Retail business models traditionally focus on sales as a key metric – a model which works well when customers can try products out in-store before deciding whether they want to buy them.
However, with the rise of e-commerce, this model needs to change. Up to one third of all orders placed online are returned. As a result, measuring business performance based purely on sales can be
highly misleading. In some cases, the cost of processing a return may completely wipe out any profit made on the sale. In others, the experience of purchasing a product that does not meet expectations can have a negative impact on loyalty – and therefore on customer lifetime value.
Clear Returns was founded to help retailers understand how and why returns happen, and what they can do to minimise them. By harnessing predictive analytics technologies from the IBM® Watson portfolio, the company is helping transform the way retailers look at the fundamental mechanics of their industry.