Refunds, Right Now. Reshop Targets Gen Z and Millennial Shopping Pain Points

Anthony Eisen is no stranger to shaking up the financial landscape. As the co-founder of Afterpay, he helped transform the buy now, pay later (BNPL) sector, giving consumers a more flexible way to shop without the immediate burden of full payment. Now, he’s turning his attention to another facet of the retail experience that has long been overlooked: the refund process.

But he has a particular focus on the shopping and payment habits of Generation Z and millennial consumers, who make most of their purchases using their debit cards. The Reshop thesis is that instant refunds to those debit cards increases the odds that those consumers will buy again from that retailer, or another one that is part of the Reshop network.

Eisen was recently appointed CEO of Reshop, a startup focused on elevating the consumer experience around returns and refunds in eCommerce.

“Twenty percent of everything gets returned in America,” Eisen told PYMNTS CEO Karen Webster. “I’m really excited about the opportunity to get super close with millions of consumers in terms of understanding preferences and payments online. The return space has always stood out in such an obvious way about being the last white space of eCommerce that sort of had a lack of innovation around it.”

With $17 million in new funding, Reshop is primed to make waves in a sector that sees over $600 billion in returns annually in the U.S. alone. This issue has been amplified by the rise of online shopping, where the complexities and frustrations around returns have made it a major pain point for both shoppers and retailers.

Instant Refunds, Real-Time Impact

Traditional refund processes can take days or even weeks, creating unnecessary anxiety for consumers. Launched last year, Reshop allows shoppers to receive instant refunds when returning items to participating retail partners, which can then be automatically used with a virtual Reshop card for purchases online at any store that accepts Visa debit cards.

As Eisen told Webster, Reshop is designed to appeal to millennial and Gen Z consumers, particularly those who use debit cards for online purchases, by addressing their anxieties surrounding returns.

“The returns policy of an online retailer is the number one reason why a shopper will decide, particularly if you’re a millennial and younger, to go ahead and make a purchase,” Eisen said. Reshop aims to alleviate this anxiety by offering instant refunds, which is particularly appealing to debit card users who want to manage their cash flow and avoid debt. It also eliminates a major friction point in eCommerce for these demographics.

“For customers, the value proposition is a no brainer, which is: ‘Give me my money now,’” Eisen said. “We’re not talking about once they’ve gone to the post office or once they’ve returned into store. It’s literally when a consumer is looking at their package that’s arrived and it’s next to them and, for whatever reason, it’s the wrong thing. The ability to work with merchants to not only make their customers money good in that moment instantly, but it’s a point where the brand is in full focus, their shopping is in full focus, and the ability to recapture that customer because their money is good in that moment.”

The Strain of Returns on Retailers

Returns are a logistical nightmare for merchants, Eisen noted, often leading to losses, stock delays and the risk of fraud. Eisen recognized these challenges and has designed Reshop to address them head-on.

“Returns are awful experiences for retailers,” Eisen said. “They lose money. It takes a long time for stock to get back on the shelves. There’s a lot of fraud. Merchants aren’t generally equipped to deal with fraud themselves. The number one reason why customers will ring a customer service center at a retailer is to ask where’s their return and where’s their money.”

Data-Driven Approach to Overhauling Returns

Eisen’s approach, informed by his experience with Afterpay, is built on data-driven insights and technology. Just like BNPL changed the way consumers shop, Reshop can reshape the returns experience.

“If you look at that $600 billion of online returns per year, another way to think about that is all that money is just lost in the system,” he said. “It’s not benefiting the consumer, and it’s not benefiting the retailer. The fact we can unlock that instantly means that the retailer has an opportunity to have more sales in a period because you’re bringing the whole timeline forward, but more importantly, you’re also capturing the consumer in the moment, and then you are taking the anxiety away.”

Eisen believes Reshop’s model, which also addressed fraud and poor-performing consumers, can truly impact how brands interact with consumers once a transaction has been completed. Instead of focusing on front-end marketing and customer acquisition, Reshop encourages retailers to nurture and enhance customer loyalty throughout the entire buying cycle.

“The important point about Reshop is it works with exactly the policy of that individual retailer in terms of returns, what’s eligible for returns, what’s not eligible for returns,” Eisen said. “It’s about making the money good when they’re looking at your brand. But when we give consumers their money, particularly on the card in the Reshop app, we can immediately feature items according to their preferences from the retailer they just shopped from.”

Eisen said that the appeal of Reshop’s solution is that it extends the logistics of returns.

“I haven’t met anybody, regardless of where they sit from a socioeconomic point of view, that doesn’t have anxiety about their returns,” he said.

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