Should e-returns services be “one-size-fits-all” for consumers? Segmentation using return policy promises and constraints

Purpose This study aims (1) to identify which benefit and cost dimensions of an e-tailer’s return policy promises and constraints are perceived as important for superior return service delivery and (2) to determine different consumer segments based on the perceived importance of these benefit and cost dimensions. Design/methodology/approach We conducted two sub-studies in India, using a mixed-method design in India for this study. In Study I, we interviewed 23 consumers to gain insights into the benefits and costs of return policies. In Study II, we surveyed 257 consumers to determine the relative importance of these benefits and costs through a direct ranking survey and rank-order logit modeling. Our findings revealed three distinct consumer segments based on their perceptions of ranking benefit and cost dimensions. Findings Study I suggested five benefits (owning up to mistakes, customer-friendly refund/replacement, access to support, responsiveness and reliability, site ease and one cost (return investments)). Study II determined three consumer segments (inconvenience haters, rapid reliable response cravers and refund worriers). Research limitations/implications This research empirically disproves the proposition that consumers are homogenous in their perception of value (i.e. benefits and costs) regarding return policy promises and constraints and identifies three consumer segments based on the differential perceived importance of benefit and cost dimensions of return policies. Practical implications The study suggests that e-tailers aiming for superior e-return service delivery should focus on excellent performance with respect to cost and benefit dimensions that different customer segments find most important. Originality/value A new research segmentation scheme is suggested based on return policy promises.