Microsoft has made this really easier with only few steps. To reset your Nokia Lumia 720 to default settings follow the below steps.
At first, slide left or tap the Arrow icon to highlight Windows phone 8 Start Screen.
Next Tap “Settings” and then choose “About” option.
Go to the bottom of the page and tap to “reset your phone” option.
Now you will prompt confirmation pop-up in order to continue resetting action or not.
Tap to yes option.
As the result, your windows phone 8 will be reset to default factory settings.
You must ensure that entire content will be removed when you reset the settings. Then you have no chance to recover anything.