Close Menu

Reducing Holiday Season Returns: A Sustainable and Customer-Focused Approach

2 min read

As the holiday season approaches, brands know they need to gear up for the surge in sales, which can make or break their profitability for the year. But they may be less excited about planning for the inevitable spike in returns. Per the National Retail Federation (NRF), last year, retailers expected returns to amount to approximately 17.9% of their holiday sales. Processing a massive number of returns is unsustainable – both financially and in terms of environmental responsibility. As retailers look for ways to reduce these numbers, some have chosen to sharply curtail their return policies, but an improved customer experience when making sales can, in and of itself, significantly contribute to reducing returns. At XY Retail, we believe that the key to successfully reducing returns is not the institution of more rules, but leveraging the power of clienteling and AI-powered recommendations.

Personalized Shopping Experience with AI and Clienteling

One effective strategy to reduce returns is through AI-powered recommendations and clienteling. Here is one example: each holiday season, whether they’re attending a family gathering or a New Years’ event or both, customers are searching for the perfect party outfits, and the challenge is to find the right fit, style, and size. To fuel better recommendations, AI-powered clienteling tools can analyze past purchasing behavior, browsing patterns, and individual preferences to suggest outfits that customers are more likely to be satisfied with. Whether online or combined with the in-store expertise of a sales associate, this personalized shopping experience not only enhances customer satisfaction but also significantly reduces the chances of bracketing, where customers buy multiple sizes or styles with the intention of returning some. By ensuring customers get it right the first time, brands can see a notable decrease in returns, contributing to sustainability goals.

These types of recommendations also make your customers better gift-givers. During the holiday season, many shoppers who are looking for the perfect gift will have a general idea, but need assistance refining it down to specifics. And, when they’ve found just the right gift but it’s not in stock in the recipient’s size or favorite color – ensure that you’ve got access to your entire inventory to help them get it right. Clienteling tools equip sales associates with real-time access to inventory across all locations, including different sizes or colors available in-store or at a warehouse. Furthermore, with options to ship to the store, the gift giver, or directly to the recipient, these tools add a layer of convenience and flexibility, enhancing the overall customer experience.


A Radical Rethink: Prevent Returns, Don’t Micromanage Them 

In conclusion, the holiday season presents a unique opportunity for brands to rethink their approach to returns. Preventing returns by empowering shoppers to make more intelligent purchases is a much more customer-friendly approach than instituting increasingly lengthy returns policies. By focusing on sustainability and customer experience through advanced clienteling and AI recommendations, brands can not only reduce their environmental impact but also build stronger relationships with their customers. At XY Retail, we are committed to providing solutions that empower brands to achieve these goals, making the holiday season a time of joy and sustainability.


January is peak return season, and if you’re feeling overwhelmed, be sure to visit us at booth 1335 at NRF 2024: Retail’s Big Show at the Javits Center in NYC from January 14-16. Click here to set up an appointment to see a demo!