Gathering customer data

In their efforts to curb the problem, retailers deploy multiple loss and fraud prevention strategies. One of the most effective involves capturing customer data at the point of return. Along with the initial receipt, a merchant might require a customer to show a driver's license or perhaps the .

By identifying who is returning its goods, a retailer gains a handful of benefits. First is the deterrence value. By , perpetrators must work harder for their plans to succeed. Further deterrence is achieved by increasing the likelihood that the fraud will be identified and that the perpetrators will be subject to law enforcement.

Another benefit for the retailer is that data capture, coupled with appropriate databases and procedures, will help to identify customers who have a tendency to return more items than is the norm. While this may or may not indicate wardrobing, a merchant can at least add riders to its return policies, for example, limiting the number of returns for any given customer over a given period.

Retailers often place restrictions on practices such as returns without a receipt or returns where the refund takes a form other than that of the purchase (e.g. a cash refund of a credit card purchase). But bear in mind, the nature of return policies will have an impact on both their effectiveness in stimulating sales as well as in promoting or sustaining customer satisfaction and loyalty. As such, retailers need to carefully and frequently review data relating to returns in order to understand, refine and optimize such policies.