CE Return Rates Have Remained Consistent, CEA Says

The rate of CE product returns has remained consistent over the past few years, according to CEA, based on a study conducted in conjunction with ShowUhow released Monday. The study of 2,036 randomly selected respondents in September found that more than a third of returned items are exchanged for the same model and brand, CEA said.

CEA released the report six days after USA Today ran a story on the high cost to the CE industry of product returns. That research, sourced from Accenture, said product returns cost U.S. CE retailers and manufacturers nearly $17 billion this year, an increase of 21 percent since 2007. According to that study, the $17 billion included costs associated with “receiving, assessing, repairing, reboxing, restocking and reselling returned products.” Return rates increased over the past 3-5 years for 57 percent of the retailers and 43 percent of the manufacturers surveyed by Accenture.

In CEA’s study, 27 percent of respondents said they returned a CE device in the past 2 years, and 18 percent reported having returned a product in the past 12 months. CEA’s 2009 study said 26 percent of consumers had returned a CE product in the prior 2 years and 16 percent had returned a product in the prior 12 months. Return rates “have a significant revenue impact on manufacturers, retailers and the entire industry,” said Chris Ely, CEA manager-industry relations. CEA is encouraging education -- either online before consumers get to stores or at the time of purchase -- to help customers learn more about the product in advance and reduce the need for return “especially around the holidays."

The top two reasons for product returns were that the device didn’t work as expected, and the products broke while in use, according to the CEA study. The least mentioned reasons for product returns were missing parts and difficulty setting up the device, CEA said. Prior to returning a product, consumers try various solutions to the problem, starting with checking user manuals and quick start guides (76 percent). Seeking friends, family and co-workers was the next course of action (65 percent), followed by manufacturers’ support lines at 62 percent, CEA said. Two-thirds of consumers exchanged the product for another product, it said, and 27 percent returned the product for store credit or reimbursement. Thirty-eight percent of respondents said they exchanged for the same brand and model, 13 percent chose the same brand but a different model, and 17 percent swapped brands, CEA said.