Walmart on Monday raised the bar for service by an online retailer with its announcement of free home pickup of customer returns.
Called “Carrier Pickup by Fedex,” the program allows items bought at Walmart’s online store to be returned with a minimum of hassle by scheduling a home pickup from the store and printing a return label for the item.
If you can’t print a return label, you can create a QR code within the Walmart app. The code can be scanned at any FedEx office, which will handle the return for you.
Walmart also announced it’s making some changes to help expedite in-store returns. For example, it’s allowing the return process to be started online — no matter how the item was purchased — to speed up the process once the item is brought to a store.
It’s also addressing the lost receipt problem. If an item was bought in-store with a payment card, the transaction can be called up at any register.
The company added that refund times have also been improved. For many online returns, refunds will be credited to a customer’s payment account sometimes as soon as the next day, and for in-store returns, the same day.
“The holidays are stressful enough,” Walmart U.S. Vice President for Customer Strategy, Science and Journeys Linne Fulcher said in a statement. “No matter how customers buy items, we want the returns experience to be easy, safe and seamless.”
“We’re proud of the changes we’re making to take some of the stress — and those unwanted Christmas sweaters — off our customers’ backs,” she added.
Everything about returns is a challenge — for both consumers and for retailers — and returns for delivered products are even more challenging, noted Josh Lowitz, co-founder of Consumer Intelligence Research Partners, an equity securities research company in Chicago.
“Traditionally, in-person returns were handled slowly and often had an element of shame,” he told the E-Commerce Times. “In addition to repackaging, returns of delivered products required a trip to a post office or shipping service, or paying for a pick up.”
Variable return policies can also add to the hassle of returning items.
“Every store a consumer buys from has a different return policy — including where you can return a product, how long you have to return a product and the wait time to get your money back,” explained Brian Connolly, an e-commerce expert and writer for Jungle Scout, maker of a software suite for Amazon sellers, in Austin, Texas.
“2020 made it especially hard to return products in a safe manner,” he told the E-Commerce Times.
Hannah Frentzel, a brand portfolio manager for Upstartworks, a consulting and technology services company in Chicago, noted that one of the biggest benefits of online shopping is that consumers never have to leave their home.
“The hassle with returns is you do have to leave your home, usually, to make a return,” she told the E-Commerce Times. “A lot of people who intend to return products often don’t follow through. They might have the product sitting on the backseat of their car for months, hoping to get around to returning it but never doing it.”
“So having FedEx pick up returns at the home is revolutionary for shoppers,” she maintained.
“This service is a competitive step forward for Walmart.com,” added Lowtiz. “Being able to return Walmart.com purchases at any of the thousands of Walmart stores was already a consumer benefit. Free, from-home returns is a rare offering in online shopping, and it is interesting that Walmart.com is leading the way.”
Frentzel praised the timing of the new Walmart offering. “The holidays are the perfect time to launch services like this,” she said. “Retailers get a lot of new customers, so if they give them an amazing customer experience and easy return process, that’s going to solidify them as a repeat customer in the future.”
“We actually see retailers getting more stringent with returns around the holidays,” added Frentzel. “Windows for returns are shorter. Some items are restricted from being returned. This is good for Walmart. It sets them apart and makes them seem more generous during the holidays.”
While having FedEx doing home pickups of returns is a good idea, Sucharita Kodali, an analyst with Forrester Research, questioned the wisdom of using the logistics company for drop-off returns.
“I think it’s honestly a bit overboard,” she told the E-Commerce Times. “If you’re a store with nearly 5,000 locations, why you’re directing anyone to another location is baffling.”
“From my experience,” she said, “Walmart could staff their returns and customer service desk a bit more generously so people don’t have to wait in line. If they solved that problem, that would probably solve the biggest pain point with a Walmart in-store return for an online order.”
“In fact,” Kodali continued, “if I were Walmart, I would try to offer services for other retailers to continue to drive people into stores, but maybe Walmart doesn’t need to keep doing that, as they get enough foot traffic or need to keep crowds from getting out of control.”
Competing with Amazon
Home pickup of returns benefits consumers, but it may have business benefits to both Walmart and FedEx. “The service may also serve Walmart’s logistics needs to efficiently process returned merchandise and may be partially motivated by FedEx’s desire to be an irreplaceable partner for Walmart,” Lowitz observed.
Walmart is making many changes to compete with Amazon, added Connolly. “Returning items was one place where Amazon was winning heavily,” he said.
“I think this is just another attempt from Walmart to close the gap between itself and Amazon,” he asserted. “Amazon already has many different ways customers can return items and Amazon does its best to make returning as easy as possible. Walmart only had traditional returns until today’s announcement.
“With the introduction of Walmart+ and more sellers looking to adopt Walmart as a way to fulfill products,” he continued, “it’s important that Walmart be able to offer competitive perks — such as easy returns for consumers — to make sellers happy.”
As retail giants roll out more free services and reduce friction at every point in the shopping process, smaller retailers are beginning to feel the pinch.
“It’s getting tougher and tougher every day if you’re not an Amazon or Walmart,” Frentzel said. “It’s almost an expectation now that anywhere you shop people expect free shipping, free returns and exchanges and two-day shipping. It’s easy for Amazon and Walmart to do that, but it’s just not profitable for other retailers.”
Connolly agreed that competition is difficult for smaller retailers. “But those smaller retailers are learning ways to adapt by changing what they offer or how they offer it,” he added. “Not everyone wants to shop on Walmart or Amazon all the time, even if it is convenient.”