Online retailers spend a lot of time and money to turn customers into repeat buyers. But often, it’s how well the merchant handles returns of online orders that can be the deciding factor in keeping a loyal customer.

Online retailers spend a lot of time and money to turn customers into repeat buyers. But often, it’s how well the merchant handles returns of online orders that can be the deciding factor in keeping a loyal customer.

That’s the principal finding in a new survey of 4,722 online buyers in the U.S. and Canada conducted earlier this month by customer feedback provider Bizrate Insights. The online survey was given to consumers immediately after completing a purchase at one of more than 4,500 e-commerce sites in the U.S. It shows that when a web merchant takes too long to process returns and issue credits, consumers are less likely to recommend that retailer in the future, and less likely to buy from them again.

77% of respondents said they’d be less likely to recommend a retailer if it takes too long to issue a credit.

Moreover, when asked what course of action they would take to respond to a merchant’s slow returns processing, 40% of respondents said they would stop shopping online with that retailer. Another 40% said they would limit their shopping with the retailer, while only 11% said it wouldn’t affect their likelihood to shop again.

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Consumers also expect to receive a credit quickly on returned merchandise. In fact, 72% of consumers say they’d be willing to wait five days to receive a credit once the retailer had received their returned merchandise; 24% of consumers say they’d wait 10 days; 3% say 20 days; and 1% say they’d wait longer than 20 days.

“Retailers should look to shrink the time line of their returns and credit process to 5 days maximum to meet the lion’s share of customers’ expectations and avoid possible implications from being too slow to issue credits,” says Hayley Silver, vice president of Bizrate Insights.

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Older consumers are less patient when it comes to receiving their credit, Silver adds. “Gen X and older customers are significantly less forgiving if a merchandise credit takes too long to come through as compared to Gen Y, with at least half of 35+ year olds considering stopping shopping online with a retailer that takes too long to issue a merchandise credit. “

If consumers are willing to wait no more than five days for a credit of returns, many online retailers have some work to do. A recent Internet Retailer study of the returns process of the top 30 online retailers in North America found that on average, retailers awarded a credit eight days after IR’s researchers returned merchandise. Many took a lot longer.

For more information on which retailers handled returns fastest, see Internet Retailer’s recently released research report on fulfillment and delivery entitled, Click, Ship & Return.

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