SIRAS logs and verifies the attempted
return (successful or not) of a specific
product against a record of its original
purchase. Each product is identifiable by
a unique “fingerprint” generated by Siras
and based on its UPC and serial number,
the company said.
According toSIRAS president Peter Junger, an aging analysis on returns and attempted returns can help retailers identify patterns of fraud. For example, while a high rate of attempted returns on the date of purchase might be attributed to buyer’s remorse, it could also be a sign of something amiss, like credit card fraud, product substitution or some other form of theft.
The analysis might also be used by a retailer to consider the impact of modifying or customizing return policies to trim losses, Junger said.
There are a few qualifications about SIRAS’ data to keep in mind. First, the data is compiled based only on the products and retailers participating in its programs. So while the sample is quite large with dozens of UPCs, thousands of retail locations and tens of millions of transactions over a 12-month period, it will not include products that are typically not involved in a SIRAS program, such as items priced below $25, the company said.
More detailed reporting is available to SIRAS’ participating retailers and manufacturer clients, said Junger.
Siras’ analysis is based solely on those products with serial numbers registered in its program, and it uses only transaction information from participating retailers, so the analysis is highly reliable, especially since it is untainted by non-registered products or products sold through secondary or other unauthorized channels. Also worth noting, the data covers attempted returns, not simply successful returns.
Not all return attempts comply with retailer and manufacturer policies, and are deflected using the SIRAS Electronic Registration program.
This initial report (see chart) shows returns for flat-panel LCD and plasma TVs based on data compiled over a 12- month period ending in this March.
Two points are worth considering, SIRAS said. The first and most obvious is that nearly 14 percent of returns are attempted on the very date of purchase. This rate, when compared with other categories or a retailer’s expectations, could indicate a sign of trouble or opportunity worth looking into.
Also, 81 percent of attempted returns take place within 30 days of the original purchase and 95 percent within 90 days. A retailer with a 90-day return policy might look to reduce returns by requiring they be made within 30 days of original purchase.
Such a change in policy might not have a negative impact on the consumer experience, but it could have a significant impact on the bottom line. The key for retailers is having these facts in front them in order to better define their policies and identify opportunities, SIRAS said.