Online retailer: If the shoe fits, please keep it
German-based online retailer Zalando is dealing with a huge number of returned goods, with four out of five shoe sales being sent back – and 65 percent of women’s jeans rejected – putting stress on the company’s bottom line.
Although retail experts have long argued that you can't sell shoes online, Zalando was determined to show them wrong with slogans that told customers to send back whatever failed to make them cry out loud with happiness.
But it seems customers are taking Zalando for its word and most of the shoes ordered end up back at the warehouse, industry insiders told the Süddeutsche Zeitung newspaper. So despite strong sales, the company has yet to make any money, the paper said on Wednesday.
The company refused to say how it has been affected by returns, which retail sources say is common, but an industry insider said Zalando had "completely underestimated" the return factor, though it has made efforts, by changing its advertising, to get things under control.
Returns are a big problem for the online retail industry, the paper said. They cost time and money.
Yet to date no one has complained about the "buy, try and return" mentality of many Germans, according to the German E-Commerce and Distance Selling Trade Association (BVH).
While it will never be possible to weed out mean-minded shoppers who buy loads of stuff to try on, knowing they will return most of it, or others who buy a fancy dress for a special occasion, wear it and then return it as "unworn", retail experts say such customers are only a minority.
The paper noted that the French are much more cautious about returns because they have to pay for their online purchases upfront. Only around 10 percent of goods are returned in France, retail expert Thilo Bobrowski of the consulting firm SMP told the paper.
In Germany people only pay after they have received the goods and the invoice.
In the meantime, the old slogan: if the shoe fits, wear it, is not what Zalando wants. A better motto for the online retailer would be: if the shoe fits, please keep it.