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Identifying and resolving the causes of product returns

Philips is known and respected for innovation and quality.

So, when Argos and Marks & Spencer challenged product quality, everyone in the business wanted to improve. I was appointed to reduce the rate of product returns.

Throughout my project, I established strong, collaborative relationships across Philips and with Retailers, Consumers and Suppliers. With my colleagues, I saved millions of pounds, restored relationships with key customers and created design standards for future products.

Jan Timmer, the President of Philips, recognised my work and shared it internationally at an away day.

Philips shield 2013

Three goals

To improve B2B customer satisfaction by reducing product returns.

To respond to customer concerns by improving current products.

To record design good practice for future products.

The actions I took

Developed Listening Posts:

– Worked with national and local returns centres to improve data collection.
– Set up and managed home use trials.
– Visited retailers to listen to feedback about the product and returns.
– Visited consumers to see the product in action.
– Introduced manual life testing.
– Assessed competitor kettles.
– Collected production test data.
– Work with technical experts, for example, materials and product experts.

Analysed Data

– Adopted ‘the eyes of the customer’ to understand returns comments.
– Introduced the idea we were selling a cup of tea, not an appliance (jobs-to-be-done).
– Worked across the business to establish root causes and solutions.

Addressed Immediate Issues

– Recommended modifications, my first prevent 40% returns and loss of retail contracts.

Established And Recorded Good Practice

– From manuals to switches I influenced the design of future of kettles.
– I recommended the reintroduction of water level indicators and the reduction of the rolling boil. In this way I highlighted the value of the environment to marketing, industrial design and product development.

The results I achieved

Reduced product returns by 60% saving £600,000 per year over three years. Examples of improvements:

  • In the first week recommended a product modification, preventing 40% returns and loss of retail contracts.
  • Recommended a colour change. Philips applied this to the entire family of products, slashing ‘No Fault Found’ returns.
  • Identified the cause of early element failures. Reduced costs for Philips and our supplier. Purchasing negotiated a price reduction for this improvement.
  • New operating instructions and product markings.
  • Introduced the idea of selling a cup of tea rather than a kettle (Job-to-be-Done).
  • Represented the Voice of the Customer in product development meetings.
  • Recommended changes to improve sales.

The Wrong Colour

Our product returns team received a lot of return’s labels saying ‘wrong colour’ when products came back from a UK catalogue shop. Over half of all returns had this problem and our relationship with the retailer was suffering.

But our product only came in one colour, and the team classed the returns as ‘no fault found’. They had a bias and didn’t know it.

Several months into the project, I visited an electronics store and noticed our product was placed on the bottom shelf. I spoke with a store assistant and she said ‘it’s quite dingy’. Heart pounding, I thanked her for her time and went to the catalogue shop. Sure enough, the photo showed a bright white product – not our light grey. Had I found the true cause of all those ‘wrong colour’ returns?

I wrote up my findings and told marketing, industrial design and the product owner. A month later, I learnt the entire range was being re-coloured eighteen months early. Within weeks our no-fault found returns returned to their normal, very low, level.

This small example has four important lessons for any VoC activity:

  1. Build a track record – my report was accepted because I had already suggested other changes that improved our returns rate.
  2. Empathy – seeing the world from your customers’ perspective is difficult. Practice and be ready to believe feedback that doesn’t chime with your world view.
  3. Build relationships – when I reported my findings I already knew the people and what interested them. This helped me put my recommendations in context of their goals and aspirations.
  4. Get into the wild – no amount of data, especially when it has passed through analytic tools, can trigger moments of inspiration in the same way as actually listening to a customer.

Other results

Philips’ reputation with major suppliers remained intact.

The colour change reduced returns rates across the kitchen appliance range.

The new colour range increased sales across the kitchen appliance range.

Awarded an MSc by the University of Brighton. “the improvement of the designed and delivered quality of fast moving consumer goods”.

Winner of the Chairman’s Award.

Being interviewed for awayday video

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