Title

Exchange and Refund of Complementary Products

Publication Type

Journal Article

Publication Date

10-2015

Abstract

A common dilemma a consumer faces during product return pertains to the decision of exchanging the product or obtaining a refund. This issue becomes even more salient for durable goods, when the initial purchase involves complementary products from different categories. This research examines consumer’s trade-off decision between returning and keeping complementary products by exploring various retail actions (using umbrella branded products (UBP)) and customer characteristics. We also investigate the trade-off between product exchange and refund when consumer returns a product. We find interesting extensions to past research wherein UBP are returned less and result in greater exchange than refund. Furthermore, an interesting caveat is that higher degree of complementarity between UBP intensifies the impact of various factors on exchange as opposed to refund of products. Implications for retail managers and sales teams are explored.

Keywords

Product return, Product exchange and refund, Umbrella branding, Nested logit, Multinomial logit

Discipline

Management Sciences and Quantitative Methods | Marketing | Sales and Merchandising

Research Areas

Marketing

Publication

Marketing Letters

ISSN

0923-0645

Identifier

10.1007/s11002-015-9393-7

Publisher

Springer Verlag (Germany)

Additional URL

http://dx.doi.org/10.1007/s11002-015-9393-7

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