business news in context, analysis with attitude

by Kevin Coupe

Good piece from National Public Radio about how outdoor retailer REI has changed its return policy, moving from an unconditional anytime-anywhere-forever policy to a one-year limit on returns. NPR compares that to LL Bean, which continues to take back anything it makes...forever.

REI made the decision, according to the story, because management got tired of being taken advantage of: "Two years ago, REI noticed that the number of people returning really old stuff was increasing. Some customers talked about their returns on social media, which led to even more people bringing in their old junk to get refunds. It was hurting profits."

LL Bean, on the other hand, is relentless and cheerful about taking back products, believing that most customers are honorable and that, in the end, its policy is the best possible advertising it could have. (Full disclosure: LL Bean is my idea of a trendy designer. I've shopped at REI, but not nearly as much over the years.)

Steve Fuller, CMO at LL Bean, says "his company is sticking to its policy," NPR reports. "He says he's never been in a meeting where someone questioned the value of the guarantee. The only question he gets is whether the company talks about it enough.

"If anything, L.L. Bean seems to be welcoming the customers REI might be willing to let go. Behind its store counters, the guarantee is written in giant text. And there are a few reasons why this may be better business for L.L. Bean. Many of its sales are mail order, so it's less convenient for customers to return stuff. And, Fuller says, the crazy return stories are great marketing for the company."

It is an interesting comparison. It is hard to cast REI in a negative light - a one year return policy is hardly a small thing, and the company certainly has a right to protect itself.

Still, I have to say that I respect LL Bean's position, because it seems rooted into two things that I think retailers need to have - respect for the customer, and a sense that the bottom line is not always served by short-term decision-making.
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