Fashion e-commerce faces average return rates of around 50%, as customers embrace the convenience of trying on clothes at home. However, the introduction of advanced size and fit technologies promises both to enhance customer satisfaction and significantly reduce return rates.
Cutting returns with advanced Size & Fit technology
The online fashion retail industry has seen unprecedented growth, with customers enjoying the convenience of shopping from the comfort of their homes. However, this convenience comes with a challenge: high return rates. Across Europe, on average nearly 50% of fashion items purchased online are returned. This statistic underscores the need for a robust reverse logistics network and the strategic use of data-driven assortment steering to manage and reduce returns effectively.
The use of modern technology offers promising solutions to these challenges. By leveraging innovative tools such as virtual fitting rooms and body measurement-based recommendations, retailers can enhance the shopping experience and significantly reduce return rates. These technologies not only improve customer satisfaction by ensuring better size and fit accuracy but also support sustainable practices by further reducing the environmental impact of returns.
For more insights and detailed strategies, watch our episode of "Business Casual" with Stacia Carr, VP Fashion Customer Experience at Zalando.
The current status of return rates across Europe
Our data indicates that about ⅓ of all returns are due to size and fit issues. The products with the highest return rates include dresses, trousers and shoes. We see for instance that jeans are frequently returned due to the difficulty customers face in finding a well-fitting pair online. The lack of standardisation in sizing across brands amplifies this issue.
On the other hand, items like hoodies, sweatpants and T-shirts tend to have lower return rates. These items are generally more forgiving in terms of fit, making them easier for customers to purchase without the need for returns.
Of course, these statistics differ depending on the market and even the sales channel mix. Additionally, each European country has its unique return preferences.
Local return preferences in Europe
Understanding the return expectations of shoppers across Europe is crucial for optimising logistics and enhancing customer satisfaction. While each country has its unique preferences, there are some common trends:
In the Baltics, parcel lockers are the preferred return method, with 85% of Estonians, 79% of Latvians and 75% of Lithuanians choosing this option. Similarly, in Poland, 80% of consumers favour parcel lockers for their returns.
The Scandinavian market shows a more varied preference. Finnish consumers favour parcel lockers (65%), while Danish shoppers prefer drop-off points. Swedish and Norwegian consumers are almost evenly split, with 56% and 64%, respectively, favouring drop-off points.
In Germany, 64% of consumers prefer using drop-off points for returns. Similarly, in the Netherlands, 67% of consumers choose drop-off points as their preferred method.
Globally, more than half of the consumers prefer drop-off points for returning their items.
These regional differences highlight the need for a flexible and adaptable return logistics network, impacting logistics planning and execution. Retailers must ensure they offer a range of return options to cater to different customer needs. This not only improves the return experience for customers but also streamlines the logistics process, thus reducing the time and cost associated with managing returns and getting them back online for resale.
Zalando's innovations in Size & Fit
As a leader in fashion e-commerce, Zalando is pioneering technological solutions to tackle the challenges of how to manage returns in e-commerce. By leveraging innovative tools like virtual fitting rooms and body measurement-based recommendations, Zalando aims to reduce return rates and enhance customer satisfaction. These cutting-edge technologies not only improve the shopping experience but also support more sustainable business practices, by, for example, reducing the environmental impact of transporting these returns.
Virtual fitting rooms set up new standards
Zalando is at the forefront of using technology to address size and fit issues, launching a virtual fitting room pilot programme across multiple markets. This innovative solution allows customers to create a 3D avatar by entering their height, weight and gender, helping them visualise how different sizes will fit. The virtual fitting room focuses on one of the most challenging categories for online shoppers: jeans. Customers can see a heatmap indicating where the jeans would be tight or loose on their avatar, providing a clearer understanding of fit before making a purchase.
Initial results from the pilot are promising, with increased customer engagement and return rates reduced by 20%. Around half of the customers try more than one size on their avatar, indicating a high level of interest and interaction with the technology. Zalando plans to expand this technology, making it a seamless, scalable solution. By leveraging 3D digital design software and workflows, the company aims to support the fashion industry in adopting similar technologies, ultimately benefiting customers and brands alike.
Body measurement-based recommendations as a personalised approach
In addition to virtual fitting rooms, Zalando has introduced body measurement-based recommendations. This feature allows customers to take two pictures of themselves in tight clothing, enabling the technology to accurately predict their body measurements. Currently available in the DACH region for women’s tops and dresses, this feature helps customers find the perfect fit for one of the most challenging categories. By using these unique measurements, customers can enjoy a more personalised shopping experience.
Zalando plans to expand this feature to more categories and markets, further enhancing its size and fit solutions. The aim is to offer this innovative technology to a broader audience, helping even more customers find the right fit.
Smart industry innovations that help reduce return rates
But Zalando isn’t the only platform that is adopting advanced technologies to enhance the shopping experience and reduce return rates. Here are some notable innovations from leading companies.
ASOS Fit Assistant
ASOS has developed the Fit Assistant tool to help customers find the perfect size for their purchases. This tool, which uses machine learning algorithms, provides personalised sizing recommendations based on customer input regarding height, weight and fit preferences. Available on both the ASOS website and app, Fit Assistant enhances the shopping experience by reducing the likelihood of returns due to sizing issues.
Bershka and 3DLOOK partnership
Bershka has implemented 3DLOOK’s virtual fitting room technology to provide a seamless online shopping experience. Customers can take front and side photos, which are then used to create precise 3D body maps. This technology offers size recommendations and a photorealistic virtual try-on experience, significantly reducing size-related returns.
H&M’s Smart Mirrors
H&M has introduced smart mirror-equipped fitting rooms in its COS stores. These mirrors offer virtual try-on capabilities, personalisation options and styling suggestions. Shoppers can also request additional items directly from the fitting room. This innovation aims to create a more interactive and convenient shopping experience.
Amazon’s Blended-Reality Mirror
Amazon has developed a blended-reality mirror that uses augmented reality and LCD screens to show customers how various clothing items will look on them. This innovative mirror combines physical and digital elements to create a realistic try-on experience.
Evolve along with the latest developments
Reducing return rates in fashion e-commerce goes beyond just saving costs; it’s about creating a more sustainable shopping experience. Innovations like virtual fitting rooms, body measurement tools, and smart mirrors are changing how we shop online, making it easier to find the right fit and reducing the need for returns. These technologies are setting new standards for customer satisfaction by offering more personalised and accurate shopping experiences.
