Boosting Membership Signups Through Return Fees: The H&M Approach — Retail Bum

H&M is now charging for online returns in several markets, including the United Kingdom and the rest of Europe unless customers enroll in its loyalty program.

The expansion of the policy comes after the Swedish fast fashion retailer began charging for returns in the U.S. over the summer.

In the U.K., the retailer is now charging customers a £1.99 fee for each returned package, which will be deducted from their refund. However, H&M members can still make returns without incurring any additional charges.

How return fees can boost loyalty

H&M’s decision to charge a return fee for non-members sends a clear message: becoming a loyalty program member offers tangible benefits.
Customers who frequently shop at H&M are more likely to view the membership as a valuable investment when they realize they can avoid return fees. This incentivizes them to sign up for the loyalty program to enjoy the cost-saving perks.

With that in mind, the introduction of return fees for non-members is also effectively enabling H&M to tackle the financial burden associated with processing returns. Returns are costly for retailers due to restocking, quality checks, and potential damage to items…