In our previous blog we looked at how the right customer experience at the checkout can influence consumer spend and loyalty. Speed, convenience, security and choice are all essential for consumers now as they look to confidently and seamlessly pay for their chosen goods and services online.
But what about refunds? It’s an often-neglected area when it comes to the overall customer experience. The truth is that shoppers expect the same speed and convenience from their refund as they do from their original checkout experience. Delivering this can be anything but simple for merchants.
In our new report ‘Turn refunds pain into revenue opportunity’ we explore that very challenge. Bringing together trends and insight from our survey of 10,000 consumers across 10 major markets, with the core issues that 1000 European merchants shared with us in our ecommerce merchant survey, we look at the multiple ‘revenue hits’ that merchants are suffering from slow refunds processes.
While it doesn’t take much research to know that refunds are painful for merchants, our survey revealed just how much it’s costing merchants who have slow, manual refund processes.
Talking to a range of ecommerce merchants, we found that:
25 % of merchants say that handling refunds is one of their biggest challenges
19% of all customer support calls are related to refunds
In some markets, up to 40% of customer support calls are refund-related
Our consumer survey revealed why:
Over 87% of consumers said they would call the merchant to chase up a delayed refund
25% of consumers would call within the first 3 days to find out where their refund is
While the resource costs that merchants are incurring are bad enough, worse still is that slow refunds are also causing lost sales. And we don’t just mean goods that customers are returning. For instance:
73% of shoppers wait for their money to be refunded before making a new purchase
52% of consumers are willing to spend more if offered a faster refund
57% would purchase more often from the same merchant if they knew refunds would be faster.
This all shows the very tangible opportunity that faster or same-day refunds can offer for ecommerce merchants – helping to save on support resources and creating better customer lifetime value by delivering a better refund experience for shoppers.
Of course, same day refunds are not that straightforward to deliver for card payments – merchants would have to pull on their own funds to do this, which would stunt cash flow. Using a full-service PIS provider, like Trustly, can open up this opportunity. By using the Open Banking and real-time payment rails, coupled with an intra-bank model, funds can be moved almost instantly, either for the initial payment, or for a refund. This can create much greater consistency of customer experience across the full payment journey.
If you’d like to delve deeper into the revenue opportunities that instant refunds can offer, download the full report now!
To learn more about how Trustly can facilitate superior payments performance and experiences, get in touch with a member of our team.