Daybreak - Are you a good, bad, or an ugly customer? Myntra knows

Episode Date: August 29, 2024

A big reason when we choose to buy online instead of going to a store depends on how easy the e-commerce company makes it to return stuff. So far, with most companies, all you have to do is ask for a return on the app or website and someone comes to your doorstep and picks it up.While e-commerce companies have been wooing you with the option, in reality they hate returns because reverse logistics are a costly affair for them.Which is why e-commerce platforms like Ajio and Myntra are changing their return policies. Some are even blocking some customer accounts.  But are customers ready to give it up yet?Tune in.* This story was previously featured on Daybreak in April, 2024P.S Don't miss our brand new Thursday segment, DAYBREAK UNWIND, in this episode!This week's recommendations:Snigdha: To read: The Buddha in the Attic by Julie OtsukaTo watch: Kalki 2898 ADRahel:To watch and listen: Hanumankind – Big Dawgs | Ft. Kalmi Daybreak is now on WhatsApp at [phone]. Send us a hello with your name and be a part of the Daybreak community. Also, if you have any recommendations for next Thursday's Unwind, send them to us as texts or voice notes.

Hi, this is Rohan Dharma Kumar. If you've heard any of the Ken's podcasts, you've probably heard me, my interruptions, my analogies, and my contrarian takes on most topics. And you might rightly be wondering why am I interrupting this episode too. It's for a special announcement. For the last few months, I and Sita Raman Ganesh, my colleague and the Ken's deputy editor, have been working on an ambitious new podcast.

It's called Intermission. We want to tell the Sita Ramancahans, my colleague. secret sauce stories of India's greatest companies. Stories of how they were born, how they fought to survive, how they build their organizations and culture, how they managed to innovate and thrive over decades, and most importantly, how they're poised today. To do that, Sita and I have been reading books, poring over reports, going through financial statements, digging up archives, and talking to dozens of people.

And if that wasn't enough, we also decided to throw in video into. to the mix. Yes, you heard that right. Intermission has also had to find its footing in the world of multi-camera shoots in professional studios, laborious editing, and extensive post-production. Sita and I are still reeling from the intensity of our first studio recording. Intermission launches on March 23rd. To get an alert, as soon as we release our first episode, please follow Intermission on Spotify and Apple Podcast. or subscribe to the Ken's YouTube channel. You can find all of the links at the ken.com slash I am.

With that, back to your episode. If you order stuff from e-commerce websites like Mintra and AGO, you're either a good customer, a bad customer, or an ugly customer. Yeah, that is how e-commerce companies have been categorizing you and I lately. And no, it is not based on how much money you spend. on these sites. It is based on how often you return items. Now, I'm speaking for myself here, but I'm sure this holds true for most people that the whole point of not going to a store to buy clothes and ordering stuff online is the fact that e-commerce companies make it easy to return stuff.

What if it doesn't fit me or what if it is damaged? Just ask for a return and somebody comes to your doorstep and picks it up. And it's all free. no problem, right? Actually, there is a problem. E-commerce companies hate returns, because as it turns out, return or reverse logistics is a very costly affair for them. And now, it's come to a point where the likes of Agio and Mintra are changing their return policies and some are even blocking some customer's accounts. But the question is, are customers ready to give it up yet? Also, what about the logistics services companies like delivery and blue dot and shadow facts because for them returns are a huge source of revenue. Welcome to Daybreak, a business podcast from the Ken.

I'm a host Nick Das Sharma and I don't chase the new cycle. Instead, thrice a week on Mondays, Wednesdays and Fridays, I will come to you with one business story that is worth understanding and worth your time. You know what a Flipkart executive told my colleague Noha Burbrae? Let me tell you in their exact words, and I'm quoting, at a Flipkart warehouse somewhere right now, a Wishmaster or an E-Cart delivery executive, is sniffing the returned apparel to decide which section to put it into, fresh, refurbished or scrap. It is gross.

