What are average return rates for ecommerce?

The average ecommerce return rate typically sits in the mid-teens to high-twenties percentage range, but the exact figure varies by product category and season. To see whether your store is above or below par, divide total items returned by total items sold and multiply by 100—then compare to your industry’s common band.

Current industry data shows most online retailers experience return rates between 20.4% and 24.5% as of 2024, with projections suggesting continued growth through 2025. However, these averages mask significant variation: apparel stores often see rates climbing toward 30-40%, while electronics and beauty retailers typically maintain single-digit to low-teen percentages.

Numbers at a glance

• 20.4% — Average U.S. ecommerce return rate (2024)
• 24.5% — Projected average return rate for 2025
• 30-40% — Typical apparel return rate range
• 8-10% — Electronics category average
• 4-10% — Beauty and skincare returns
• 15-20% — Home goods and furniture
• 51% — Gen Z shoppers who admit to bracketing
• 15.1% — Return fraud rate across ecommerce

What is a “return rate” and why it matters

Understanding your return rate starts with getting the calculation right and recognizing its broader business impact beyond simple customer service metrics.

Formula & quick calculator

The return rate formula is straightforward but requires consistent measurement:

Return Rate = (Number of Items Returned ÷ Total Items Sold) × 100

For example: If you sold 10,000 items in Q4 and processed 2,000 returns, your return rate would be 20%.

Important distinction: Return rate differs from refund rate (which includes partial refunds without product returns) and exchange rate (which tracks swaps rather than full returns). Most industry benchmarks refer specifically to physical product returns requiring reverse logistics.

How returns impact profit, CX and sustainability

Returns create a cascade of costs that extend far beyond the initial refund amount. Processing a typical return costs retailers between $10-$20 per item when factoring in reverse logistics, inspection, restocking, and potential markdowns for damaged goods.

The customer experience implications run both ways: generous return policies can increase conversion rates by 30-40%, but high return rates often signal deeper issues with product descriptions, sizing, or quality that erode long-term customer satisfaction.

From a sustainability perspective, returned items generate 5.8 billion pounds of landfill waste annually in the U.S. alone, with only 50% of returns making it back to sellable inventory.

The typical range: industry benchmarks

Return rate expectations vary dramatically across product categories, with some verticals naturally experiencing higher rates due to fit, preference, or purchase behavior patterns.

Overall retail averages

The National Retail Federation reported the average U.S. ecommerce return rate at 20.4% for 2024, representing approximately $362 billion in total online returns. Industry projections from CapitalOne Shopping suggest this figure could climb to 24.5% by 2025 as consumer behaviors like bracketing become more prevalent.

These industry-wide averages mask significant variation between business models, with direct-to-consumer brands often experiencing higher rates than traditional retailers due to less restrictive return policies and higher customer acquisition costs that justify generous return terms.

Category snapshots

Apparel leads the pack with return rates frequently reaching 30-40%, driven primarily by sizing inconsistencies and the subjective nature of fit and style preferences. Some fashion retailers report rates as high as 88% during peak promotional periods when customers engage in heavy bracketing behavior.

Electronics maintain lower rates at 8-10%, benefiting from standardized specifications and lower likelihood of subjective dissatisfaction. However, this category sees higher fraud rates due to the resale value of returned items.

Beauty and skincare products typically experience 4-10% return rates, kept low by hygiene concerns and sample programs that reduce purchase uncertainty. The rise of virtual try-on technology has further reduced returns in this category.

Home goods and furniture fall in the middle range at 15-20%, with returns often driven by size/space mismatches rather than product defects. The high shipping costs for bulky items naturally discourage frivolous returns.

Seasonal spikes & promotion effects

Return rates typically surge 25-35% during peak shopping seasons, with January seeing the highest monthly return volumes as holiday gift recipients exchange unwanted items. Black Friday and Cyber Monday purchases show return rates 40-50% higher than baseline due to impulse buying and gift-giving uncertainty.

Promotional periods create additional return pressure through bracketing behavior, where customers purchase multiple variants with the intention of keeping only one. This practice has intensified with the rise of social media influence and “haul” culture, particularly among Gen Z consumers.

