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As previously predicted by analysts, 2021 did see a surge in holiday sales despite supply chain challenges and COVID-19 concerns. A recent report from Mastercard’s Spending Pulse revealed that holiday retail sales increased by 8.5% over the last year. “Shoppers were eager to secure their gifts ahead of the retail rush, with conversations surrounding supply chain and labor supply issues sending consumers online and to stores in droves,” said Steve Sadove, Senior Adviser for Mastercard.
The peak season may have come to a close but consumer spending is far from over. According to RetailMeNot, 51% of customers planned to shop post-Christmas, with 38% of them looking to return their gifts. In the wake of the Coronavirus outbreak, in-store fitting rooms and makeup testers have become close to obsolete. Today, shoppers must try on or test out their different purchases at home before returning whatever they do not fancy. In line with this trend, many brands and retailers, including Amazon and Macy’s, have actually enhanced their holiday return policies.
Apart from RetailMeNot, CBRE and Optoro also expected a high volume of e-commerce holiday returns this season. Their report even forecasted the total return value to reach $66.7 billion in merchandise this year, up 45.6% from the past five-year average. While generous return arrangements can bring great convenience to consumers, they can also harm a retailer’s financials and the environment.