eBay is pushing sellers to offer 30-day free returns, and its Vice President of Seller & Marketplace Operations Bob Kupbens made the case during a recent video presentation. He outlined a few steps eBay was taking to protect sellers who offered generous return policies – protections that may have gotten lost in the shuffle with all of the news coming out of this year’s spring and summer seller updates.
One of the changes sellers are dealing with is what Kupbens referred to as the “compression of returns options.” As eBay explains on its website, sellers may now only choose from among the following policies:
– No returns accepted
– 30-day buyer-paid returns
– 30-day free returns
– 60-day buyer-paid returns
– 60-day free returns
The following categories continue to have the option of 14-day returns: Collectibles & Art, Cameras & Photo and Medical, Mobility & Disability Equipment. Starting in August 2018, eBay will update any listings that sellers have not yet updated to one of the new returns policy options, including Good ‘Til Cancelled listings.
eBay will also introduce automation in the returns process: “Starting July 2018, we will automate two steps in the returns process for buyers and sellers,…You can continue to control the efficiency of your returns process by creating rules in your Return Preferences to automatically approve returns or send immediate refunds without requiring the buyer to send the item back.”
While eBay wants sellers to offer more generous returns policies, it’s also making returns more costly – sellers can no longer charge restocking fees, and if they see an uptick in certain types of returns (SNADs), they could be charged a penalty fee equal to 4% of the selling price of their items (we discussed the new fee in last month’s editorial, and you can learn more on this eBay page).
eBay explained, “Starting in September 2018, if you have very high occurrences of these poor buyer experiences, you will be notified via email and may be subject to extended estimated delivery times and additional fees.”
eBay will measure sellers’ performance with new service metrics and peer benchmarks, which “will give you new competitive insights and greater visibility into after-sale requests that aren’t meeting buyers’ expectations.”
The metrics will show you:
– How often you receive return requests for “items not as described.”
– How often you receive buyer requests for “items not received.”
– Peer benchmarks—comparisons to sellers of similar items.
– Insights into why buyers are making after-sale requests, and tips to reduce requests.
While eBay says the policy is fair since it compares sellers of similar items, a reader had this to say about it:
“What is being overlooked is how the comparison is being made. The comparison is very broadly based in the primary categories, not sub categories. So for example if I sell Used Cell Phones I am being compared to other Consumer Electronics Sellers who might be selling a new calculator or a new cable end.”
Fewer Return-Policy Options on eBay
In explaining the reasoning behind the policy “compression,” Kupbens said eBay return policies were confusing to buyers because there were so many variations (there were 73 different returns options) and sometimes there would be conflicting policies in the same listing.
eBay wanted a standardized set of returns options, with an exception for certain categories.
“If you’re a retailer like eBay, and you want to go out to the market and go, “hey, we have free returns,” you can’t, unless you get some critical mass.”
Free 30 days is important – as you look at the retail landscape, he said, free 30-days is starting to be the basic expectation of buyers from all retailers.
Kupbens then addressed some changes eBay is making to try and protect sellers from abusive buyers.
There are things we’re worried about with our seller population if they offer free and 30-day returns:
– One is that they’re going to get something returned that doesn’t have the same value as the thing they sent out – that happens a lot.
– The other is that people would game returns – we really haven’t seen that – the data doesn’t show that we’ve got a dramatic increase in returns. But we’ve done a few things.
– One is, if you offer 30-day free returns, we protect you by allowing you to offer a partial refund – up to 50%, if you get something back in a degraded condition. (That’s not “appealable” by the buyer; they can’t come back and force you to issue more of a refund (they have to take it up with eBay.)
– The other way we’re going to protect you is that we’ll remove any negative or neutral feedback if you offer 30-day free returns associated with those transactions.
– The third thing is behind the scenes we’re using machine learning and all of our technology to evaluate and look at buyers who have a “bad return behavior.” We’ll introduce friction into the process for those buyers when they transact with sellers offering free 30-day shipping.
Kupbens suggested sellers try offering 30-day free returns and do the math – he suggested sellers use eBay’s newly launched returns calculator.
The premise of the returns calculator: raise your prices to compensate for the cost of higher returns.
Available on this page, it asks sellers to enter the number of transactions and number of returns they’ve had in the past 90 days, and then enter the “total cost of return shipping.” Sellers then select which policy they currently have, and which policy they will update to.
The calculator then provides sellers with the “Amount to add to item with free returns.”
Kupbens said, “Use some of your historical results and put them through that calculator. We believe there’s a very significant conversion increase associated with offering 30-day free returns.”
He wrapped up by stating, “We know there are some issues, we’ve tried to create seller protections in the form of partial refunds, some of the buyer abuse – checking them, as well as removal of negative and neutral feedback. We believe this is the future, we’re trying make sure that we give you the tools to get there with us.”
eBay introduced “Return Rate” metric in the Seller Dashboard in 2016, but at the time said it was only there to provide information helpful to sellers in managing their businesses.
Visit the Simplified Returns page in the Summer Seller Update section of the eBay website for more information.