61% of consumers in the US and UK say that viewing user-generated visual content (UGC) from other customers can reduce the growth of fashion e-commerce returns, hitting retailers’ profitability and sustainability goals. And about half of consumers agree that returning fashion purchases online is bad for the environment
NEW YORK and LONDON (July 14, 2022) – 61%[1] of consumers surveyed in a new survey believe that fashion retailers can reduce the rapidly rising rate of e-commerce returns by including more post-purchase photos and videos from other customers to help shoppers see how the clothes look on “real” people, and not just on models. 59% say that virtual fitting technology, which allows shoppers to imagine themselves in the clothes they find online, will also help deter returns.
The findings come from a survey of just over 2,000 US and UK consumers commissioned by Nosto, the Commerce Experience Platform used by fashion brands such as Patagonia, Paul Smith, Pangaia and Todd Snyder.
The new research comes as revenue growth is reportedly hurting the profitability of online fashion brands such as ASOS and Boohoo. In the US, average e-commerce returns jumped to 20.8% in 2021, with an estimated $671 billion in product returns.
The increase in e-commerce revenue reduces profits by increasing retailers’ shipping and warehousing costs (increasing costs by 21% of the product order value). There’s also the problem that returned inventory has a negative impact on the environment: the annual carbon emissions from transporting returned goods in the U.S. are estimated to equate to 3 million more cars on the road.
Fashion retail brands are also increasingly aware that poor sustainability and environmental performance can damage their credibility. Recently, several brands, including H&M, have stopped using a tool that attempts to measure the sustainability of clothes due to concerns about greenwashing.
Importantly, respondents to the Nosto survey were more than twice as likely to agree that profits hurt the environment than to disagree (49% vs. 17%[2]) based on the return of waste fuel, packaging and other resources.
“Polished studio images have been the standard way to display clothing in e-commerce stores. But complementing this with customers’ own images gives shoppers a more accurate representation of how the products are worn in everyday situations and ‘ordinary people’ who also own the items,” says Damien Mahoney, Chief Strategy Officer at Nosto.
“That’s why fashion retailers use visual customer UGC on their websites, such as post-purchase selfies they encourage customers to share on Instagram. The most savvy retailers also encourage their customers to comment on suitable products or share their measurements in their signatures so others can make comparisons that better inform purchasing decisions and thus reduce returns.”
A separate study last year by Stackla, a visual UGC platform (now part of Nosto), found that consumers are very happy to allow fashion retailers to use their selfies after a purchase – 58% would allow brands to use images of their fashion purchases. as part of their marketing.
Along with greater use of UGC, nearly half (49%) of consumers surveyed by Nosto agreed that charging customers for returns — or ending free returns, as Zara recently started doing — could stem the flow of products that fashion shoppers sent back, causing them to think more carefully about whether they are going to keep the product before placing an order.
And research shows that retailers should continue to pay close attention to some of the more basic tactics to help reduce profitability. This includes taking steps to ensure that online information is clear, accurate and detailed (66%), that orders are not damaged before they are shipped, and that the correct items are packaged (also 66%).
Read more from Nosto’s research in the company’s blog post. These are initial findings from a wider study of consumer attitudes towards sustainability in fashion retail, to be published by Nosto later in 2022.
[1] Respondents were asked whether they completely agree, partially agree, neither agree nor disagree, partially disagree, and completely disagree with a list of statements. In almost the entire press release, the answers “Strongly agree” and “Partly agree” were added together when the results were discussed.
[2] Aggregate 17% of respondents who answered “Somewhat Disagree” or “Strongly Disagree” to the following: I believe that returning fashion products purchased online is bad for the environment because it uses up fuel, packaging and other resources.
