With “Return Bars” and “Returnistas”, Happy Returns is eliminating the hassle of returning online orders by mail.

LOS ANGELES — With Happy Returns, the allusions to Apple are apparent from the start. For one, their return locations are called “Happy Bars”. The folks who work at these locations are called “Returnistas”. Even setting these familiar-feeling names aside for a moment, the fact that they even branded their customer service locations at all is a move that Apple has made famous.

Co-founders David Sobie and Mark Geller are both hoping the comparisons to Apple go beyond just names, and eventually apply to business as well. For that to happen, the company will have to overcome some very real challenges.

Happy Returns, based in Los Angeles, is a new upstart that’s addressing a need in era where e-commerce continues to grow its already massive reach by the quarter. For participating brands and retailers, they offer a service that allows customers to be able to quickly and efficiently return and refund items bought online. Rather than shipping returns by mail, customers are able to drop their purchases off at a Happy Bar, and Happy Returns handles the rest.

Co-founders David Sobie and Mark Geller are both hoping the comparisons to Apple go beyond just names, and eventually apply to business as well. For that to happen, the company will have to overcome some very real challenges.

It’s a smart concept, no doubt about that. And it certainly has use. But the existential question looming over the company — and whether it can become as big of a service as its investors, Trunk Club’s Brian Spaly among them, hope it will be — is if the problem it’s solving (giving customers a physical place to return their online purchases) is as big of an issue for people as the Happy Returns team believes it is.

On that note, Lean Luxe spoke to David Sobie to learn more about the business. Below, the highlights from that conversation:

The concept. Sobie explained that Happy Returns has built national network of physical return locations across the US. As mentioned earlier, online shoppers from participating retailers can bring items to be returned in person, eliminating the hassle and wait of return-by-mail. It’s a simple, seamless process the way Sobie described it: Shoppers bring the item to the Happy Bar, and the “Returnista” takes care of the rest. Sounds easy enough.

The process. Extremely consumer-friendly. The Returnista uses Happy Return’s iOS app which is connected to the backend of the participating retailer. Using their email address, the Returnista can pull up the customer’s previous orders from the retailer in question. The app then guides the Returnista in handling the return, verifying that the item can indeed be returned, and doing a basic quality check.

Total locations: 23. And they’re expanded rapidly. Sobie said that they’d gone from nine locations in May to nineteen locations by the end of June. There’s a mix of owned and operated locations and shared locations, whereby Happy Returns has an installation in an existing store or mall.

Currently, they have one owned and operated location in LA, with a second to come in NYC later this year. The rest are in malls or pre-existing stores. If it’s a mall (they have partnerships with major mall developers Simon Property Group, Macerich, Westfield, and Taubman), it’s typically at the guest services desk. There, Happy Returns trains the guest services team in how to process returns using the Happy Returns app, and it’s the same process for individual stores and boutiques.

On saving brands money. Sobie emphasized two talking points here. First, there are less calls made to customer service centers about returns and refunds since Happy Returns handles that on the spot. Second, by batching return shipments for brands, the company helps them avoid big fees from shipping each item individually.

Where Happy Returns can win: Second- and third-tier cities. The strategy so far, said Sobie, is to grow by breadth (new cities) and depth (more locations in a given city). LA is an example of this, he said. There they currently have three locations and plan to have over ten locations in the city by the end of the year. “We’re recognizing that people don’t want to travel far for returns,” he explained, so they’re aiming to cluster multiple locations in major cities to make things more convenient. In LA, he said, that means going neighborhood by neighborhood.

Our Perspective: Two big questions for Happy Returns.

  • WWD recently reported of a similar service in Hong Kong, where brands are partnering with convenience stores for returns. Sobie is championing a more integrated, higher-touch service, but there’s still the threat of customers just going with the return service that’s closest to them. Happy Returns’ Return Bars are located in larger stores and in malls. Your local 7/11 or bodega is a two minute walk around the block. Even if the return process is perhaps less integrated at your bodega, it’s a risky bet to assume that Happy Returns’ more convenient service is enough to outweigh its inconvenience of location (right now at least) for customers.
  • Is return-by-mail as much of a hassle as Sobie and co-founder Mark Geller believe? To be sure, Sobie made quite the case for in-person returns versus mail. Still, we are a tad skeptical that customers are crying out for an in-store returns solution as much as he believes. That also goes for the brands themselves, which, to emphasize, is Happy Returns’ primary customer set. Sobie admitted that some brands are skeptical that returns-by-mail are as annoying for shoppers as Happy Returns argues, which could prove to be a significant barrier for Happy Returns in bringing on more retailers.
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