7 factors that drive your return rate up or down

Understanding the root causes behind returns enables targeted interventions that can significantly impact your bottom line without alienating customers.

Product fit & sizing issues

Sizing problems account for approximately 34% of all ecommerce returns, making this the single largest controllable factor for most retailers. The challenge extends beyond simple measurement discrepancies to include inconsistent sizing across brands, inadequate size guides, and cultural differences in fit preferences.

Successful retailers invest heavily in size prediction technology, detailed measurement guides, and user-generated content showing products on diverse body types. Virtual fitting rooms and augmented reality try-on experiences can reduce size-related returns by up to 64%.

Expectation mismatch

When products don’t match customer expectations set by marketing materials, return rates spike dramatically. This includes color variations between screens and reality, texture or material quality differences, and functionality gaps between advertised and actual capabilities.

Professional photography with consistent lighting, detailed product videos, and authentic user-generated content help bridge the expectation gap. Brands that invest in 360-degree product views and zoom functionality see 30% fewer returns related to visual disappointment.

Shipping damage & packaging

Approximately 20% of returns stem from products damaged during shipping, making packaging optimization both a cost-saving and customer satisfaction initiative. Inadequate protection, poor box sizing, and rough handling during transit contribute to this category.

Smart packaging solutions that right-size boxes and provide adequate protection can reduce damage-related returns by 40-60%. Some retailers have found that investing in premium unboxing experiences actually reduces return rates by increasing perceived value.

“Bracketing” behavior

Bracketing—purchasing multiple sizes or colors with the intention of keeping only one—has become a major driver of return rates, particularly in apparel. Over 51% of Gen Z shoppers admit to this practice, affecting 25% of all ecommerce transactions in some categories.

While completely preventing bracketing is difficult without alienating customers, retailers can discourage it through size recommendation engines, virtual try-on tools, and strategic return policy adjustments like restocking fees for excessive returns.

Fraud & wardrobing

Return fraud, including wardrobing (using items temporarily before returning them), accounts for 15.1% of all returns. This first-party fraud is particularly prevalent in apparel, electronics, and special occasion items.

Detection strategies include tracking return patterns, implementing return windows that discourage temporary use, and using technology to identify previously worn or used items. Some retailers employ discrete tagging systems that make wardrobing more difficult.

Policy design

Return policy structure significantly influences both return rates and customer acquisition. Overly generous policies can encourage frivolous returns, while restrictive policies may hurt conversion rates and customer lifetime value.

The optimal approach balances accessibility with reasonable guardrails: 30-day windows for most categories, free returns with minimum order thresholds, and clear guidelines about item condition requirements. Successful retailers A/B test policy changes to find the sweet spot for their customer base.

Channel mix

Buy Online, Return In Store (BORIS) programs show 48% higher fraud rates than other return methods, but they also increase customer lifetime value by driving additional store visits. The channel mix affects both return rates and the cost of processing returns.

Pure-play online retailers often see higher return rates than omnichannel competitors because they lack physical touchpoints where customers can examine products before purchase. However, they can offset this with superior digital experiences and more flexible return processing.

Self-assessment: is your store above or below average?

Benchmarking your performance requires consistent data collection and analysis frameworks that go beyond simple return rate calculations.

Data to collect

Start by tracking these core metrics monthly: total orders, total items sold, total items returned, return reasons (categorized), time from purchase to return request, and final disposition of returned items (resold, donated, discarded).

Supplement quantitative data with qualitative insights from customer service interactions, return reason surveys, and product review analysis. This combination provides the context needed to identify improvement opportunities.

5-step spreadsheet audit template

Step 1: Calculate your overall return rate using the formula above, then segment by product category, price point, and acquisition channel to identify patterns.

Step 2: Categorize return reasons into controllable (sizing, description accuracy, quality) and uncontrollable (gift returns, buyer’s remorse) buckets.

Step 3: Analyze timing patterns—returns within 7 days often indicate immediate dissatisfaction, while later returns may suggest durability or fit issues that emerge with use.

Step 4: Compare your rates to industry benchmarks for your primary categories, flagging any segments that exceed typical ranges by more than 5 percentage points.

Step 5: Calculate the true cost of returns including processing, shipping, restocking, and lost inventory value to understand the financial impact of improvement opportunities.

