Root causeHard35 minE-commerce

Returns are climbing

A root cause analysis question from a product manager interview, set at StyleBazaar, a fictional fashion e-commerce company.

The question

You're a PM at StyleBazaar, a fashion marketplace in India. Over the last 6 weeks, our return rate has gone up from 18% to 24%. Find out why, and what we should do about it.

Skills this case tests

Second-order effectsExperiment designUnit economics

A starting metric tree

Return rate = delivered orders returned ÷ delivered orders, by delivery week

How to approach this case

Clarify how returns are counted: by delivery week or return week, whether orders refused at the door are included, and how long the return window is, because returns arrive days after the order. Compare with the same weeks last year to strip out any seasonal bump before you explain the rest. Then break the rise down two ways, by category and by return reason: 'size doesn't fit' and 'quality not as expected' point to very different problems and owners. Look at what else moved in the same weeks, including orders, conversion and average selling price, before deciding where the problem sits. A strong close does the unit economics (margin on a kept order versus the cost of each return), proposes a fix that still serves the business goal, and names a metric you would add as a guardrail on future launches.

The full method for root cause analysis questions · A worked example answer

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