And if the customers think they are fooling us by returning used clothes, they are not. End quote. By the way, E-Cart is Flipcourt's own logistics. facility, Mintra 2 has Mintra logistics, and AGIO works with delivery, Ecom Express, Express Bs and Shadowfax. Still, 10 to 20% of customers' orders are outsourced to 3 PL or third-party logistics companies like delivery. And this is mainly because only they have services in certain areas.

Now, coming back to the good, bad and the ugly. An AGIO warehouse manager explained the category. to us. Apparently, a good customer is someone whose return rate is as low as 20%. Someone with a 20 to 40% return rate falls under the bad customer bracket. And others with even higher return rates are branded as poor or ugly customers. So now that you know whether you're good, bad or ugly, let us try to understand the why. And to do that, we have to look at the logistics of returns a bit more closely. So, a 3PL service provider like delivery or Shadowfax charges e-commerce companies anything

between 40 to 100 rupees to deliver a forward side package, which is from the e-commerce company to the customer. But reverse logistics, which is from you back to the e-commerce company, costs at least 15 to 20 rupees more per item. For example, a manager involved with AGO's supply chain team told the Ken that the cost of forward logistics for AGO is approximately $38. For reverse logistics, it pays an additional $22. Now, you may ask, why is it so expensive? Remember the E-Cart Wishmaster sniffing returned clothes?

Somebody has to check the returned items. 3PL companies charge the brands 5 to 10 rupees. for receiving an item, unpacking it, examining it, and adding it to the inventory for the next customer. An executive told us that nearly 30% of the items come back as returns, and of this, 8% goes back to the inventory. The remaining will eventually go back, but it would need some fixing like stain removal, stitching and button fix, etc. So the more the delivery distance, the higher the fee e-commerce platform, pay these 3PL companies. And it is because of the same reason that e-commerce companies have divided areas for deliveries

into five zones. For a factory outlet located in Delhi, a customer who lives within the city would be in delivery zone A. Outside that area, up to a distance of 150 kilometres would fall under zone B. But this is only if the item is transported directly without stops in the market. middle. For example, between Delhi to Greater Noida or Bangal to Mysore. Every other place in the whole country falls under Zone D. And then there are also far-off locations like Jammu and Kashmir, the North East States and the Andaman and Nicobar Islands. They all are under Zone E. Naturally,

Zone E is also the most expensive. So understandably, in all of this, while delivery companies are benefiting the most, e-commerce companies are losing up. So what are they doing about it? I will tell you in the next segment. The most extreme measure that we came across was Reliance's Agio. It is quite literally blocking off customers' accounts. On average, Adju, which has nearly 20 million monthly active users, blocks 150 accounts every week. A warehouse manager told my colleague Nuhar that it was an organization level call after a meeting with the chief

experience officer or CXO. Mintra, meanwhile, altered its return policy in November 2022. And then it imposed a convenience fee of $2999 on customers whose return rates were twice the average. The irony here is that Mintra used to encourage customers to return items as a part of its customer acquisition strategy. In June 2020, Mintra reduced the standard return. period from 30 days to a fortnight.

Flipcott, which Mintra is a part of, had already done this back in January 2020 when it brought it down to 10 days. But a former Flipcott category manager told us that this did not help because 80 to 90% of their customers return the items within the first three days of purchase. During the same period, Mintra also introduced the concept of a no-return coupon. The idea was to give a 15% discount for items on the checkout page in exchange for customers giving up their power to return. FlipCart, meanwhile, began giving away low value items worth between 100 to 150 rupees for free if customers requested a return. Agio2 provides a refund of 50 rupees on the complete order if the buyer cancels their return request.

Now, all of this does seem to be helping. because all these e-commerce companies are seeing a gradual drop in their return rates. But ultimately, the question that remains unanswered is this. What will shopping online be without free and easy returns? Because you can't just get your customers used to something so crucial that shapes their entire shopping experience and then suddenly take it away from them. Hello, we're trying something new today. Welcome to Daybreak Unwind.

