In the ever-evolving world of e-commerce, where clicks have replaced storefronts and shopping carts, a hidden challenge lies in this thriving industry. Consider this: nearly one-third of online sales are returned, triggering a relentless cycle of shipping items back and forth, all in the name of fit and sizing. Returns, once seen as a routine part of post-purchase proceedings, now demand our full attention. So, let's call it what it is: E-commerce has a sizing problem.
So how big is the e-commerce sizing problem really?
Sizing eventually cuts into three bottom lines that can be remembered as the 3 E’s:
The first and third ones quite significantly affect brands directly, while the second one is only slowly starting to gain attention. On average, returns cost brands ~20% of an item’s sales price. In Germany, the market with the highest return rates cost fashion e-commerce €1 billion in 2021.
More than 50 million packages were sent back and forth between consumers and warehouses, causing 41.000 t CO2 emissions. To offset that, 41 million trees would have to be planted. In addition to that, the unsold items stemming from returns that end up in landfills or are being destroyed/burnt are not even quantified in this calculation yet.
With 50% of returns in fashion e-commerce being attributed to sizing & fit issues, it would appear to be the obvious choice to tackle this issue first. And so have a handful of players in the market attempted to solve e-commerce’s sizing problem over the past couple of years.
The one problem: so far, they have also only treated it as an e-commerce problem, therefore offering only e-commerce solutions, that gamify the shopping process and increase conversions at best, but without a significant success in reducing returns (the numbers speak for themselves).
This ultimately implies, that there is a structural problem underneath the surface that needs to be addressed first: the actual products.
As long as fashion garments are physical items, fashion e-commerce needs to maintain a tie from the digital to the analogue world.
Therefore, the only way to sustainably solve the e-commerce sizing problem is by looking at the actual underlying fashion products throughout the entire product development cycle: from design to grading, pattern making, production and quality assurance. That is where the e-commerce sizing problem ultimately starts, and where it needs to be solved as well.
We have made it our mission to reduce returns from sizing once and for all, tackling the 50% that are the number one reason for returns.
How? Shopper biometrics, actual garment specifications & product processes are digitalized and computed.
Advanced AI and Computer Vision make it possible to create digital twins of both shoppers and garments and match them. Shoppers are recommended the perfect size every time they shop on a SAIZ-powered store. Brands are provided with advanced insights, all based on knowing what their customer base looks like. This enables them to optimize their products for their actual customers (not just the ideal customer and a certain fit model that wears XS or S) starting in the design process, and only produce what is actually needed (no more arbitrary size split orders for bulk production).
Solving the e-commerce sizing problem is only the first step towards what is going to be followed by endless opportunities.
If we reduce return rates by 10% in the market, we save an equivalent of 400.000 t of CO2 of purely logistics pollution, we save brands 1Bil. EUR overall and hopefully also change the ways of producing: with more fitted, less wasted materials.
Join us in our quest, to shop better and produce smarter.
