Retail returns to hit $849.9bn in 2025

Core Insights - Retail returns account for 15.8% of annual sales this year, consistent with 16.9% last year, with total returns amounting to $890 billion in the previous year [1] Group 1: Consumer Behavior and Expectations - Returns are evolving from a transaction endpoint to an opportunity for retailers to enhance customer experience and foster brand loyalty [2] - Consumer expectations regarding returns are rising, with 82% of shoppers considering free returns as a major factor in their purchasing decisions, an increase from 76% last year [4] - A significant portion of consumers (76%) prefer return options that offer instant refunds or exchanges [4] - Poor returns experiences can negatively impact future purchases, with 71% of consumers less likely to shop with a retailer again after a bad experience, up from 67% in 2024 [5] Group 2: Generational Impact - Gen Z consumers (ages 18-30) are making an average of 7.7 returns of online purchases in the last year, more than any other generation [3] Group 3: Retailer Priorities and Challenges - Retailers' top priorities for 2026 include increasing online sales and reducing return rates, with 64% of merchants planning to update their returns process in the next six months [6] - The main reasons for charging for returns include rising operational costs (40%), increased carrier shipping costs (40%), and economic uncertainties (33%) [6] Group 4: Return Fraud and Costly Behaviors - Return fraud remains a significant issue, with 9% of all returns identified as fraudulent [7] - Many consumers engage in costly return behaviors, with nearly two-thirds admitting to practices like "wardrobing" and "bracketing" [7] - Approximately 45% of consumers believe that "bending the truth" during returns is acceptable, particularly if they are dissatisfied with their purchase [7]