Okay, this is happening on a Thursday because Tickda and I believe that Thursday is the day that we start our unwinding process for the week. Planning the unwinding process for the week. We're figuring out what we're going to do over the weekend, making plans. And that's something Stigda and I believe

that we're really good at. Because you should know when we're not working on daybreak, we spend a lot of time talking about things that we like. So books, movies, TV shows, all sorts of things. basically we're always looking for a great recommendation. It could be absolutely anything. Even that trashy reality show you don't want to admit in public that you're watching. We live for it.

We love it. It could even be a podcast as long as it's daybreak. Just kidding. It could also be something else. The point is that we have a lot of these fun conversations that don't ever really make it to the podcast. That don't make it to the episode. But we really want to change that. And then we realized that why is it just the two of us?

You know, we have this phenomenal community of listeners, this daybreak community that I'm sure has recommendations of their own that they'd want to share. So we want you to be part of this conversation that we're having. Okay, so we're going to try something different. It's an experiment. You are going to be a part of this process with us. Yes. If you have a really great recommendation that you think that the daybreak community just has to hear, we want you to send us a text or a voice note. Daybreak is now on WhatsApp.

This is not a drill. We are on WhatsApp. So you can message us. This is our number. 8971-08379. I'll repeat it at the end of the segment. Like, you know how they have. Like tambola.

Because it's number 1-8-00. But I promise it's not spam. This is our number. If you don't live in India, you can just add a plus 9-1 before feeding in the number. But to get the ball rolling, Snigda and I have a few of our own. recommendations to share this week.

Slingta, take it away. You want me to start? Yes, please. Okay, I have two recommendations. One is a good recommendation, one is a trashy recommendation, okay? So I'll begin with a good one. Okay. So it's this book, it's called Budan the Arctic,

and it's by this Japanese American writer called Julio Tzuka. And it's a novella. And it's written like, it's prose, but it's written like poetry. So it's like, yeah. prose poetry, it's a novella. And it's set, you know, between the time of World War I and World War II. So, you know, in the U.S., there was this huge population of Japanese immigrants, right? I think they started coming in during the 1800s. So they'd been there forever. And so they would actually get male order brides. Have you heard of male order brides? Yes, I have heard of male order brides. Is it about male order brides? Yes. It's so good.

So basically, you know, in San Francisco, all these male order brides would arrive from Japan all the way from Japan. And that is essentially the subject of the story, right? And, you know, what's so interesting is about, you know, about the way that she's written this is that, you know, the narrator of the story is us. It's a collective voice, which is so rare. Kind of like the daybreak community. Right. So, like, it's written from the POV of us or we. Wow.

You know, so all these women who got on the boat from, like, you know, big cities, towns, the countryside of Japan, like, from all different classes. You know, somebody's father was a farmer, somebody was, like, some rich man's daughter. All of them are collectively, like, put together on this boat and they sent to the US, right, as male order brides. And they've all received pictures from their prospective husbands, you know, these men who are, like, suited and booted, so well-dressed, you know, hair in place. standing in front of a beautiful house with a car, you know, and all these women, they're on the boat and they're dreaming about their future life and, like, you know, how lovely it's going to be.

And obviously, you know, reality is quite different. And it turns out most of them were misled. And, you know, the whole story is about, you know, how they're dealing with all of that, you know, their marriage, giving birth, raising children, cleaning the house, cooking. And also, of course, the very on-your-face racism. that existed in the US at that time, right?

And suddenly the World War II happens, and Pearl Harbor takes place, right? And Japanese folks from around the United States, they're being sent to concentration camps, intermittent camps, right? And so basically all these people, their whole community is uprooted. And suddenly the story goes from, you know,

the collective voice, to these very individual stories of these particular ways. women and their children and these families. And it's just like so beautiful, so haunting. Wow. I'm convinced. Yeah.

