Regardless of what industry you're in, what type of products you sell, or who your customers are, refunds will always be part of the e-commerce process. It's a nuisance to have to deal with, and it can get a little disheartening at times, but keep in mind, there are a ton of reasons why products get returned.
Whose fault is it anyway?
There are many reasons why orders get returned - and no, they aren't always seller faults (although some could be). When people refund orders, it's often due to reasons involving either the Seller, Amazon/Carrier, or Customer.
Whoever this 'blame' lands on determines who is responsible for the shipping costs. Typically, customers are at fault when the reasons are associated with preference (size, color, etc.) and sellers fault if there are functionality/damage-related issues (shattered, not as described, missing pieces).
For whatever reason, once the customer initiates a refund and the product gets returned, Amazon will evaluate the unit's condition and whether it can or cannot be sold again. If it is in good condition, Amazon will return the product to inventory, and if not, it will be deemed unsellable, which in this case, the Seller can have removed or disposed of.
Why It's Important to Keep your Returns Low
Keeping track of why your products get returned can help you identify critical issues that you can use to improve your product, customer experience, or listing. Take, for example, a reoccurring complaint of a glass product arriving damaged. These complaints indicate that your products require reinforced packaging to protect them during transportation. If your complaints are continuous, your seller's health could be at risk, and your listing could potentially shut down. Continuously monitor your return rates and customer voices for optimal seller health.
How to Help Reduce Returns
If you notice an uptick in customer refunds, using the list above is a great place to get started. Ultimately, we all want our customers to be happy with their order, so providing shoppers with the information they need and realistic expectations will contribute to their overall satisfaction with your products.
THIS WEEK'S BITES
April 5, 2021 - Carrier Names Required: You will be required to provide the carrier name (that is, the carrier-code field) when you confirm shipments via bulk feeds, APIs, or integrators. Some of the commonly used carrier names are USPS, UPS, and FedEx.
May 3, 2021 - Upcoming changes in shipment confirmation: Amazon will validate tracking details (including the carrier name and tracking ID) for all seller-fulfilled orders and show warnings for invalid tracking details.
May 31, 2021 - Extended disbursement reserve period: Sellers who continue to use a bank account from a non-participating PSP after this date will be subject to an extended disbursement reserve period of up to 21 days after the latest estimated delivery date.
June 21, 2021 - Update to Amazon US referral and FBA fees: Amazon is making modest increases (about 2-3% on average) to fulfillment fees, in line with or below industry averages. We will also reduce certain fees, like the returns processing fee.July 15, 2021 - Disbursements stop for non-approved PSP to sellers using non-participating PSPs until they switch to a participating PSP or use a bank account directly issued by a deposit-taking bank
NEW ON AMAZON
Amazon is continuously innovating its marketplace features, and we love it. Amazon Posts became available in 2019 as an introduction to social commerce on this platform. It's a fun and engaging way for sellers to share inspiring content about brand values, educates shoppers about different store offerings, and, best of all, it's free. According to Feedvisor, in 2020, there were over 80 million U.S. social commerce buyers. This number is likely to increase by 12.9% in 2021 and by 2023, up to 101 million social commerce buyers in the U.S.
What are Amazon Posts
Simply put, Amazon Post is a free advertising feature that takes on the style of common social media platforms - a product-centric image, a caption, and a feed. They appear on your brand's feed, detail pages, related products, and category-based feeds, which means your brand's product post could arise when someone is on a competitors listing (ka-ching)! Ultimately, if you're looking for opportunities to showcase your brand even further on this marketplace, Amazon Posts is the way to go.
Posts are a great free resource on Amazon available to those enrolled in Amazon Brand Registry.
Keep in mind, this feature is still in beta, so while you can take advantage of these fantastic features, changes and updates are expected. Either way, we anticipate great things from Amazon posts. This feature is sure to win over customers with the freedom to upload eye-catching images and share engaging captions.
TRENDS TO FOLLOW
ACoS (Advertising Costs of Sales) is one of the most important metrics to keep track of when it comes to advertising on Amazon. It is the average percentage of each sale spent on advertising and sums up how efficient your advertising strategy is.Generally, the target is a low ACoS since that would indicate that you are spending less on advertising per sale, but stating what “low” can vary based on your goals and industry. Reddit User r/AdAdvance demonstrates in this post the benchmark by category:
According to this data source, the above information is based on a collection of 100 reports pulled through the Advertising API and then averaged across each category. Results will vary, but this data provides some fascinating insight into how the ACoS ranges among categories. ACoS is a critical metric, but it should not be the only focus. Several factors affect your ACoS and should be considered when reviewing your sponsored ads' condition (CPC, Conversion Rate, Average Order Value).
If you're trying to reduce your ACoS, consider the following suggestions:
If you sell on Amazon and your inventory is not depleting, that's usually a red flag. There are several reasons why your merchandise might not be selling but it's not always clear why. If you're noticing a lack of progression in your stock and slower sales, consider the following quick tips to resolve issues and stimulate some sales
You may find that these minor changes could be the quick fix you need to get ‘em up and moving!