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Why ‘Returnless Returns’ Can Pay Off for Companies

Retailers are increasingly allowing customers to keep unwanted items and still get a refund. It isn’t just a question of costs.

By Lisa Ward, WSJ

July 24, 2025

Retailers are increasingly allowing customers to keep unwanted items and still receive a refund.

It’s called a “returnless return”—when a company tells you to just keep a product instead of returning it. Retailers save money by not having to process the return.

Now a new study has found that there’s an additional reason for companies to let shoppers keep the items: It boosts customer loyalty to the brand, with customers more likely to write positive reviews, recommend the brand and repurchase an item.

The study also found that how a company frames its returnless-return policy makes a difference. For instance, highlighting the benefit to the consumer or the environment, rather than the company, makes a better impression on shoppers. What’s more, suggesting that the buyer donate the unwanted item boosts a company’s appeal.

The researchers only studied returnless returns for relatively low-cost items. But within that constraint, the positive effects were “robust” for a range of products in the study at different price points, from a ballpoint pen to a sweater, says John Costello, an associate professor of marketing at the University of Notre Dame and one of the paper’s co-authors.

Positive reviews

In one part of the study, some participants were told they ordered a shirt online, then received the exact same item as a gift a day later. Some of them were told there was no need to return the shirt and they could do what they liked with it and receive a refund. Others were told that to get a refund they would have to return the shirt.

The researchers then asked the participants to write a review of the brand, and scored their responses for positive and negative sentiment. The reviews of participants who could keep the shirt were more positive on average than those of participants who had to return it.

In a follow-up experiment, participants who were told to donate the shirt to a person in need viewed the brand more favorably than participants told to dispose of it.

Trust emerged as an issue in another part of the study. Participants were told they bought a phone charger online but it was broken when they received it in the mail.

One group was told to keep the charger, but they were asked to submit a video or photo showing the damage before receiving a refund. Another group was told to keep the charger without showing any proof that it was defective.

Participants then rated how likely they were to recommend or say positive things about the brand. Participants who were told to keep the phone with no questions asked were more likely to promote the brand than those who were required to show proof of damage.

Motivation matters

Brands also got points from consumers for altruism. For example, in one part of the study participants were told they purchased fruit online but the quality was off when they received the shipment. Three groups were told to do a returnless return, but the reason they were given for the brand’s policy differed for each group.

For one group, the company explained that returnless returns make customers’ lives better. For another group, the company pointed to reduced carbon emissions, and for the third group a reduction of the company’s costs was cited.

Participants who were told that returnless returns made their lives easier were the most likely to recommend the brand, repurchase the fruit and view the brand warmly. Those who were told the brand was trying to cut carbon emissions were the next most positive about the brand, and those who were told the company was trying to save money were the least positive of the three groups.

“We find that brands can really benefit from returnless returns if they act more communal than transactional,” says Costello.