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False claims about damaged or missing items are the most common form of returns fraud, affecting 62% of U.S. retailers, while shoppers increasingly abandon brands with poor return policies, creating both a customer retention risk and a $2 billion opportunity for retailers who invest in better returns experiences and fraud detection tools.

• 63% of U.S. shoppers have stopped shopping with or abandoned purchases from retailers due to poor return policies
• False claims about damaged or missing items are the top returns fraud concern for 62% of retailers, followed by item substitution (54%) and wardrobing (38%)
• 44% of consumers admit to providing false reasons for returns, while 31% substitute items when returning purchases
• Only 43% of retailers use fraud detection tools, and just 19% use AI or machine learning—50% still rely on manual reviews
• 87% of shoppers would accept exchanges under the right circumstances, representing over $2 billion in growth opportunity globally

New research from Loop found that almost two-thirds (63%) of U.S. shoppers have either stopped shopping with a retailer or abandoned a purchase because of its return policy.

"Shoppers are judging brands on what happens after the sale, and that judgment turns into action. Looking at the data, shoppers are saying that a bad returns policy has made them walk away from a brand, whereas many retailers still aren’t recognizing or acknowledging this risk. This gap represents a...

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