Morning Brew - ☕ Return of events

Offsetting the cost of returns.
October 29, 2024

Retail Brew

It’s Tuesday, and it’s been a roller-coaster week for meat sandwiches. Subway is facing a lawsuit alleging that its sandwiches are short on meat, while McDonald’s is putting its quarter-pounders back in buns after determining they were not the cause of a deadly E.coli outbreak, but rather sliced onions from a specific provider.

In today’s edition:

—Andrew Adam Newman, Vidhi Choudhary

DTC

Ready, Offset, go

A stack of clothing with a slip of paper that says "Returns." Francis Scialabba

Free returns may have once been table stakes for e-commerce, but the tables have turned. Among brands that now charge fees for at least some return methods are Amazon, Zara, Abercrombie & Fitch, J.Crew, and H&M.

A 2023 study by Happy Returns found that 81% of retailers had started charging for at least one type of return in the previous 12 months. The value of returned merchandise in the US totalled $743 billion in 2023, according to the National Retail Federation.

Now returns and reverse logistics platform Loop is introducing a feature to offset the cost of returns called, fittingly enough, Offset. At checkout, online shoppers can opt for a relatively small fee—Loop suggests $1.98—in order to not be charged steeper fees later.

Among the more than 4,000 brands that use its software, nearly 70% now charge for returns, with an average return fee of $8.50, according to Loop.

Offset “is a way for a customer to be like, ‘Okay, now I know I won’t get hit with a hidden fee that I’m not aware of right now at the time of purchase,’” Loop CEO Hannah Bravo told Retail Brew. “‘I’m going to pay $1.98 right now, and I never have to think about it again.’”

Keep reading here.—AAN

   

From The Crew

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The Crew

E-COMMERCE

Going live

TikTok Shop livestream TikTok

When it comes to Black Friday and Cyber Monday, TikTok is relying on livestreams to generate revenue.

This holiday season, TikTok Shop will host “super livestreams” featuring celebrities (though it declined to share names).

Livestreaming was a dominant theme of TikTok’s first US commerce summit hosted in California last month. TikTok Shop seems determined to make live shopping work in the US, and is encouraging both brands and creators to go live as much as possible for two-hour sessions on average.

Keep reading here.—VC

   

MARKETING

Shrinkfiction

Tostitos display in a supermarket. Jeff Greenberg/Getty Images

Shrinkflation, when brands reduce the size of products, often imperceptibly, and charge the same or more, has drawn backlash, so when a company appears to reverse shrinkflation, it’s big news.

“PepsiCo is unshrinking shrinkflation,” began an October 16 article on CNN.com about the company’s plan to introduce bonus packs with 20% more product for some bags of Tostitos and Ruffles.

But does a bonus pack signify, as a headline in Benzinga the same day put it, that “Pepsi fights back” against shrinkflation?

No, contends consumer advocate Edgar Dworsky.

Keep reading here.—AAN

   

SWAPPING SKUS

Today’s top retail reads.

In with the new: Estée Lauder has tapped Stéphane de La Faverie as CEO, and Jane Lauder, the granddaughter of the company’s founder, will leave her executive role. (the Wall Street Journal)

Listen up: Following a new software update, some of Apple’s AirPods wireless headphones can now be used as hearing aids. (the Associated Press)

Packing it up: The last meat operator in New York City’s famous Meatpacking District is packing it up as a new mixed-use development is set to take its place. (Bloomberg)

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