Dive Brief:
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Flash-sales company Zulily Inc. is testing a returns policy with a select group of customers, the Wall Street Journal has learned.
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The program remains limited compared to other online retailers, accepting only certain apparel brands and home goods for store credit, minus shipping fees.
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The new policy is not official and is limited to a randomly selected group of customers and to certain items, the company said.
Dive Insight:
Zulily’s no-returns policy, and even this experimental limited returns policy, are among the most Draconian in retail. That may be an enviable thing — many retailers contend with return rates as high as 30% — but it may be hurting Zulily’s ability to retain customers and grow. The flash-sales site has seen sales slow drastically as it has moved beyond its core business of children’s clothes and toys and as the flash-sales model loses much of its luster.
Most likely, Zulily will find it should make this new policy official. And to truly compete it may also have to expand it to more items and possibly refund customer purchases rather than offer only store credit. That will require the company to become more nimble when it comes to its supply chain.
