Peak Season for Holiday Returns & Expectations Are High

December 30, 2024  by Karen Parrish in Business Strategy, Industry   

In a report conducted by the National Retail Federation and Happy Returns at the beginning of December, it was estimated the percentage of returns could reach 17% (16.9%).

Both organizations recognized the value that returns have in the customers' overall experience. The availability of free returns, "improving the returns experience and reducing the return rate are two of the most important elements for businesses in achieving their 2025 goals."

The NRF report also cited that in response to consumer demand, retailers are looking to "enhance the return experience for customers." That includes upgrading the experience, adding flexibility in the process, and making things easier for consumers (including no box/no label & immediate returns).

“Physical stores are no longer just sales hubs; they are becoming essential for efficient returns management,” said James Breeze, vice president of global industrial and retail research for CBRE. “Leveraging in-store returns will be a game changer for retailers looking to lower shipping and warehousing costs, enhance customer satisfaction and drive foot traffic for additional sales opportunities.”

Balancing consumer demand and rising costs is a fine line. Fraudulent and abusive return practices that create logistical and financial challenges are a significant issue. The NRF report states, "In terms of abuse, bracketing – purchasing multiple items with the intent to return some – has seen growth among younger consumers, with 51% of Gen Z consumers indicating they engage in this practice."

“Return policies are no longer just a post-purchase consideration – they’re shaping how younger generations shop from the start,” said David Sobie, co-founder and CEO of Happy Returns. “With behaviors like bracketing and rising return rates putting strain on traditional systems, retailers need to rethink reverse logistics. Solutions like no box/no label returns with item verification enable immediate refunds, meeting customer expectations for convenience while increasing accuracy, reducing fraud and helping to protect profitability in a competitive market.”

CBRE concludes, with e-commerce sales projected to grow significantly, reaching 35% of total retail sales by 2035, demand for physical stores equipped to handle returns and provide enhanced customer service is set to rise.

Read the CBRE Article on Holiday Returns Expectations.
Read the entire NRF & Happy Returns 2024 Consumer Returns in the Retail Industry Report