Retailers beware: On denied product returns and consumer behavior

The wide variety of retailer return policies can cause consumers confusion. While keeping costs contained, very restrictive Return Policies (RPs) may mar consumer behavior. As a first attempt to examine the impact expectation of return control and involvement have on consumers, this study builds a conceptual model with support of the theory of psychological reactance and lends insights into how and why RPs, specifically the denial of product returns, affect consumers during and after the product return process. Our findings indicate that when consumers have high expectations of successfully returning a product and are denied, RPs create significantly higher negative attitudes toward the retailer and attempts to regain control both directly by asking the retailer for an exception and indirectly by retaliating against the retailer in the form of future fraudulent returning. Return-encounter tensions may be lessened by making consumers aware, before purchase, of the RPs.