Are ‘Just Keep It’ Return Policies Loyalty Builders?

A new study finds while the primary reason for “just keep it” return policies may be to help retailers save money by avoiding the costs involved in shipping and processing returns, they also pack a sizeable goodwill benefit.

The study from researchers at Notre Dame found “returnless returns,” or when a consumer is told to keep an item they’re seeking to return and still get a refund, can make affected consumers more likely to write positive reviews, recommend the brand, and repurchase an item.

However, the researchers found the goodwill benefit varies based on the circumstances.

Case-by-Case Returnless Returns May Be Better Than a Blanket Policy

While some brands, including Chewy and Bombas, offer a blanket returnless policies for all customers and situations, a bigger goodwill benefit is earned by those employing it on case-by-case basis, like Amazon and Walmart, because a human connection is involved and it’s a surprise.

“The consumer feels they are getting special treatment,” said John Costello — an associate professor of marketing at the University of Notre Dame, and one of the paper’s co-authors — in a statement. “Also, because they are getting human interaction rather than an automatic e-mail, the customer feels additional warmth toward the brand. So, increasing the level of ‘humanness’ in digital interactions has proven beneficial.”

How the “just keep it” benefit is explained to the customer can also elevate goodwill, especially if it leans on a “consumer or environmentally centric motive” in the response.

Among the findings:

• One experiment showed consumers seeking to return a phone charger in a returnless exchange situation were more likely to recommend a brand if they weren’t required to show proof of the problem with a product, such as showing a video or photo of the damage, to earn their refund.
• One experiment involving a shirt return in a returnless return situation found those who were told to donate the shirt to someone in need viewed the brand more favorably than participants told to dispose of it.
• One experiment involving the return of fruit found participants most likely to recommend the brand if were those told the returnless return was being made to make their lives easier in avoiding the hassle of packing up and shipping the items back. Those who were told the retailer was trying to reduced carbon emissions were the next most positive about the brand, while those told the company was seeking to reduce cut costs received the least positive comments.

“We find that brands can really benefit from returnless returns if they act more communal than transactional,” Costello told the Wall Street Journal.

A 2023 survey from returns technology provider Narvar found that 75% of customers have been offered a “keep the item” return at least once in their shopping lifetime, with Amazon, Walmart, Target, Wayfair, Chewy, Kohl’s, and Shein cited among those employing the practice.

Of the respondents, 90% who received the perk had previously shopped with that retailer and appreciated the trust expressed through the policy, while 65% appreciated that retailers are saving their time and effort by letting them keep the return.

On the flip side, 53% expressed concerns that unethical customers will abuse the “keep it” policy and drive up prices for everyone, while only 50% liked that retailers were saving costs and reducing their environmental impact through the policy.