January marks the start of a brand new year. That means consumers everywhere are making resolutions, joining gyms, journaling, cutting back on alcohol and calories, and engaging in other self-improvement activities.

Unfortunately for the world’s retailers, consumers are also returning products. A lot of products. Whether it’s unwanted Christmas gifts, that dress they never wore to the office party or the holiday punch bowl that wasn’t needed after all, retailers are seeing a veritable blizzard of returns this month — a phenomenon that’s become known in the industry as “Returnuary.” And, since the cost of processing a return averages about 30% of the product’s original price, this storm of product returns is every retailer’s nightmare.

As retailers have become more aware of the cost of returns, some consumers will also encounter a nightmare scenario this month: It may not be as easy to return products as it once was. As consumers drop their returned merchandise in the mail, or hand it over to a carrier, they might encounter new, unexpected fees. When they visit the returns desk at a store, they might be informed that they’re outside the new 15- or 30-day return window. A Blue Yonder survey revealed that 89% of retailers have changed their policies to reduce product returns, or at least offset the associated costs.

But the retail industry is divided over these tough new tactics, and with good reason. First, they might discourage shoppers from making a purchase, since over two-thirds of consumers say they’re deterred by strict return policies.

Second, retailers might offend and drive away loyal, well-intentioned shoppers who would otherwise have a high lifetime value. According to the National Retail Federation (NRF), 67% of shoppers report that a negative return experience would keep them from shopping with a specific retailer in the future. That moment when a retailer forbids a well-meaning consumer from returning a $39 sweater could have a much, much higher cost in the long run.

So what can retailers do to survive Returnuary with their short-term margins intact, while still driving longer-term, loyalty-based revenue? Here are three tips from Blue Yonder.

1. Know who’s returning and act accordingly

Certainly one strategy is to accurately distinguish a valued, repeat shopper from a consumer who engages in returns fraud, serial returning or the growing practice of “wardrobing” — wearing that sparkly sequined dress to the New Year’s Eve party, then returning it this week. Retailers have a surprising amount of data readily available to them that can help make this distinction.

Advanced digital solutions can gather this data — including individual customers’ history, purchasing behaviors and returns frequency — to deliver a personalized returns experience based on that data. Retailers can enforce stricter policies in response to today’s fast-growing volumes, but in a smarter, more targeted manner.

For instance, retailers can implement shorter returns windows for serial returners, while also flagging shoppers they suspect of returns fraud, wardrobing or other suspicious activity. Even if they choose not to prosecute fraudulent returners, retailers can make it harder for those individuals to commit fraud the next time. Conversely, retailers can deliver faster refunds and incentives to repurchase for loyal shoppers with a high lifetime value — driving future sales.

2. Make the returns process smarter year-round

While January has a high volume of returns, the fact remains that returns are a big — and growing — problem all year long. The NRF estimates that returned products represent almost 17% of all retail revenues for 2024.

Returning merchandise is becoming more commonplace all the time. About two-thirds of consumers engage in “bracketing,” or buying multiple sizes or colors of apparel items, with the intention of returning those that don’t fit. A staggering 46% of consumers report that they return products multiple times every month. It’s clear that, while Returnuary is an important event, returns are a year-round problem.

That makes it imperative for retailers to minimize the cost and time involved in every single return, every day. They can achieve that by making the process fast and seamless for the consumer with easy, label-less submissions. But they can also increase speed and efficiency by establishing real-time visibility across the returns process. As soon as a return is initiated, retailers can get resources in place to quickly receive and process that return.

Imagine if employees in the warehouse were ready with all the information they need when the returned product arrives — such as customer history, order details, complete product information, possible problems with the item’s condition and the return reason. Manual confirmations could be performed quickly, speeding the item back into selling position. Popular or seasonal items could be further fast-tracked, increasing their sell-ability and profitability.

While returns are an unavoidable challenge, retailers can do a lot to minimize the time and costs of the end-to-end returns cycle. They can also accelerate the product’s path back to the warehouse aisle or the retail shelf. Again, digital solutions are readily available to help.

3. Partner with an expert before another year passes

Returnuary is an annual event, which means retailers have 12 months to prepare for the 2026 post-holiday season. Why try to master the challenge of returns alone, when Blue Yonder has the retail expertise and advanced digital solutions to help?

Returns management capabilities from Blue Yonder support retailers in every stage of the reverse logistics journey, from returns initiation and drop-off kiosks through orchestration and processing. With decades of experience and hundreds of retail customers, Blue Yonder understands the complex problem of returns management — and we’ve developed advanced solutions that are custom-tailored to this real-world need.  

Today’s retailers face incredible challenges in addition to returns, including demand volatility, omni-channel competition, brand differentiation and labor shortages. Why not partner with an expert in returns management who can deliver a specialized solution quickly and cost-effectively — so you can focus on bigger issues?

Discover the power of Blue Yonder returns management for yourself by reaching out to us today.  Start taking strategic action right now, so you’re ready for a successful Returnuary 2026.