And it's written like poetry. I'm going to borrow this from you. It's crazy. That's amazing. That's all so good. Yeah. So that is my first recommendation. Your trashy recommendation.

You go first and then I'll come to my trashy recommendation. My recommendation now is a little lame because I feel like I'm quite late to the game. Go on. Okay. But mine is actually an artist that we've all heard. heard by now. He's all over the internet. He's all over social media. All over the reels. I'm talking about Hanuman Kain. Oh my God. They were just playing him at the T-shop near her office. Were they? Yesterday. Yeah. Oh, really? Yes. You know, it's so funny. Big dog. It's so funny. I heard

his song when everyone started talking about Hanuman kind of. I was talking, I listened to Big dogs and I just didn't get it initially. I was like, hey, this kind of sounds like a Drake song. Like just another song, you know? And then I watched the video and I was like, okay, wow, this is really cool. Yeah. And then, like, it just kept playing over and over again. It's like one of those yearworm songs that just gets up. And now I love it.

Like, I run to it. I really enjoy it. And then I was coming to work the other day. And I was sitting in the auto and there was this guy in an SUV. He rolls down his window. And what is he listening to? Of course. Loudly, like blaring on his speakers.

He was having the best time. And I'm just, I'm so fascinated by how this guy blew. He's been around for a while. He's been in the scene for some time. He has, I've listened to a little bit of, like, his other stuff. Yeah, and it's great. He's so good. He's so good.

And he's Maloo, which is fantastic. Exactly. I know, I know. He speaks very beautiful Malialum, by the way, without an accent. Actually, he's grown up in the US or something. Yeah, he grew up in Houston and then came back to India. And he used to work at Goldman Sachs, it seems. Are you serious?

Yeah. to wrap on the side and he was working at Goldman Sachs and now obviously he's doing music full time. That's such a Bangalore, you know. I know. But most fun, you know this already, Sinkta, this may be news to our... Yeah, for listeners. Tell them, tell them.

We're trying to figure out how to kind of plug this in an episode in the most casual non-flex way, but we might as well flex. Listeners, the music that you listen to every day in our daybreak episode, our theme music is by Kalmi. Yes. Kalmi of big dog fame. Yes. Yes.

That Kalmi. He's the producer. Yeah. The producer. It's like Big Dog Hanaman Khan Khan Khan. Featuring Kalmi. Yeah. So we're pretty cool actually if you want to be part of our community or something.

So, you know, there are a couple of people who've written to us saying that they hate the music in between. So there you go. Yeah, I'm very sorry. but the theme music is going nowhere. Yes, it's never going to change. Ever, unless Kalmi comes back and says he'll do like a new theme song with Hanuman kind. Oh my God. That'll be the day.

But the video is fantastic, man. It's amazing. Yeah. Actually, that's how I noticed. That's how I got to know this song because I saw the video, I think, on Instagram. And it's so cinematically. Amazing. Arresting.

I've seen that. So if you watch the video for. context, it features this thing called the well of death, which is very common feature at a lot of carnivals. I mean, if you've grown up going to carnivals fairs, circuses, you may have seen. Have you seen a well of death ever? I have. Have you?

I have never. I have. Once in, so I grew up in Dajling, right? So this was on the border of Dajling and Sikkim. And it's this place called Jorhtang. And every January, they would have this. Mela circus and I remember I was very young and my dad used to take me every year and I got lost in the Mela once. But that's where I saw the well of death.

Oh, sure. Or the ring of death. Yeah, that's amazing. I mean, not the getting lost part, but the well of death part. Yeah, it's incredibly filmed. It's amazing and it's in, it was shot in this in this. place in Kerala. Oh, yeah.

That's actually known for its carnival and its fairs. Oh, really? Yeah, they're so amazing. So apparently the director of the film, of the music video is this guy called Bejoy Shetty. Yeah. And he, they happened to be in that town at exactly, you know, when they were, whatever, doing a rec. I may be completely wrong here. They were doing a recie.

