Leading brands are transforming post-purchase processes to drive loyalty and revenue amid rising costs.
COLUMBUS, Ohio–(BUSINESS WIRE)–Loop today announced the release of their 2025 State of Ecommerce Returns Report, which found that returns are no longer just a cost of doing business – they’re a critical source of revenue retention and strategic growth. Analyzing over 13 million returns across 4,000 Shopify merchants, the report reveals that return fees are now standard practice, exchanges are driving stronger loyalty, and merchants are finding new ways to protect margins in a high-cost environment.
70% of merchants now charge return fees, up from 65% last year. Rather than hurting customer loyalty, this move appears to be working – brands have so far retained $516 million in revenue in 2025 through returns optimization.
“Ecommerce brands face enormous challenges to maintain profitability in today’s economic climate,” said Hannah Bravo, CEO of Loop. “But Loop’s benchmark data shows that return fees are no longer taboo – they’re now the expectation as ecommerce matures. By investing in smarter sizing tools, optimizing product detail pages, and delivering personalized return experiences, we’re confident the most proactive brands will emerge from this period of high costs stronger than ever.”
Loop’s report also found that merchants are tailoring return fees to their vertical industry to cover shipping costs, with some raising them on bulky items, like home goods, while others in competitive categories like accessories prioritize a low-friction customer experience. Likewise, more brands are embracing solutions like Checkout+, which allow shoppers to opt in to return coverage at checkout. These opt-in models are gaining traction with consumers to offset costs and are increasingly seen as a path to cost recovery without friction.
“The best brands aren’t avoiding returns, they’re leveraging them to improve the P&L,” said Alexis Perlmutter, Head of Data at Loop. “Our State of Ecommerce Returns Report shows that when brands automate returns, incentivize exchanges, and think strategically about the entire customer experience, they retain more revenue and gain repeat customers. This is a clear moment of transformation in ecommerce operations, and it’s being led by brands that treat post-purchase like a growth engine.”
2025 State of Ecommerce Returns Findings – At a Glance
- Return fees are now standard: 70.2% of merchants charge them (↑ from 65% in 2024)
- Exchange rates rose, with jewelry (+30% YoY) and intimates (+26% YoY) leading the way
- Cosmetics & personal care brands had the fastest return processing and highest loyalty
- Return rates varied by vertical: electronics fell 28%, apparel increased 8%, home goods more than doubled (+144%), and intimates declined slightly (-1%)
Returns Have Become a Brand Differentiator
In a year marked by tariffs, economic uncertainty, and logistics volatility, ecommerce brands are tightening return policies not to punish customers – but to better serve them. The report spotlights how flexible return policies, regional customization, and automated workflows are helping merchants turn returns from a cost center into a retention advantage.
Download the Full 2025 State of Ecommerce Returns Report at: https://www.loopreturns.com/reports/benchmarks-2025/
About Loop
Loop is the industry’s leading commerce operations platform that empowers Shopify brands to streamline their entire customer journey, reduce friction, and maximize revenue. Its end-to-end approach integrates capabilities that help brands simplify their operations and delight customers, from initial orders to returns and exchanges. Offering features like Workflows, Instant Exchanges, Checkout+, and AI-powered tracking and visibility, Loop reduces costs, increases customer lifetime value, and retains revenue for more than 5,000 of the world’s most-loved Shopify brands. Loop has processed over 55 million returns and counting, and has helped merchants capture more than $2 billion in revenue over the past five years while delivering exceptional customer experiences. Learn more at www.loopreturns.com.
Contacts
Media Contact
Walker Sands for Loop
[email protected]
