How Poor Data Reporting Loses You Money on BORIS

How Poor Data Reporting Loses You Money on BORIS

Let’s talk about BORIS. No, not your favorite Russian influencer, but a retail convenience that more and more brands are offering to their customers.

What is BORIS?

In today’s retail landscape, BORIS (Buy Online, Return in Store) has emerged as a key component of customer service strategies. Initially gaining traction during the pandemic, this option has become a staple for shoppers who value convenience and flexibility. In fact, this option is still on the rise with 47.6% of retailers reporting an increase in BORIS in the previous year.

BORIS allows consumers to purchase items online with the assurance that they can return them in person if needed. This hybrid model blends the ease of online shopping with the tangible reassurance of being able to walk into any brick-and-mortar store to receive customer service from a human. As online shopping continues to dominate, customers have grown to expect such adaptable return policies as standard, making BORIS an essential offering for retailers aiming to stay competitive.

How BORIS Can Lead to Profit Loss

However, while BORIS serves as an attractive feature for consumers, it presents a set of challenges for retailers, particularly in terms of returns management. The ease of returning items in-store encourages an increase in returns, which, without meticulous tracking and analysis, can become a costly affair for businesses. In fact, according to a recent report by the National Retail Federation (NRF), BORIS made up half (49.7%) of all returns from online sales, to the tune of over $123 billion.

And managing returns is costly (read our previous blog post on the Returns Problem). The NRF reported that “for every $1 billion in sales, the average retailer incurs $166 million in merchandise returns.” All those returned products need to be processed, categorized, perhaps refurbished and restocked, or liquidated. This costs time, effort, and can complicate logistics – all coming with their own manpower costs.

Furthermore, the BORIS model also opens avenues for fraudulent returns, where individuals exploit the system to return items purchased through illicit means or to return used items as new. The same report showed that retailers suffered over $100 billion in fraudulent and abusive returns, which was over 13% of total returns in 2023. Put another way, every $100 in returns led to retailers losing $10.40 to fraud. These practices not only result in financial losses but can also damage the retailer’s reputation if not managed properly.

Why BORIS is Still Beneficial

On the flip side, BORIS offers several benefits that, when leveraged correctly, can significantly enhance a retailer's operations and customer satisfaction. By reducing the need for shipping returned items back to warehouses, retailers can lower their shipping costs and streamline inventory management. This process is not only more cost-effective but also environmentally friendly, reducing the carbon footprint associated with logistics. Good for the planet, and good for the brand.

Moreover, BORIS facilitates a unique opportunity to recapture lost revenue because though the retailer is eating the return costs, the customers returning items in-store are more likely to make additional purchases during the same visit. BORIS leads to more foot traffic, and every retailer knows that just getting customers in the door is a win for the bottom line.

The convenience of BORIS also boosts customer loyalty, as shoppers appreciate the flexibility and efficiency of such services. WBR Insights found that “89% of consumers are less likely to shop at a retailer or brand if they had a bad experience with the return.” Conversely, 97% would be more likely to purchase again from a company they had a positive return experience with.

How Data Reporting Leads to Better BORIS

To harness the full potential of BORIS while mitigating its downsides, retailers must adopt best practices in data reporting and returns management. Detailed tracking of returns data is crucial for identifying patterns that may indicate fraudulent activity or highlight areas where the customer experience can be improved. Retailers should employ return analytics, like the type that 42 Technologies offers, to monitor BORIS transactions, understanding which products are returned most frequently and why. This insight allows businesses to address product quality issues, adjust inventory levels, and tailor their marketing strategies more effectively.

Additionally, integrating in-store returns with online data analytics provides a holistic view of customer behavior, enabling retailers to fine-tune their offerings and operations. Do BORIS returns correlate with more in-store sales? What returned items lead to another transaction when they come in to return them? Your data reports can show you where the opportunities are not just to mitigate returns, but to take advantage of them. The goal is to create a seamless omnichannel experience that delights customers while safeguarding the retailer’s bottom line.

So while BORIS presents a variety of challenges, particularly in the realm of returns management, its benefits cannot be overlooked. The convenience and flexibility it offers to customers make it an indispensable part of the modern retail experience. However, to truly capitalize on BORIS, retailers should invest in a data reporting platform like 42 Technologies. Better data helps retailers understand and optimize the returns process, which not only mitigates financial losses but also enhances customer satisfaction and loyalty.

Retailers who embrace the BORIS model, with a focus on efficiency and customer experience, will find themselves well-positioned in the competitive landscape. As the retail industry evolves, those who adapt and refine their BORIS strategies, backed by strong data reporting, will be the ones who thrive, turning potential losses into opportunities for growth and customer engagement.

Looking to turn your BORIS process into a revenue stream? 42 Technologies can help.