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The title of this blog post is E-commerce Giants Turn to AI to Tame the Beast of Returns

The title of this blog post is E-commerce Giants Turn to AI to Tame the Beast of Returns

The title of this blog post is E-commerce Giants Turn to AI to Tame the Beast of Returns

2025-02-19 09:47:07


E-commerce Giants Turn to AI to Tame the Beast of Returns


The world of online shopping has long been plagued by a daunting problem returns. According to a study by McKinsey and The Business of Fashion, up to 30% of fashion items bought on the internet are sent back, resulting in significant financial losses for e-commerce giants.


The Problem A Costly Conundrum


Each returned package costs between $21 and $46 on average, considering the costs of transportation, treatment, and making the item fit for resale again. This trend not only drags down profit margins but also leaves customers unsatisfied with their online shopping experience.


The Solution AI-Powered Sizing Advice


To combat this issue, many e-commerce companies are turning to artificial intelligence (AI) for help. One such solution is Fringuant's AI-driven algorithm, which provides sizing advice based on a customer's height, weight, and a quick selfie taken on their phone. This innovative approach has already seen success with clients like Maje, who have reported a dramatic drop in returns.


The Technology AI-Powered Selfie Analysis


Fringuant's AI model is trained for a year on thousands of photos, allowing it to detect age, gender, and other key factors that inform its sizing recommendations. This technology has the potential to revolutionize the way customers shop online, ensuring a better fit and reducing the likelihood of returns.


Success Stories A Growing Portfolio


Fringuant's portfolio of clients now boasts over 20 e-commerce companies, each seeking to harness the power of AI to improve their return rates. Another notable example is Zalando, which acquired Swiss startup Fision in 2020 as part of its efforts to reduce returns.


Avoiding Returns AI-Powered Shipping and Inventory Management


In addition to sizing advice, AI is also being used to prevent returns caused by shipping errors and automate inventory management processes. ID Logistics, for instance, has equipped its trolleys with smart cameras that check the accuracy of orders in real-time. This technology has already reduced incorrect parcel delivery rates by 90%.


Conclusion The Future of E-commerce


As e-commerce continues to evolve, it is clear that AI will play a crucial role in shaping the industry's future. By leveraging AI-powered sizing advice, shipping and inventory management solutions, e-commerce giants can reduce returns, improve customer satisfaction, and drive business growth.


Keywords AI, E-commerce, Returns, Sizing Advice, Shipping Errors, Inventory Management

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