Case Study: Deckers
Do you own any Ugg® boots? Sanuk® slippers? How about Teva® flip flops? If the answer to any of these is yes, then you’re wearing a Deckers Brands shoe. Deckers is one of the world’s leaders in footwear, owning (among these three) some of the most recognizable brand names for shoes and related apparel and accessories.
And, as one of the premier global names in footwear, Deckers is also well acquainted with the trials and tribulations of the returns process. When customers want to try a new shoe, they’ll order online from Deckers, wear it at home to see how well it fits and, if it doesn’t, return it. Returns is an everyday part of Deckers’ business, but that process hasn’t always been smooth sailing, for either customers or Deckers.“
Over the years, we’ve seen friction in our returns experience and have invested a lot into expediting this process,” said Jesse Carstens, senior manager of ecommerce technology and operations at Deckers Brands.
The source of that friction
Deckers is not shy about the evolution of their returns process. In the early days, in order to file a return, customers first had to print out a PDF form, fill it out, then mail it to back to the company, all while paying for shipping themselves. That was problematic in a number of ways, from the added hoops for customers to jump through, to the added cost they would need to pay.
But, more than that, the PDFs themselves were not reliable or transparent ways of processing returns. Oftentimes, the PDFs would be returned incomplete, forcing Deckers employees to spend time and effort on filling out the rest of the form in order to ensure proper handling.
Additionally, the nature of the process meant that Deckers’ insight into the customers making the returns was extremely limited. There was no information to be gleaned that could be leveraged for better customer communications in the future, and no tracking visibility that would allow them to prepare inventory for the product return in advance. If a customer printed out a PDF form but sat on it for weeks before filling out and returning it, the company had no way of knowing of how many products the customer was shipping back or when they would arrive.
Carstens attributed these points of friction to a general “lack of focus on returns ten years ago.”
Customer expectations around returns and refunds have grown significantly over just the last few years.
“There used to be a 10 to 14-day lead time in that process,” said Carstens. “Not only do customers want a faster, easier, free experience now, they also want a fast refund. Years ago, this wasn’t an issue.”
And, in Carstens’ view, Deckers had lots of opportunity on how the returns process should be handled to best serve customers expectations. Not only was the experience neither free nor easy, but it wasn’t especially fast either. Deckers’ distribution and returns centers are based on the West Coast; that meant that for the large share of Deckers customers who live on the East Coast, processing returns and exchanges could take between five and eight days. That, in turn, led to an increase in call center volumes, stemming from longer wait times and increased friction on the customer’s end – not to mention the added time and effort needed of employees to take these calls and manage the customer experience as best they could.
Making a change with Pitney Bowes
Since confronting these challenges, Deckers Brands has made a number of investments in improving and accelerating the returns process. Chief among them was working with Pitney Bowes.
“We made the decision to make returns easier and free for customers. We did a lot to remove that friction for customers on the website, using A/B testing and experimenting to get customers through the site as easily as possible,” added Carstens. “Secondly, we partnered with Pitney Bowes.”
The Pitney Bowes SmartLabel incorporates all customer order and shipping information within its barcode, eliminating both the need for customers to fill out forms and the risk that forms would be returned with incomplete or illegible information. This same barcode also provides both Deckers and their customers with transparent tracking information, so that both sides can follow the return’s trip every step of the way. This ensures that customers always know where their return is while in transit, call centers have quick and accurate information to draw on if asked by a customer about their order, and Deckers can better plan staffing and inventory needs around receipt of returns.
Better staffing means less idle time in the warehouse, which leads to lower labor costs. Additionally, improved visibility leads to happier shoppers. Customers used to wait up to nine days to receive a credit or exchange from their return, but now the average wait time is around one day, said Carstens.“
"Our previous returns process put too much responsibility on the customer, which was at odds with the hassle-free shopping experience we strive to deliver to our customers,” said Carstens. “Now, with Pitney Bowes SmartLabel technology, customers have visibility into their entire returns process and we’re able to offer them the highest level of service as they deserve. As a result, we have seen a significant decrease in returns related contacts over the last three years.”
Bridging the East Coast/West Coast divide
Not only did Pitney Bowes’ SmartLabel streamline the returns experience for both Deckers and their customers, they provided another source of support for the company’s geography problem.
“We’ve solved that,” noted Carstens. “Pitney Bowes allowed us to achieve a more blended [returns processing] rate of three-days-for-anywhere in the U.S,” thanks to an East Coast-based Pitney Bowes facility that handles all Deckers returns on that side of the country. There, Pitney Bowes employees – mirroring the standard set in Deckers’ West Coast facilities – can process product returns and issue refunds to East Coast customers before the product has even completed its return to Deckers’ distribution centers in the west.
Deckers’ partnership with Pitney Bowes has helped to create a more streamlined, modernized returns process that lives fully in line with what today’s customers want out of their favorite brands: free shipping, fast refunds and a hassle-free returns experience.