Red-flag thresholds to watch

Return rates exceeding 25% in electronics, 45% in apparel, or 25% in home goods warrant immediate investigation. Additionally, watch for return fraud indicators: customers with return rates above 50%, returns concentrated in high-value items, or patterns suggesting wardrobing behavior.

Seasonal variations beyond 40% of baseline rates may indicate promotional strategy issues or inventory quality problems that require attention.

How to bring your rate back in line

Reducing return rates requires a systematic approach targeting the highest-impact factors while maintaining customer satisfaction and competitive positioning.

Pre-purchase levers

Invest in detailed size guides with fit recommendations based on customer data and body measurements. Implement size prediction algorithms that learn from return patterns to suggest optimal sizing for individual customers.

Enhance product imagery with multiple angles, zoom functionality, and lifestyle shots showing products in use. User-generated content, particularly photos and videos from verified purchasers, significantly reduces expectation mismatches.

Deploy virtual try-on technology where applicable, and consider offering samples or try-before-you-buy programs for high-return categories. These upfront investments typically pay for themselves through reduced return processing costs.

Post-purchase levers

Optimize packaging to prevent damage while creating positive unboxing experiences that increase perceived value. Right-sized packaging reduces both shipping costs and damage rates.

Implement proactive customer communication throughout the fulfillment process, including shipping notifications, delivery confirmations, and usage tips that help customers get maximum value from their purchases.

Consider offering exchanges before returns, partial refunds for minor issues, or “keep it” policies for low-value items where processing costs exceed item value.

Policy optimization without alienating shoppers

Test return window lengths to find the optimal balance—too short frustrates customers, too long encourages wardrobing. Most successful retailers settle on 30-45 days for most categories.

Implement tiered return policies based on customer history: loyal customers with low return rates earn more generous terms, while new customers or those with high return rates face modest restrictions.

Consider restocking fees for specific situations (opened electronics, special orders) but communicate these clearly at purchase to avoid surprise charges that damage customer relationships.

Technology stack & apps

Return management platforms can automate much of the return process while providing valuable analytics. Look for solutions that integrate with your ecommerce platform and provide customer-facing return portals.

Implement fraud detection tools that flag suspicious return patterns without creating friction for legitimate customers. Machine learning algorithms can identify wardrobing, bracketing, and other problematic behaviors.

Consider reverse logistics partnerships that can process returns more efficiently than in-house operations, particularly for businesses without dedicated warehouse space.

Tracking progress: KPIs & reporting cadence

Effective return rate management requires ongoing monitoring and adjustment based on comprehensive metrics that go beyond simple return percentages.

Key complementary metrics

Track your exchange rate (percentage of returns that become exchanges rather than refunds) as this indicates customer satisfaction and reduces the financial impact of returns. A healthy exchange rate typically runs 20-30% of total returns.

Monitor your “keep rate”—the percentage of returned items that can be resold at full price. This metric indicates both packaging effectiveness and return fraud levels. Keep rates below 60% suggest significant operational issues.

Calculate return processing time from customer request to refund completion, as delays in this process significantly impact customer satisfaction and likelihood of repeat purchases.

Benchmarks to re-check quarterly

Review industry benchmarks quarterly as they shift with market conditions, consumer behavior changes, and competitive dynamics. What constitutes “normal” return rates evolves over time.

Reassess your return policy effectiveness by comparing customer acquisition costs, lifetime value, and satisfaction scores across different policy iterations.

Monitor competitor return policies and customer feedback to ensure your approach remains competitive while protecting profitability.

Frequently asked questions

Is free returns still worth it?

Free returns typically increase conversion rates by 30-40% and customer lifetime value by 20-25%, making them worthwhile for most businesses despite the direct costs. However, consider implementing minimum order thresholds or absorbing return shipping into product pricing rather than offering unconditional free returns.

How long should my return window be?

Most successful ecommerce retailers use 30-day return windows, which balance customer convenience with operational efficiency. Longer windows (60-90 days) may increase conversion rates but also enable wardrobing and increase processing costs. Test different windows with your customer base to find the optimal balance.

When is ‘keep-it’ cheaper than processing?

