How many times have you thought about buying something online, only to not pull the trigger because of the thought of having to return for one reason or another? And if you’re an online retailer, how much business have you missed because of fear of the “return shipping process?”
This dilemma is what drove Clarus Marketing to introduce a new annual subscription service that allows consumers to return unwanted products to online retailers – without having to pay any return shipping costs. Tom Caporaso, CEO of Clarus, joins us to discuss why this service called Return Saver is the Amazon Prime of return shipping, how it benefits consumers willing to pay an annual fee for the ability to return items, and how it will impact eCommerce overall.
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Small Business Trends: Can you give us a little bit of your background?
Tom Caporaso: We’ve been around for 13 plus years now. Many years ago we launched Freeshipping.com, which was the pioneer in prepaid shipping programs four or five years before Amazon Prime came out. We’ve been building the business around subscription programs for many years now and we’re very excited about Return Saver being the “first of its kind” that focuses on return shipping and the pain point that consumers have.
Small Business Trends: Can you talk about what Return Saver is?
Tom Caporaso: It’s a flat fee subscription, $49.00 annually. Consumers can go to ReturnSaver.com and join.
For that fee they get return shipping regardless of where their product was shipped from. So, if they shopped at Kohl’s or Wal-Mart or any of the other retailers online, they could come to Return Saver, print off a label, slap it on their box and drop it off at any of the FedEx locations.
We partnered with FedEx as our logistics carrier for Return Saver, and we’ve leveraged all of their technology to really tap into their back-end logistics as well as their physical store locations. So, regardless of where they shop from, they come to Return Saver, they print off a label and ultimately drop it off at a FedEx location.
From a consumer standpoint, return shipping is still very much a fee that the consumer has to pay. While they may get a free return label from some of these retailers, in most cases, that return shipping fee gets pulled out of their refund when they return the package. So, it’s a very simple, easy way to use the program and ultimately get those free returns for a flat fee.
For a retailer, consumers are looking at return policies to ultimately make a purchase decision. They’re looking at the return policy to make sure it’s free, and how easy it is to use. Data says 66% of those people actually look at a return policy before making a purchase.
So as we think about the value to retailers, we ultimately think that Return Saver is going to allow the consumer to buy more and worry less. So, if you have two or three shirts in your cart, you’re not quite sure, you have the peace of knowing that you can return them through Return Saver free of charge.
Small Business Trends: It looks like there’s a number here, 95% of customers become repeat customers after a positive return experience?
Tom Caporaso: That’s absolutely right. As people get more comfortable with Return Saver and see how easy it is to use, we think across the Web and across retailers, people are going to ultimately buy more because they don’t have to worry about either the process or the price around return shipping.
Small Business Trends: The interesting part around this is you just introduced a subscription service that consumers can pay $49.00 for a year to make sure that they’re able to return things free of charge. Why do you think now is the time to offer that to consumers?
Tom Caporaso: As more and more retailers move to free shipping or threshold-based free shipping, return shipping is still very much a pain point for consumers both on price and process. And as we talk to our consumers in Freeshipping.com as well as looking at the data that’s out there, it’s just a really interesting opportunity for us to answer that pain point. So it just felt like the time was right to address it.
Small Business Trends: Can you speak at a high level briefly as to the process someone would go to if they are a Return Saver member, and have something they need to ship back?
Tom Caporaso: They go to Return Saver. If they’re not a member, they can join. They give us their information and get access to the site.
If they’re already a member they sign in. They put in their information where the purchase needs to be returned to. We also load in the return policies of a lot of the very large retailers out there. So for instance, if the return policy is free returns, we’re actually going to drive the consumer back to that site to make a free return.
Most cases, retailers do not do free returns, so the next step is essentially put in all that information, print out a label, put it on a box and drop if off at a FedEx location and their done. We’ve built in all the capability on the back end to track that package, to make sure it ultimately gets to the Kohl’s warehouse so they can also track their refund, and make sure that Kohl’s refunds them.
Small Business Trends: From the consumer standpoint, it doesn’t matter where they buy something online?
Tom Caporaso: It doesn’t. We wanted to make the program very broad.
Small Business Trends: What do you think the overall impact on eCommerce could be with a service like this that, as you said, removes the point of contention between consumers and online retailers?
Tom Caporaso: The key for us is to drive consumers into Return Saver and get them starting to use it. I think once they see how easy it is, those members are going to transact more across the Web. I think it will have a ripple effect on more purchases across the Web because they’re covered.
Small Business Trends: Where can people learn more about Return Saver?
Tom Caporaso: They could go to ReturnSaver.com.
This is part of the One-on-One Interview series with thought leaders. The transcript has been edited for publication. If it's an audio or video interview, click on the embedded player above, or subscribe via iTunes or via Stitcher.