In this episode, Vito Petruzzelli talks with Rajesh Ramanand, the Founder and CEO of Signifyd and a seasoned expert with nearly 25 years in retail and ecommerce, for an in-depth discussion on the growing challenge of product returns in the digital marketplace.
They kick things off by exploring how the convenience of online shopping has led to a staggering volume of returns—nearing $900 billion annually in the US alone—and how retailers are struggling to replicate the in-store experience, where returns often lead to additional purchases. Raj emphasizes that while brick-and-mortar stores could recapture lost revenue by encouraging customers to shop after a return, recreating that journey online remains a significant hurdle.
A key point of the conversation centers on the hidden costs and organizational fragmentation surrounding returns. Vito and Raj shine a light on how returns have long been accepted as a standard part of business, leading to a lack of clarity and ownership over the issue. Raj explains that no single department oversees the entire returns process; data is scattered across multiple teams, making it almost impossible to identify patterns of negligent or abusive returns, promotional gaming, and supply chain-related errors like inconsistent sizing. By breaking down the avoidable portion of returns—estimated at roughly 50%—the episode provides actionable insights into how retailers can use unified data and analytics to both minimize avoidable returns and improve overall margins.
Looking to the future, the discussion shifts to technology-driven opportunities in the returns ecosystem. Raj highlights the promise of instant refunds for trusted customers, revealing that such measures can prompt 40% of returners to make immediate repeat purchases—helping merchants offset both the direct and indirect costs of returns. He concludes by advising retail leaders to establish clear ownership of the returns function, invest in holistic data analysis, and deploy targeted strategies that reduce costs while maximizing customer value. The episode offers strategic guidance and real-world examples, making it a must-listen for anyone in retail, ecommerce, or revenue management.
Chapters:
00:00 Recreating In-Store Shopping Online
06:26 Return Management: Boosting Profits
08:56 Strategies for Managing Retail Returns
13:22 Challenges in Assessing Purchase Intent
15:39 Risk Management through Data Integration
18:07 Instant Refunds Boost Online Sales
22:37 Reducing Ecommerce Return Rates
23:55 Streamlining Returns Management