You’re staring at a mountain of returned parcels, each representing a dissatisfied customer and lost revenue. Imagine if you could stop those returns before they happen. It’s not merely a retail fantasy. 2024 data from DHL eCommerce tells us more than a quarter of returns (26%) happen because something doesn’t fit, 23% because of quality issues, and 10% because items don’t match their glamorous website photos. Consider it the online retail equivalent of a bad blind date: expectations rarely meet reality.
“Online shopping experiences are 2D,” says Tony Sciarrotta, Executive Director of the Reverse Logistics Association. “Customers can’t touch, try or feel the products in real life.” It’s like trying to judge a meal by its menu description – sometimes you just need to see it in person.
Technology is the game changer
Enter AR and VR, the retail power couple. In 2019, John Lewis launched the ‘Visualise Your Space‘ AR tool to help customers see how that gorgeous sofa would look in their living room before it arrived and blocked their doorway.
Fashion retailers are not far behind. ASOS rolled out its Virtual Catwalk and ‘See My Fit‘ features, turning smartphone screens into personal fashion shows.
Contrary to what some retailers may believe, consumers are eager for these technologies. According to research, seven out of 10 shoppers believe AR apps would influence them to shop more frequently. This is consistent with the broader market prediction that the AR/VR market will nearly double between 2025 and 2028.
The business case for prevention
The true cost of returns goes beyond processing. Retailers face:
- Warehouse handling costs
- Shipping expenses
- Customer service time
- Potential product depreciation
- Environmental impact
- Lost sales opportunities
Retailers are well aware of the impact delivery preferences have on sales. According to the DHL research, 48% of global online shoppers frequently abandon their baskets when their preferred delivery option isn’t available. However, by investing in AR/VR technologies, retailers could address both delivery and returns challenges by:
- Reducing return rates
- Improving customer confidence in purchases
- Increasing conversion rates
- Enhancing sustainability credentials
- Reducing customer service queries
Looking forward
As AR/VR technologies become more sophisticated and widely used, we may see a fundamental shift in online retail. Instead of competing solely on free returns, retailers will most likely pivot their focus to providing exceptional virtual try-on experiences and product visualisation tools. This evolution provides numerous benefits: customers gain greater confidence in their purchases, retailers can reduce costs while simultaneously enhancing sustainability, and the environment benefits from fewer delivery vehicles.
The question is not whether we should invest in these technologies, but when. With the AR/VR market expected to double in the coming years, early adopters will gain significant competitive advantages. Those who delay may find it difficult to catch up in a market where customers expect sophisticated virtual try-on options as standard.
While free returns are unlikely to disappear overnight, the future of online retail may be about making returns unnecessary rather than. As Tony Sciarrotta suggests, perhaps it’s time to shift the emphasis from processing returns to preventing them in the first place.
The technology exists. The marketplace is ready. The business case is clear. The only question is: which retailers will spearhead the revolution?