cnbc.com
Record Consumer Returns to Cost $890 Billion in 2024
In 2024, US consumer returns are projected to reach $890 billion (17% of sales), up from $743 billion (15%) in 2023, due to increased online shopping and practices like bracketing and wardrobing, creating significant financial and environmental challenges for retailers.
- What are the key economic and environmental consequences of the surge in consumer returns expected in 2024?
- US consumer spending is on track for record highs this year, but a significant portion will be returned, totaling an estimated $890 billion in 2024—a 17% return rate, up from 15% in 2023. This surge in returns is driven by increased online shopping and practices like bracketing and wardrobing.
- How are changing consumer behaviors, such as bracketing and wardrobing, contributing to the rise in returned goods?
- The rising costs associated with processing returns (30% of an item's original price) and the environmental impact of waste from returned goods pose significant challenges for retailers. These challenges are amplified by practices like bracketing (buying multiple sizes/colors and returning unwanted items) and wardrobing (buying items for a specific event and then returning them).
- What innovative strategies are retailers employing to mitigate the financial and environmental impact of returns, and how effective are these strategies likely to be in the long term?
- Retailers are responding to these challenges by implementing stricter return policies (81% did so in 2023), offering "keep it" refunds, and exploring buyback programs and reselling returned items through secondhand channels. However, consumer behavior, especially regarding free returns, remains a crucial factor influencing purchasing decisions.
Cognitive Concepts
Framing Bias
The article frames the issue primarily from the perspective of retailers, emphasizing the financial and environmental burdens of returns. While consumer behavior is discussed, it's largely presented as a problem that retailers need to solve. The headline and introduction highlight the financial scale of returns, setting a tone of concern about the economic and environmental consequences. The emphasis on negative aspects, like waste and costs, might unintentionally overshadow the benefits of generous return policies for consumers and businesses.
Language Bias
The article uses relatively neutral language, but the repeated emphasis on negative economic and environmental consequences ('hefty price', 'strain on traditional systems', 'major challenge', 'landfill waste') subtly shapes the reader's perception. While these are factual points, the repetitive negative framing might influence readers to view returns more negatively than a more balanced approach would allow. For instance, the phrase "$890 billion in returned goods" could be rephrased as "$890 billion in merchandise returned", thereby lessening the negative implication.
Bias by Omission
The article focuses heavily on the financial and environmental impact of returns, but omits discussion of the consumer perspective beyond their return behaviors. While it mentions that return policies influence shopping decisions, it lacks in-depth exploration of why consumers return items beyond convenience factors like bracketing and wardrobing. The social and psychological aspects of consumer return behavior are largely absent. Further, the article doesn't explore potential solutions from a consumer behavior standpoint, such as improved product descriptions or pre-purchase visual aids. This omission limits the article's comprehensiveness.
False Dichotomy
The article doesn't present a false dichotomy in the traditional sense of an oversimplified eitheor choice. However, the framing implicitly suggests a dichotomy between retailers' need to manage returns and the consumer's right to return items, potentially overlooking the possibility of solutions that benefit both parties.
Gender Bias
The article features several quotes from CEOs, all of whom are men except for Amena Ali of Optoro. While this isn't inherently biased, it reflects an imbalance in gender representation in leadership positions within the retail and logistics sectors. The article itself doesn't exhibit gender bias in language or descriptions. More diverse sourcing would improve representation.
Sustainable Development Goals
The article highlights the significant environmental impact of merchandise returns, including increased carbon emissions from transportation and repackaging, landfill waste, and low recycling rates. This directly contradicts the principles of responsible consumption and production promoted by SDG 12, which aims for sustainable consumption and production patterns.