Amazon, Walmart using AI to decide on economic sense to process a return

Retailers have a new message for consumers looking to return an item: Keep it.

Ticker Security Last Change Change %
WMT WALMART INC. 121.62 -0.18 -0.15%
AMZN AMAZON.COM INC. 106.21 -2.71 -2.49%
UPS UNITED PARCEL SERVICE INC. 182.50 +1.39 +0.77%
TGT TARGET CORP. 141.30 -0.57 -0.41%

Amazon.com Inc., Walmart Inc. and other companies are using artificial intelligence to decide whether it makes economic sense to process a return. For inexpensive items or large ones that would incur hefty shipping fees, it is often cheaper to refund the purchase price and let customers keep the products.

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The relatively new approach, popularized by Amazon and a few other chains, is being adopted more broadly during the Covid-19 pandemic, as a surge in online shopping forces companies to rethink how they handle returns. “We are getting so many inquiries about this that you will see it take off in coming months,” said Amit Sharma, chief executive of Narvar Inc., which processes returns for retailers.

Retailers, such as Walmart, Amazon and Target, have a new message for consumers looking to return an item: Keep it. (Photo by Noam Galai/Getty Images)

Lorie Anderson of Vancouver, Wash., was pleasantly surprised when she tried to return online purchases of makeup at Target and batteries from Walmart. The chains issued her a refund but told her to keep the items. “They were inexpensive, and it wouldn’t make much financial sense to return them by mail,” Ms. Anderson, 38 years old, said. “It’s a hassle to pack up the box and drop it at the post office or UPS. This was one less thing I had to worry about.”

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A Target Corp. spokeswoman said the retailer gives customers refunds and encourages them to donate or keep the item in a small number of cases in which the company deems that option is easier than returning the purchase.

Click for more at WSJ.com