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What influences customer satisfaction? - How to respond to online product returns?

Hanna Bernikova
12/12/2023 | 8 min read
What influences customer satisfaction? - How to respond to online product returns?

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    There is no denying that there is a connection between customer service and company profitability, it is a well-known fact. Therefore, customer retention is a key task for every business, which affects the company's revenue. Most companies include continuous monitoring of customer satisfaction as part of their marketing strategy. As we know, a satisfied customer is more likely to make a repeat purchase.

     

    Statistical research only proves how customer dissatisfaction negatively affects business, namely leading to a loss of 10% to 30% of customers. Many companies have long been monitoring the level of customer satisfaction, paying attention to research results.

     

    • B2B: the standard level of customer satisfaction is 95%, a result below this value is considered critical.
    • B2C: the standard should exceed 80%.

     

    In order for customers to be increasingly satisfied and loyal to an online store, marketing and sales experts have come up with related concepts: guarantee and complaint. One word derives from the other, they cannot exist separately. Guarantee and complaint together create a so-called barrier, customer protection during purchases (especially online). Thus, these processes affect customer satisfaction with items purchased online.

     

    Guarantee and warranty - how to take care of customer satisfaction?

     

    The definition of the word guarantee - voluntary responsibility of the entrepreneur towards the customer, consisting of ensuring good quality of the product or service. The specific warranty period is determined by the owner on his own terms, so that the customer feels as safe as possible during online and regular store purchases. The guarantee often includes product repair.

     

    There is another type of guarantee - warranty, which gives the customer 100% certainty about the possibility of returning the goods in case of defects caused by the entrepreneur. The company owner, according to the law, must return the goods, offer a discount, or repair the defects, because the customer received a product that does not match the description on the website.

     

    In any case, both guarantee and warranty provide the possibility of returning the goods.

     

    Complaints - a step towards development or business failure?

     

    It often happens that a consumer is not satisfied with the purchased service or product. In such a case, he is forced to organize a return, in accordance with the provisions of the law and the clauses provided in the warranty document. This process is called a complaint.

     

    Do you think complaints are a bad sign for business? Indeed, a complaint means that your product is of poor quality or does not meet the expectations of new customers. As a business owner, you may lose part of your income due to a large number of returns. But experienced business owners often take into account these potential financial losses - 33% of online stores offer free returns, but compensate for these costs through paid delivery, and 20% of e-stores have raised the price of the product to cover the costs of possible complaints.

     

    However, a complaint is not always a negative attribute. The return of products is a process that shows you, as a business owner, the level of quality and demand for your services or products.

     

    Novice entrepreneurs often think that business development is about increasing revenue, so they should only focus on sales. Unfortunately, this approach to business management is short-term, and it is not in vain that 9 out of 10 companies go bankrupt within the first year of their existence. Customer service quality and maintaining contact with customers are much more important, as they determine the true development of any business. It is worth communicating with buyers even after purchases, building relationships with them, increasing their loyalty to your store, and of course, ultimately helping them become repeat customers.

     

    As research by consulting firm Invesp shows, as many as 30% of buyers file complaints about products from online stores. But there is nothing wrong with that. Most often, consumers return goods for the following reasons:

     

    • the goods arrived already damaged - 20%
    • the product does not match the description - 22%
    • receiving a different product - 23%
    • other reasons - 35%

     

    By analyzing the reasons for returns, you can identify the weak points of your business: inaccuracies in warehouse work, poor quality of production, or maybe a problem with delivery or improper packaging.

     

    A complaint allows you to increase customer satisfaction by presenting your company as reliable and loyal to customers in a stressful situation. Statistics from Invesp indicate that as many as 92% of customers are willing to make a repeat purchase in a store that successfully resolves complaints. Why does this happen? Accepting a complaint gives the customer the assurance that they have not been deceived in this store, and they and their money are protected from fraudsters. Convenient complaint conditions, therefore, have a positive impact on customer experience.

     

    Product returns

     

    Serial returners - scammers?

     

    In Europe, there is a term that describes a category of customers who constantly make returns - serial returners. A few years ago, the British company Barclaycard revealed in its research that 30% of buyers intentionally buy more goods from online stores in order to later return part of the purchases, and 19% order different versions of the same product and decide to purchase only one of them upon delivery.

     

    Can you avoid complaints by removing this option from your store?

     

    Unfortunately, according to TrueShip, 63% of returns are the seller's fault. So, 23% of returns are related to incorrectly shipped goods, 20% of returns occur because the product is defective, and 23% of returns result from the fact that the received product differs from the one shown in the online photo.

     

    Therefore, it is better not to remove the return option from your online store, as it can significantly reduce sales - 63% of consumers are more willing to buy goods online if they know they can make a complaint.

     

    In addition, 67% of consumers familiarize themselves with the rules of returning goods before making a purchase. This means that over half of the consumers visiting online stores want to be protected from unsuccessful purchases, and the store owner must provide them with this protection, otherwise they may lose up to 50% of potential customers.

     

    10 principles of responding to complaints

     

    1. Respond to customer messages as quickly as possible, checking all communication channels. Listen carefully/read the complaint, showing concern for the problem.
    2. Accept criticism appropriately. Give yourself a few minutes to think about what you have read and analyze the situation.
    3. Always behave like a professional. Regardless of how the customer addresses you, always treat them with respect.
    4. Determine what actions are worth taking to solve the problem. If you need a few days to meet your customers' needs, do not hesitate to write about it in an email or in response to a comment.
    5. Thank the customer for their feedback regardless of its sentiment. Remember that negative reviews can show you what else is worth improving in the functioning of the store to increase customer satisfaction.
    6. Apologize for any inconvenience the customer experienced during their purchases in your store. Clarify to the buyer the reasons for the problem.
    7. Clearly describe your action plan, namely how you will solve the customer's problem: refund the money, repair the product at the service center, or provide a coupon.
    8. Conduct customer satisfaction surveys after proposing a solution, for example, through a survey. After a few days, or even hours, depending on the severity of the problem, write to the customer and find out if they are satisfied with the current situation.
    9. Modify your company based on the previously identified problem. It is worth combining all complaints related to your online store and decide to change part of your business strategy. For example, it is worth changing production methods if most people return goods due to unsatisfactory quality.
    10. Prepare a ready-made response plan for emerging customer questions and problems.

     

    complaint vs guarantee

     

    How to effectively monitor your customers' complaints?

     

    For customers, it is important that the owner of the online store where they made a purchase responds to their comments, both positive and negative. By talking to your customers, you increase loyalty to your brand and the number of repeat customers.

     

    Sometimes it is difficult to track every comment, as store products can be displayed on various platforms at the same time: Allegro, Ceneo, Amazon, etc. In such a situation, it is convenient to use a ready-made solution, namely an application for managing reviews from various platforms in one place.

     

    One of such tools is Rating Captain. Rating Captain uses machine learning to determine the level of customer satisfaction based on published reviews. The application shows the current situation of your company, helps effectively respond to negative and positive comments, and solve customer problems, which in a few months can result in your company receiving significantly fewer complaints and even increasing sales by 60%.

     

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