The carnival was shutting down and they requested the people that were running. to keep the well of death. Going. Yeah, for a few more days so that they could film their video and stuff. But, and you know, what's the most iconic, the Maruti 800? Yeah, it's a Maruti 800, right? It's a white Maruti. Isn't it?

It's a white Maruti. Yeah, yeah, it's a white Ruffi. Okay, I'm excited to hear your trashy recommendation. Oh my God. Okay. So, my trashy recommendation is this movie, a Bollabut movie, called Kalki 2048 or

2.86. I don't know whatever. Guys, final edition. First and final edition of Daybreak Unwind. It was great to know you all. Just joking. This is judgment-free zone. It is so bad.

Oh my God. It's so unoriginal. Like, I can't believe that they spend so much money on it. It's basically this post-apocalyptic story, right, that is loosely based on Mahabharat. And it's about the coming of the Kalkya Vatar, which, you know, in Hindu mythology, is like supposed to be the final reincarnation of Vishnu.

So it happens, it's supposed to happen during the end of the Kali-Yug, which is the darkest yug, right? So when sin reaches its peak, you know, Kalkyavitar comes or whatever. And there was so much potential. The thing is, I love Mahabharata as. a story. It's such an amazing story. They could have done so much. There was so much potential. But yeah, it's just movie turned out to be like this mishmash of like if you've grown up

watching sci-fi fantasy, you will like see so many things that you've seen before. Basically it's like, you know, this whole mishmash of like Matrix, Star Wars, Lord of the Rings, Mandalorian. Oh, wow. All of that put together. It's like, you know, they fed all these movies and they said, like, put Mahabharat in it and like asked AI. Yeah, exactly. Asked AI to generate it.

That's the movie. You know, even Prabhas. Prabhas is good, right? Prabhas is good. But they made him look so comical and like, you know, I don't know. He's supposed to be Karin in this movie, like the character of Karin he plays. But yeah, they made him look like so funny. And then, but I have to say, see, Amita Bacchan, not a big fan.

I'm sorry for those people who love Amitab Bacchan. I agree, he's iconic, but I am not a big fan. But in this movie, I have to say that I think he was probably like the best part. They made him look really good. Okay. And also he did a good job. Oh, okay. Yeah.

So would you recommend watching? I recommend hate watching this movie. But also, it's very interesting to see how, um, you know, like how we copy paste the West, we've always been doing it, like with mainstream cinema. But like how when AI and CGI and all of that comes into the picture, what do we do then?

Yeah. You know, how we copy paste then. So that is interesting to watch. So yeah. Yeah, there's like a very quintessential kind of sci-fi template that a lot of people are now just by default copy pasting and it's just, yeah. True.

Okay, I'll be hate watching. Kalki very soon. It's on Netflix. Not sponsored. Yes, not sponsored. Okay, that's it. Okay, I think Daybreak Unwind, episode one was a success,

in my opinion. But you can let us know what you think, how you think the segment can be better, and yeah, we would love to hear from you, we would love to hear your recommendations. You can write to us, send us a voice note, reach out to us on WhatsApp, our number is 89711-08379.

We'll also put it in the show notes of this episode. I'll repeat it one more time because I said I would. The number is 89711-08379. Siddha, you should do the phone-pay machine one day will be. Oh my God, that's Amita Batchez. Right? Devi-o or Sajan-o. Anyway.

$30. And that note, $30. Bage dee na WhatsApp. That'd be great. I'm kidding. I'm kidding. All right. That's about it.

Thank you for tuning in. Bye. Daybreak is produced from the newsroom of the Ken, India's first subscriber-focused business news platform. What you're listening to is just a small sample of our subscriber-only offerings. A full subscription unlocks daily long-form feature stories, newsletters, subscriber-only apps, and podcast extras.

Head to the ken.com and click on the red subscribe button on the top of the website. I am Snigda Sharma, your host and today's episode was edited by my colleague Rajiv Sien.