As an ecommerce business, your returns process can make or break your customer relationships and your bottom line. A smooth, easy returns experience is no longer a nice-to-have – it‘s a must-have. And one of the most critical components of a great returns process is the humble return label.
In this comprehensive guide, we‘ll dive deep into the world of FedEx return labels. As an expert in retail and consumer behavior with over 15 years of experience advising online brands, I‘ll share strategic insights and tactical tips for using return labels to boost customer loyalty, streamline operations, and maximize profitability.
Whether you‘re a seasoned ecommerce veteran or just starting out, this guide will give you the knowledge and tools you need to master the art of the return label. Let‘s get started!
The State of Ecommerce Returns
First, let‘s set the stage with some eye-opening statistics on ecommerce returns:
- The average ecommerce return rate is 20.8%, with some categories like apparel seeing rates as high as 50% (National Retail Federation)
- 67% of shoppers check the returns page before making a purchase (Invesp)
- 92% of consumers surveyed said they would buy again if the product return process is easy (Narvar)
- 79% of consumers want free return shipping (Narvar)
As you can see, returns have a major impact on consumer behavior and purchasing decisions. Offering free, easy returns with a prepaid label is becoming table stakes for online retailers.
But processing returns is costly – reverse logistics costs amount to $50 billion annually for US retailers (Optoro). The key is finding the right balance of providing a great customer experience while managing costs and logistics.
What Exactly Is a FedEx Return Label?
Now that we‘ve covered the why, let‘s talk about the what. A FedEx return label is a prepaid, pre-addressed shipping label that ecommerce businesses can include in outbound packages to simplify the returns process. When a customer wants to return an item, they simply affix the return label and drop off the package at a FedEx location or schedule a pickup. The package gets shipped back to the merchant‘s warehouse or returns center at no cost to the customer.
FedEx return labels work just like regular FedEx shipping labels, except they‘re for return shipments going from the customer back to the merchant. The merchant creates and pays for the label upfront, then gets charged once the label is scanned into the FedEx system.
The 4 Types of FedEx Return Labels
FedEx offers several return label options to fit different business needs and budgets:
1. FedEx Print Return Label
With print return labels, merchants create and print labels themselves and physically include them in outgoing packages. This is a good option for items with high return rates, like apparel, since you only pay for labels that get used.
2. FedEx Email Return Label
Email labels allow merchants to send a digital prepaid label to customers when a return is requested. Customers can print the label at home or show a QR code at a FedEx location to ship the return. This is a more eco-friendly and flexible option.
3. FedEx Express Billable Stamp
Billable stamps are preprinted labels that merchants order from FedEx in advance. Each stamp has a unique tracking number tied to the merchant‘s account. Stamps offer a quick and easy way to include return labels in packages.
4. FedEx Ground Package Returns Program
The FedEx Ground package returns program is designed for merchants who primarily ship via FedEx Ground. Merchants can create return labels to include in packages or provide electronically. The cost is billed once the return is scanned into the FedEx system.
Here‘s a comparison table of the key features and costs of each option:
| Label Type | Delivery Options | Avg. Cost | Best For |
|---|---|---|---|
| Print Label | Ground, Express | $7.75+ | High-return items |
| Email Label | Ground, Express | $7.75+ | Providing labels on-demand |
| Billable Stamp | Express | $20+ | Quick and easy returns |
| Package Returns | Ground | $7.75+ | Ground shipments |
Most merchants use a mix of label types depending on their product mix, return rates, and customer preferences. The key is choosing the options that provide the best experience at the optimal cost.
Why Returns Labels Are a Game-Changer
Including prepaid return labels with your orders is a simple step that can have a big impact on your business. Here are a few key benefits:
Increased Sales and Conversion
A study by the University of Texas found that 63% of online shoppers check the return policy before making a purchase. Free, easy returns remove friction and objections holding a customer back from clicking "Buy". In a survey by Narvar, 74% of consumers cited free return shipping as one of the most important factors when buying online.
Improved Customer Loyalty
96% of consumers who are happy with the returns process said they would shop with that retailer again, per the Narvar study. On the flip side, 69% of shoppers are deterred from buying again from a retailer with a poor returns experience. Return labels are an easy way to wow customers and build long-term brand loyalty.
Faster Turnaround on Returned Inventory
Including return labels with orders means customers can return items immediately rather than putting it off or forgetting about it. This gets returned merchandise back in stock faster so you can resell it to other customers. It also enables you to process refunds and exchanges more efficiently.
Streamlined Operations
Return labels standardize and streamline the returns process on the back end. Having packages come back to a central returns center with consistent labels keeps things organized and efficient. It also reduces customer confusion and support inquiries around returns.
