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Increasing customer purchase intention through product return policies: The pivotal impacts of retailer brand familiarity and product categories

Shih-Ping Jeng

Journal of Retailing and Consumer Services, 2017, vol. 39, issue C, 182-189

Abstract: This study gauges customer perspectives to investigate how return policy generosity (the degree to which a retailer imposes minimal restrictions on returns) influences customer-perceived value and customer purchase intention. It also examines two moderators, retailer brand familiarity (the extent to which the retailer brand is well-known) and product categories (the difference between products with respect to the magnitude of effort required to make a return). An experiment with a 2 × 2 × 2 factorial design was conducted. The results show that return policy generosity increases customer purchase intention by enhancing the perceived value of the policy. Lesser-known retailers benefit more from generous return policies than their well-known competitors, particularly when a product requires significant return effort. Well-known retailers benefit from offering generous return policies only for product categories that involve low levels of return effort. The findings of this study suggest that if a retailer formulates a return policy without considering the moderating effects of retailer brand familiarity and product category, then it will tend to over-invest if the return policy is generous.

Keywords: Return policy; Value; Customer purchase; Retailer brand familiarity; Product categories (search for similar items in EconPapers)
Date: 2017
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Handle: RePEc:eee:joreco:v:39:y:2017:i:c:p:182-189