For items under $15-20, the cost of reverse logistics often exceeds the item value, making “keep it” refunds financially sensible. This threshold varies by business model, but factor in return shipping, processing labor, inspection time, and the likelihood of successful resale when making these decisions.

What is considered a good ecommerce return rate?

A “good” return rate depends heavily on your product category. For electronics, anything under 12% is excellent, while apparel retailers should aim for under 35%. The key is comparing against category-specific benchmarks rather than overall industry averages, and focusing on the trend direction rather than absolute numbers.

Why are online return rates higher than in-store?

Online return rates are nearly three times higher than in-store (24.5% vs 8.71%) because customers can’t physically examine products before purchase. This leads to more sizing issues, expectation mismatches, and impulse purchases. Additionally, the convenience of online returns and generous policies encourage bracketing behavior that’s less common with in-store purchases.

How do you calculate your product return percentage?

Use this formula: (Number of Items Returned ÷ Total Items Sold) × 100. Track this monthly by product category, not just overall. For example, if you sold 1,000 items and received 200 returns, your return rate is 20%. Always measure consistently—some retailers track by order value instead of item count, which can skew comparisons.

Which industries have the highest online returns?

Apparel and accessories lead with 30-40% return rates, followed by home goods at 15-20%. Electronics maintain the lowest rates at 8-10%, while beauty products typically see 4-10% returns. Seasonal and promotional periods can push these rates 40-50% higher than baseline across all categories.

Does charging for returns lower return rate?

Yes, return shipping fees can reduce return rates by 15-25%, but they also decrease conversion rates by 10-15% and customer lifetime value. The net effect varies by business model. Consider alternatives like minimum order thresholds for free returns or restocking fees for specific situations rather than blanket return charges.

How long should an online store’s return window be?

Most successful retailers use 30-day windows, which balance customer confidence with operational efficiency. Longer periods (60-90 days) may boost conversion rates but enable wardrobing and increase processing costs. Test different windows with your customer base, but avoid going below 14 days as this significantly hurts conversion rates.

What tools help track and reduce returns?

Return management platforms like Loop, Happy Returns, or ReturnGO automate processing and provide analytics. Size recommendation engines, virtual try-on tools, and AI-powered product matching can prevent returns. Fraud detection software helps identify problematic patterns without creating friction for legitimate customers.

How do seasonal sales affect return rates?

Holiday and promotional periods typically see 40-50% higher return rates due to gift purchases, impulse buying, and bracketing behavior. January consistently shows the highest return volumes as gift recipients exchange items. Plan for 25-35% capacity increases during peak seasons and extended processing times.

Can generous return policies increase sales?

Yes, generous return policies can increase conversion rates by 30-40% and average order values by 15-20%. However, they also increase return rates and processing costs. The key is finding the sweet spot where increased sales offset higher return costs while maintaining customer satisfaction and competitive positioning.

What is “bracketing” in ecommerce?

Bracketing is when customers intentionally purchase multiple sizes, colors, or versions of a product with the plan to keep only one and return the rest. Over 51% of Gen Z shoppers admit to this practice, which significantly inflates return rates in apparel and other fit-sensitive categories. Combat it with better size guides, virtual try-on tools, and strategic policy adjustments.

Key takeaways

Understanding your return rate in context is crucial for ecommerce success. While industry averages provide useful benchmarks, focus on your specific category norms and customer behavior patterns rather than chasing arbitrary targets.

The most effective return rate optimization combines pre-purchase improvements (better product information, sizing tools) with post-purchase excellence (packaging, customer service) and smart policy design that balances customer satisfaction with operational efficiency.

Start by implementing the 5-step audit process outlined above to understand your current performance, then prioritize improvements based on potential impact and implementation difficulty. Remember that some level of returns is healthy—it indicates customers feel confident making purchases and trust your return process.

Sources & references

• National Retail Federation — 2024 Consumer Returns in the Retail Industry report
• CapitalOne Shopping — Average Retail Return Rate 2025 data and projections
• Shopify Commerce Trends — Ecommerce returns analysis and benchmarks
• ReturnLogic — Return fraud and wardrobing statistics
• Outvio — Comprehensive ecommerce return rate analysis
• ClickPost — Industry return statistics and trends