Creating a FedEx Return Label, Step by Step
Creating a FedEx return label online is quick and easy. Here‘s how:
- Log into your FedEx account and go to the "Create Shipment" page
- Select "Return" as the shipment type
- Enter your business address as the return destination and your customer‘s address as the return origin
- Choose your preferred FedEx shipping service (Ground, Express, etc.)
- Select any extra services like signature required if needed
- Enter the package weight and dimensions
- Choose your label printing option – print yourself, email to customer, or use a billable stamp
- Pay for the label with your saved payment method (you‘ll only be charged once it‘s used)
- Print or send the label to your customer
The whole process only takes a few minutes. For more detailed instructions, check out the FedEx return label support page.
Strategies for an Optimal Returns Program
Offering FedEx return labels is a great start, but to really maximize the impact, you need a comprehensive strategy. Here are a few tips I recommend to my ecommerce clients:
1. Make your return policy crystal clear
Spell out your return policy in simple language and make it easy to find on your website. Include details on deadlines, conditions, and how the process works. Transparency builds trust.
2. Choose your shipping options wisely
FedEx offers a range of shipping services at different speeds and costs. Find the sweet spot that gets returns processed quickly without breaking the bank. Generally, FedEx Ground is sufficient unless you need items back faster.
3. Set up a dedicated returns handling process
Make sure returned items are inspected, restocked, and back on the virtual shelves as quickly as possible so you can recoup costs. A streamlined process is key.
4. Monitor your return data
Keep a close eye on your return rate, reasons, and costs. If you see red flags like high return rates on certain SKUs, dig into the root cause and address any product quality or sizing issues.
5. Turn returns into exchanges
Returns aren‘t always a lost cause. Train your customer service team to offer exchanges or credit for alternative items. You can often save the sale while still providing a great experience.
6. Continuously optimize and adjust
Your returns program should evolve with your business. Regularly review your policy and processes and gather customer feedback. Small tweaks can make a big difference in efficiency and satisfaction over time.
With these strategies in place, you‘ll be well-equipped to turn returns into a value driver rather than a cost center. It just takes a proactive, customer-centric approach.
The Environmental Impact of Returns
Returns aren‘t just a financial and operational challenge – they also have a major environmental footprint. An estimated 5 billion pounds of returned goods end up in landfills each year, and return shipping generates significant carbon emissions.
As consumers become more eco-conscious, retailers are starting to rethink returns from a sustainability standpoint. Some brands have even started offering incentives for customers to keep items rather than return them to reduce waste.
FedEx is taking steps to address the environmental impact of returns. They offer paperless return labels to reduce waste, and they‘re investing in electric vehicles and alternative fuels to cut emissions. They‘ve also partnered with organizations like Delivering Good to donate returned items to people in need rather than sending them to landfills.
While there‘s still a lot of progress to be made, offering more sustainable return options is becoming an important consideration for eco-minded shoppers and retailers alike.
The Future of Returns Management
As ecommerce continues to grow and evolve, the returns landscape is shifting as well. Here are a few key trends and innovations I‘m tracking:
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AI-powered returns processing: More retailers are starting to use AI and machine learning to automate and optimize the returns process. Solutions like Optoro use algorithms to determine the best resale channel for each returned item to maximize recovery.
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Returnless refunds: Some retailers are experimenting with offering refunds without requiring customers to physically return low-cost items. It‘s more cost-effective to let customers keep or donate the item than to pay for return shipping and processing.
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In-person returns: While most ecommerce returns happen by mail, some retailers are partnering with brick-and-mortar stores to offer in-person returns. Customers can bring their online returns to a store and get immediate credit, while retailers can consolidate return shipping.
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Resale and recommerce: With the rise of online resale marketplaces, more retailers are finding ways to resell returned items rather than liquidating them for pennies on the dollar. Platforms like thredUP make it easy for retailers to sell returns directly to consumers.
Returns have long been seen as a necessary evil of ecommerce, but forward-thinking retailers are starting to approach them as an opportunity to improve the customer experience, recover revenue, and boost sustainability. The key is staying on top of industry trends and best practices.
The Bottom Line
In ecommerce, your returns program is a reflection of your brand and values. It‘s an integral part of the customer experience that directly impacts your retention, reputation, and revenue. Offering FedEx return labels is a simple but powerful way to elevate your returns game.
Of course, return labels are just one piece of the puzzle. To truly master returns, you need to take a holistic, data-driven approach that puts the customer first while managing costs and logistics. It‘s a tricky balance, but with the right strategies and tools, you can turn returns into a competitive advantage.
I hope this in-depth guide has given you the insights and tactical tips you need to optimize your own returns program. If you implement these best practices with your FedEx return labels, I‘m confident you‘ll start seeing results in no time.
Here‘s to making returns a win-win for you and your customers!
