New insights in online fashion retail returns from a customers’ perspective and their dynamics

Abstract

Returns are an inconvenient problem in the mail-order business, not only for the merchant but also for the customer. With an estimated return rate of 50% in the fashion sector, the seller has to deal with the expense of restocking and possibly reprocessing, the buyer, who must reship the return, and the environment. We do not consider returns to be generally bad, but rather an explicit, integral part of the online business model. Therefore, we investigate potentially suitable measures to avert or avoid returns in the pre-purchase, purchase, and post-purchase phases. We look at current and technological developments in return management and the most critical drivers for fashion assortment returns. The measures we investigate deliver a holistic view of the issue and target all three purchase phases. The resulting measures were assessed via an online questionnaire with 8393 participants (customers of a German fashion online retailer) to impact customer satisfaction using Kano’s method. There are clear measures that promise high customer satisfaction (such as 360° view) and a clear hierarchy regarding monetary and non-monetary measures. By applying a new method, the segmented Kano perspective, we found different customer segments, which are different in their expectations towards returns. That allowed us to conclude dynamics regarding return management. This assessment is followed by discussing the results, conclusions, and indications for further research fields.

On merchandise return policy, entrepreneurial internet retail, and customer reviews – Insights from an observational study

“…This logic transfers to the assessment of the value of a perk; it is unlikely that the size or amount of the perk is linearly related to the increase of the customer's sense of appreciation and, in turn, is related to the likelihood of writing a review. This is consistent with the law of diminishing marginal utility, which argues that the marginal utility of each unit decreases as its number of units increases (Baek et al, 2012), and even with the literature on MRPs, specifically which has argued that the value seen by buyers in increasingly lenient MRPs increases at a marginally decreasing rate (Rao et al, 2018;Stöcker et al, 2021). Alternatively, simply put, the value of a 90-day returns time window, on average, will not be twice as valuable to customers as the value of a 45-day return time window.…”

“…Moreover, it provides additional nuances to understanding the returns management process in online shopping, an area for which additional research has been called (Boyer et al, 2002;Griffis, Rao, Goldsby, & Niranjan, 2012;Griffis, Rao, Goldsby, Voorhees, & Iyengar, 2012). It also supports the need to include the online review (eWOM) as an integral part of the returns (and purchase) process, extending the current view of returns (Stöcker et al, 2021) and, more broadly, of online retail in the LSCM literature (e.g., Esper et al, 2020;Wallenburg et al, 2021). Our work, therefore, underscores the necessary integration between LSCM and marketing and, more broadly, between demand and supply.…”

Exploring the role of augmented reality in online impulse behaviour

“…Lastly, while retailers face huge challenges in reducing the online product return rate, 50% of the apparel purchased online is returned globally (St€ ocker et al, 2021). This study demonstrates how AR reduces product risk through spatial presence.…”

“…Lastly, while retailers face huge challenges in reducing the online product return rate, 50% of the apparel purchased online is returned globally (Stöcker et al. , 2021).…”

Does the combination of sustainable business model patterns lead to truly sustainable business models? Critical analysis of existing frameworks and extensions

“…The sources of uncertainty in the value adding network can also be related to the difficulties in predicting customers' demand, which is related to customer's consumption behavior, e.g., in online fashion retail (Stöcker et al 2021), customers' characteristics such as consumer's age (Falke et al 2021), or patience, e.g., in the adoption of electric vehicles (Chu et al 2021), or it can be defined with reference to technological change and short technological lifecycles. At least from an operational perspective, stable customer demand leads to cost-efficient and optimized processes, favorizing lean management procedures.…”