Sometimes they come back
The challenge of managing returns.
The boom in sales from e-commerce channels in the fashion and luxury industry has been consolidated even in the post-lockdown period. Currently, this trend represents not only an opportunity, but also a challenge for fashion houses, since, in relation to sales, the volume of returns to be managed has also increased.
In the last two years, phenomena such as "bracketing", "wardrobing" and "instashopping" - which we will illustrate in detail later – have taken hold. Those phenomena, combined with more traditional wrong purchase cases, have contributed to generating enormous quantities of returns. It goes without saying that returns management impacts logistics processes and, above all, drains financial resources, to the point of becoming a problem that is no longer negligible and that deserves to be addressed with suitable technological solutions.
In this article, we will explain how to use smart tags to simplify the return management process, thereby reducing costs and successfully solving the most controversial cases, which often cause deleterious contrasts between legitimate brand interests and consumer satisfaction.
The explosion of reverse logistics
The so-called reverse logistics – i.e., those logistics processes that bring products returned by consumers back to the headquarters, shops, and warehouses - is becoming enormous, as confirmed by data published by several sources:
This is a topic that companies in this industry must approach very carefully, with the aim of implementing efficient management processes that exploit appropriate traceability technologies. The optimisation of processes obviously translates into savings, but it is also closely linked to the topic of sustainability: Optoro, a return management service, estimates that the handling of returns in the United States alone generates 15 million tons of CO2 emissions per year.
Appearances are deceiving: distinguishing physiological returns from fraudulent returns
In Italy, we use the expression "Every law has its loophole" to indicate the ability to quickly adapt to new rules, processes and trends, by developing methods to circumvent the rules just as quickly or exploit hidden opportunities.
Even returns, which started off as a service for the benefit of consumers, have suffered the same unpleasant fate and have become the object of exploitation and deception by parties motivated by non-transparent or even shady intentions. This regards, for instance, those who return an item not because the size is not right or they don’t like the product, but for much more futile - sometimes fraudulent - reasons.
However, in the present day, technology helps to identify illegitimate behaviors more easily, making it possible to stem the effects, without penalizing those who use the service correctly and appreciate it.
We can generically summarise the phenomena that lead to returns in five categories:
The use of smart tags to univocally identify original products and govern the return process
Connecting products to a smart tag allows brands to have immediate access to information related to commercial traceability and authenticity of products, and break down the most serious phenomenon among the fraud we have listed, that of returning counterfeit items instead of original ones.
We have developed applications for professional use that, using the same smart tag through which end customers can verify authenticity, enable a procedure that helps store or warehouse clerks in charge of returns to identify fakes in a few seconds and unequivocally.
If this application is linked to the verification of authenticity carried out by consumers, and this becomes an essential condition for starting a return request, the attempt to return fakes is nipped in the bud, to the benefit of brands, and of all honest consumers.
Basically, equipping products with a digital identity capable of returning information about them and their movements throughout their life cycle, is an investment that generates a return for brands, whatever the circumstances in which that digital identity is challenged ... even when products sometimes do come back.
Get in touch with us to find out how easy it is to transform your physical products into connected ones, or how to infuse new energy into a smart tagging project that benefits your business and consumers.