Retailers Struggle to Combat Growing Issue Amid Changing Policies
- Retailers lost $103 billion in fraudulent returns and claims in 2024
- Fraudulent returns accounted for 15% of the projected $685 billion in returns last year
- 84% of retail executives changed return policies in the past year
- Stricter return policies not reducing fraud effectively
- Online return rate at 24.5%, in-store at 8.7%
- Nearly 40% consumers return at least one online item per month
- Returns are a significant cost for retailers, impacting customer loyalty
A recent report from Appriss Retail and Deloitte reveals that fraudulent returns cost retailers $103 billion in 2024, accounting for 15% of the projected $685 billion in returns. The study analyzed data from over 60 U.S. retailers, the U.S. Census Bureau, and a survey by Informa TechTarget’s content marketing arm involving 150 retail executives and 1,000 consumers. As return policies change to combat excessive returns, retailers must balance customer loyalty while minimizing losses. Online sales return rate is 24.5%, compared to 8.7% for in-store purchases. With e-commerce growth, the cost of returns becomes more significant.
Factuality Level: 8
Factuality Justification: The article provides relevant information about retailers adjusting their return policies due to fraudulent returns and includes data from various sources such as surveys and the U.S. Census Bureau. It also quotes experts in the field and discloses that StudioID is a content marketing division of Informa TechTarget, which has no influence over Retail Dive’s coverage.
Noise Level: 3
Noise Justification: The article provides relevant information about retailers adjusting their return policies due to fraud concerns and includes data from various sources. However, it could benefit from more in-depth analysis of the long-term consequences and potential solutions for both retailers and consumers.
Financial Relevance: Yes
Financial Markets Impacted: No
Financial Rating Justification: The article discusses the impact of return policies on retailers and their efforts to combat fraud, which can affect their financial losses. It mentions specific retailers like REI, Bath & Body Works, and L.L. Bean. However, it does not directly mention any specific financial markets being impacted.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Extreme Rating Justification: There is no extreme event mentioned in the article and it does not discuss any event that happened within the last 48 hours.
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