventory forecasting to avoid stock-outs while minimizing warehousing costs.
Speaking of warehousing costs, returns analytics can help optimize warehouse space by identifying categories that are likely to perform well. By allocating additional space to these categories while limiting space to products that don’t perform as well, warehouse space will be utilized more efficiently. What’s particularly important, however, is that analyzing these returns can help businesses optimize their inventory management for Black Friday sales the following year.
Use Returns Data to Optimize Black Friday Revenue NEXT Year
When it comes to developing strategies for a successful Black Friday, assessing the performance of previous Black Fridays is pivotal. That can mean analyzing marketing ROI, top-line sales vs. net revenue, and—you guessed it—returns analytics. This type of granular data can help businesses create data-driven strategies designed to optimize performance, not only on Black Friday, but throughout the year.
For example, returns data can be used to help negotiate terms with suppliers. When negotiating terms with suppliers that incentivize good returns performance, returns analytics are invaluable. It can help avoid unfavorable deals which lead to the retailer bearing a large share of the cost of returns. Additionally, this data can even help retailers collaborate with suppliers on product improvements (specifications, packaging, instructions, web copy, etc.).
Uncover Vital Insights From Black Friday Returns with Returnalyze
With Black Friday nearly upon us, it’s important to remember that it’s not just about top-line sales. Yes, that initial sales boost is exciting, but returns will cut into those profits and negatively impact net revenue. That’s why having a plan to analyze returns analytics is so important. This data can help businesses make important decisions for the upcoming year and for the following Black Friday.
That’s why the Returnalyze Intelligent Dashboard gives businesses access to detailed analytics that make it easier to identify issues, opportunities, and develop data-driven solutions. In addition, a partnership with Returnalyze comes with step-by-step guidance and expert data analysis so businesses can leverage this information efficiently and effectively.