Browse All Categories
By Returnalyze on August 25, 2023

Can Returns Data Still Be Beneficial When Returns Are Low? Returnalyze

Even when return rates are low, analyzing data from returns transactions can uncover ways to improve customer experiences and increase net profits.

In a perfect world, your customers will always sail through the buying process, be satisfied with their purchases, and then quickly develop loyalty that leads to additional purchases and even brand advocacy. Sadly, this isn’t the case for even the most successful of businesses. Whether a customer has a negative experience or simply changes their mind, returns happen.

Obviously, the goal is to reduce returns as much as possible to protect your net profits. Once a low return rate has been achieved, you can sit back and relax. Right? 

Well, we suppose you could do that. However, you’d be missing out on valuable opportunities. Data, even the data gained when return rates are low, can be used to improve your customers' experiences and even increase your net profits. 

What is a Low Return Rate?

When someone asks us this question, they may actually be asking us several different things. They may be asking whether their return rates are lower, higher, or on par with similar businesses. They might also be asking what’s considered a low return rate for a particular product. 

Sure, it’s almost always a goal to outperform competitors in various ways, but why stop there? When it comes to return rates, businesses should be maximizing their opportunity.


We’re not saying that answers to these questions can’t be useful, but we have a better question. Who defines a low return rate?

Let us explain. Imagine that a business has a lower return rate compared to one of its competitors. Maybe their competitor has a 10 or 15% return rate, while they only have a 5% return rate. That’s great, right? That depends. Within a business that brings in several million dollars, a 5% return rate is not an insignificant number of returns. While this is just one very simple scenario, it highlights the idea that “low” is subjective. 

Sure, it’s almost always a goal to outperform competitors in various ways, but why stop there? When it comes to return rates, businesses should be maximizing their opportunity. If that 5% return rate from earlier was reduced even by half a percentage point, it could result in a significant bump in net profits.

Data From Low Return Rates Can Still Uncover Opportunities

Even when a business is pleased with its return rates, analyzing the data from those returns can uncover valuable opportunities for improvement. For example, even among items with generally low returns, such as cosmetics, there’s almost always going to be some that aren’t performing as well due to a preventable reason. 

Additionally, returns data can also uncover operational issues that may be contributing to returns. Since operations are always in flux, businesses can experience issues in a myriad of ways, from misships from someone putting an item in the wrong bin at a warehouse to new freight carriers improperly packaging products. Even something like shipping delays can increase the likelihood that a customer will return a product. 

The point is that analyzing data from returns transactions can highlight opportunities for improvement. Even data from relatively low return categories can help businesses improve their customer experience. This kind of attention to detail communicates to customers that you care about their experience, which, in turn, increases loyalty and customer lifetime value. 

Can Returns Data Still Be Beneficial When Returns Are Low | Blog | Returnalyze

Years of Returns Experience Sets Returnalyze Apart

We understand the immense power that data can have for businesses, but that’s because we also understand the importance of testing. At Returnalyze, our experts have years of experience analyzing data from multiple retailers. We know what works and what doesn’t because we’ve helped many different business models.

That’s why access to the Returnalyze Intelligent Dashboard also comes with step-by-step guidance. Yes, you’ll gain access to a wealth of data, but we’ll be by your side to help develop targeted strategies that reduce returns and increase your bottom line—even when your return rates are already low.

If you'd like to see how a partnership with Returnalyze can help you uncover opportunities even when return rates are low, schedule a demo or contact our team today.

Published by Returnalyze August 25, 2023