As the new year dawns, consumers facing buyer’s remorse find solace in the ease of returns, yet for retailers, this perpetual struggle against returns looms larger than ever.
A staggering $743 billion worth of merchandise was returned in 2023, a sobering 14.5% return rate, according to the National Retail Federation. The online sphere, with a hefty 17.6% return rate, bears the brunt compared to brick-and-mortar's 10%.
The antidote to this retail woe seems to lie in the realm of advanced technology, particularly artificial intelligence (AI). This tech strives to prevent returns at their source by leveraging innovative tools and tactics.
Zalando, for instance, unveiled a digital body measurement tool last July, empowering shoppers to ascertain clothing sizes through just two photos. Other trailblazers like Maison Valentino embrace augmented reality for virtual try-ons, thanks to firms like Wanna.
But AI's influence transcends mere 'try before you buy.' Amazon's adoption of AI to preemptively detect damaged goods before dispatch curtails future returns. Trained with images of intact items, this tech identifies damaged products within the shipping process, rerouting them for manual inspection.
Meanwhile, Asos, the online fashion giant, uses AI to scrutinize return data, pinpointing high-return items and brands. Insights gleaned facilitate tailored recommendations, enhancing the customer experience.
The shift to AI-driven strategies marks a pivotal moment in retail, where technology stands as the vanguard against the perennial returns challenge. As the battle rages on, these innovations offer a glimmer of hope for retailers striving to stem the tide of returns and bolster customer satisfaction.