PayPal is making its Happy Returns returns programme free for PayPal Checkout merchants. On Monday, PayPal announced that retailers can now utilise the Happy Returns return and exchange gateway software for free, and that it has worked with Ulta Beauty to install Return Bars in over 1,300 Ulta stores nationwide.
The Ulta Beauty expansion will start with a few stores and grow throughout the year.
This is PayPal’s first major endeavour with Happy Returns after purchasing the software and logistics service in 2021.
Since then, the number of Return Bar locations has nearly doubled, from 2,600 to over 5,000 with Ulta Beauty. 78 percent of Americans currently live within a 10-mile radius of one of these Return Bars, according to PayPal.
Customers do not need to go to a separate website to return items. To return an item, the customer must first visit the retailer’s website. If the merchant supports it, they will receive a QR code to bring with their goods to their nearest Return Bar outlet. They don’t need to box or label the merchandise. Customers get an instant refund by scanning their QR code. The item is then put in a reusable tote with other returns there. PayPal notes that by picking up this container, fewer shipping are required.
Happy Returns retail partners will inform customers about the programme at the store entrance and at the checkout. They also get a coupon from the location’s retail partner to make a purchase while they’re there. It works like Amazon returns at its own retail partners like Kohl’s.
The service has grown in popularity over the last year as online purchasing has grown. In February 2022, PayPal reports in-person returns at Happy Returns Bars were nearly four times higher than in February 2021. Among the new retailers are Everlane, Rothys, Gym Shark, Mack Weldon and others. Customer service representatives from Ulta Beauty and other participating retailers will assist customers in returning items.
Happy Returns is now free for PayPal sellers, however PayPal Checkout fees still apply. Alternatively, merchants can utilise the software and interface to manage returns and exchanges without using the Return Bars network. PayPal says the software helps automate returns and exchanges and gives merchants a dashboard where they can view detailed returns statistics and respond to consumer concerns in real time.
Those that support Return Bars will pay additional costs that PayPal won’t reveal. Customers will save money through combined returns shipping and cheaper carrier rates.
“While consumers are increasingly purchasing online, returns are still a ‘in person’ experience, which is costly and difficult for merchants,” said David Sobie, vice president of Happy Returns by PayPal. Thanks to Ulta Beauty, we now have more choices for online shoppers to return items—Return Bars bring new customers into stores and help retailers manage reverse logistics more efficiently.
PayPal didn’t say how much it spent for Happy Returns, but it was one of four purchases totaling $542 million in 2021. PayPal has already invested in the company, which PitchBook valued at $55 million after its 2019 B round.
In order to compete with e-commerce behemoths like Amazon and Walmart, Happy Returns offers a solution that allows smaller merchants to compete with larger retailers like Whole Foods and Walmart. Because of the potential foot traffic, shops like Kohl’s and Stein Mart have embraced the enemy by enabling Amazon returns in-store.
Ulta, which has previously tested the Happy Returns programme, said it was “encouraged” by the increased traffic and in-store engagement.
