"Retailers Say They’re Drowning Under Post-Holiday Return Surge." 

The surge in online shopping and practices like “bracketing”— ordering multiple sizes or variations with the intent to return unwanted items — has significantly increased return volumes, posing logistical and financial challenges for retailers, according to Hannah Bravo, CEO at Loop Returns.

In fact, new data shows a 28% hike in returns over last year and consumers have already returned $122 billion in merchandise.

In an interview with PYMNTS, Bravo said to maintain customer satisfaction while controlling costs, businesses are turning to digital tools and strategic policies to manage returns more efficiently.

“Holiday returns hit new highs this year, especially in cosmetics and personal care,” Bravo said, “however, returns in the following days grew more slowly than last year, suggesting retailers’ efforts to reduce returns are working.”

In an effort to cut costs, she said, retailers are trying different approaches, including “longer return windows, return fees, and even letting customers keep low-value items rather than return them. They’re also using digital tools like virtual try-ons and AI [artificial intelligence] recommendations to help customers make better choices before buying,” she said. “Online platforms now make it easier for customers to exchange items or receive incentives to keep their purchases. These changes are helping retailers balance customer satisfaction with costs during this key shopping season.”
Leveraging Digital Tools to Streamline Returns

Bravo said the growth of online shopping and eCommerce platforms has impacted the volume and efficiency of post-holiday returns.

“The rise in online shopping and easy return policies has led to new shopping habits,” she said. “Many customers now routinely order multiple sizes or colors of the same item, planning to return what doesn’t work, a practice called bracketing. This trend is increasing return volumes significantly. For online retailers, handling returns is far more complex than shipping orders. Each return must be manually unpacked, checked and restocked, requiring extra staff and warehouse space. This costly process has pushed retailers to seek new technologies that can both reduce returns and keep customers satisfied.”

Digital tools are playing an important role in streamlining the post-holiday return process for both consumers and retailers, Bravo said.

“Digital tools like return portals play a pivotal role in ensuring customers and retailers experience hassle-free returns, especially given the mass volume of returns post-holiday season,” she said. “By integrating digital tools, retailers can offer a range of return options like designated drop-off locations, convenient shipping label alternatives like QR codes, and even scheduled pickup of returns at consumers’ addresses. These options ensure convenience for consumers but also benefit retailers by aligning with workflow and inventory management processes or by reducing processing costs, depending on the practice.”

The ease of returns is one of the reasons consumers choose to shop at specific retailers, according to a PYMNTS report, “The Online Features Driving Consumers to Shop With Brands, Retailers or Marketplaces,” which drew from survey data of 3,521 U.S. consumers.
Primary Reasons for Post-holiday Returns

The main reasons for post-holiday returns often stem from products not meeting expectations, such as wrong sizes, damaged items, delayed deliveries or discrepancies between online images and actual products, Bravo said. Retailers can leverage digital tools to address these concerns to enhance the shopping experience. Virtual try-ons, AI-powered sizing recommendations and detailed product images and descriptions help customers make more informed choices. Additionally, accurate delivery tracking and notifications can prevent late shipments, while offering real-time support and incentives for exchanges can reduce return volumes and improve customer satisfaction.

More Information at:
https://www.pymnts.com/news/retail/2025/retailers-turn-to-digital-tools-to-manage-post-holiday-return-surge/

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