Does Your Return Policy Provide an ROI?

Now, we here at Buzzshift have a decent amount of style, some of us know The Sartorialist, Fashionista, and Brog NOT Blog cold, and one of us even knows how to properly pronounce “Givenchy”. And while we have seen our fair share of quality or luxury as a differentiator, or customer service as a marketing tool (a la Zappos), we have rarely seen the combination of a luxury brand using customer service as an effective marketing tool. Many companies have a generous return policy, but few have a “no questions asked” policy, and fewer still have a proactive return policy that is worth raving about.

Enter Coach Bags. This purveyor of mass luxury handbags is best known for its high quality leather goods and distinctive “C” logo on its handbags and wallets. They also have a great customer service experience that is remarkable, in every sense of the word. About a year and a half back, I bought a nice little cloth and leather purse for my wife (brownie points), and she has used it with semi-regular frequency. Recently, however, we noticed that the cloth was starting to fray around the edges, slightly unusual for the amount of usage and level of quality. So, on a whim, we took it back to the store, thinking that we could get some advice on how she could avoid further damage to it, or get it repaired. Almost immediately, the sales associate said that “We have seen this before with this style of bag, and it happens when the bag regularly rubs against the wearer’s arm or against itself.”

At this point, it could have gone either way in terms of what they could offer, and probably could have said something to the effect of “too bad, so sad.” Instead, the store manager came over and said, “Feel free to look around and pick out a new bag worth $X (which was the original price of the bag), or we can give you store credit.”  As @eddiemart would say: Shut the front door! Really?

And in one instant, they turned a marginally satisfied, one-and-done customer into a happy, life-long brand advocate. My wife was THRILLED about shopping around for a new free bag. She couldn’t believe it. We had to go (thanks to our crying kiddo), but she went home, searched for the right bag on the Coach website, and came back the next day to finalize the return. In between, and afterwards, she told every friend to whom she talked, about her experience.

The math on this one: $X (cost of bag) = 1 happy customer + 20 referrals + a blogging/tweeting husband = $4X (conservatively).  I posted it on Twitter, and @Coach even pinged me back for good measure. @elysa said:

So, what’s the takeaway for your business, you ask?

1) Do you have some sort of “No Questions Asked” return policy for your product/service?

If your service is as good as you think it is, you should make it easy for customers to come back to you in case it didn’t work like it should. And you should have enough humility in place to say “I’m sorry. What can I do to make you a raving brand ambassador?”

2) If you do have that policy in place, are you making it really “remark”-able? Like, tell-10-friends-because-it’s-so-damn-cool remarkable?

How you present and execute the return policy is almost as important as the policy itself. Think about how you can make your customer’s day out of an otherwise negative situation.

3) Are you providing channels for your customers to share their “remarks” with others?

This is where we are seeing leading edge companies go crazy, and where you can help amplify their experience. Now that you’ve turned your customer around, help them share it, or monitor for their reactions on your social networks to enhance their experience even more.

We are curious, have you seen/experienced a “No Questions Asked” policy become a “return” on investment? We would love to know if their are other examples out there.

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