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A systematic review of e-tail Review of e-tail

product
product returns and an agenda for returns

future research
Kamrul Ahsan and Shams Rahman 137
Department of Supply Chain and Logistics, RMIT University, Melbourne, Australia
Received 22 May 2021
Revised 28 August 2021
Abstract Accepted 19 September 2021
Purpose – This study conducts a systematic literature review of e-tail product returns research. E-tail product
returns are essentially acquisition of products that have been sold through purely online or brick-and-click
channels and then returned by consumer to business.
Design/methodology/approach – Using a systematic literature review protocol, we identified 75 peer-
reviewed articles on e-tail product returns, conducted bibliometric analysis and content analysis of the articles
and summarised our findings.
Findings – The findings reveal that the subject of e-tail returns is a new research area; academics have started
to investigate several aspects of e-tail returns through different research methodologies and theoretical
foundations. Further research is required in leading e-commerce countries and on key areas such as omni-
channel returns management, customer satisfaction and service, the impact of resources such as people skills,
the benefits of technology and IT systems in managing e-tail returns.
Practical implications – The study offers a summative account of current e-tail knowledge areas, which can
serve as a reference guide for e-tailers to develop strategies for more efficient and competitive product returns.
Originality/value – This study contributes theoretically by developing clusters of key themes or knowledge
areas about e-tail returns. It also provides a conceptual framework for e-tail returns management, which can be
used as a springboard for further empirical research.
Keywords E-tailer, Literature review, Product returns, Returns management
Paper type Research paper

1. Introduction
Global e-commerce trading volume is increasing each year as more and more people opt for
the convenience of online shopping. In 2015, the global e-commerce trade volume was
US$1.67 trillion (7.4% of overall global retail sales); in 2019, this had risen to US$3.53 trillion
(14% of overall global retail sale), representing an average trade volume growth of 22% per
annum (Statista, 2019). This growth has been fuelled by increasing sales through online
channels as well as the continuous entry of bricks-and-mortar retailers into e-commerce.
COVID-19 provided additional impetus to the upsurge of e-commerce in total retail sales. For
example, if one compares the online sales growth of 2018 with 2020, the US market rose from
11.8% to 16.8%, the United Kingdom (UK) rose from 20.3% to 31.3% while China rose from
17.3% to 24.6% (OECD, 2020). This growth is expected to continue beyond 2020, forecasted to
reach US$6.54 trillion by 2022 (Statista, 2019).
This growth of e-commerce has been accompanied by a similar rise in product returns from
the consumer to the e-tailer. The proportion of product returns to total sales is higher in
e-commerce than in traditional brick-and-mortar stores. In 2018, 30% of all products ordered
online were returned, compared with 8.89% returns in brick-and-mortar stores (Invesp, 2019).
Further, product returns for online purchases are not restricted to any specific country but are a
global phenomenon. For example, in 2019, the returns to total online sales ratio in the United
States was 9.7% (total sales US$427 billion) while in the UK it was 33% (total sales US$79 billion)
Industrial Management & Data
(Statista, 2019). In Australia, this ratio was 19% (total sales US$20.3 billion) (AusPost, 2019). Systems
With the growth of product returns, the management of product returns is becoming a Vol. 122 No. 1, 2022
pp. 137-166
critical challenge for online retailers, commonly known as e-tailers. Despite the high return © Emerald Publishing Limited
0263-5577
rate for online purchases, e-tailers have not yet succeeded in effectively managing product DOI 10.1108/IMDS-05-2021-0312
IMDS returns to win and retain their customers (CNBC, 2019). A KPMG survey from 2017 suggests
122,1 that over 14% of online shoppers are unhappy with the process for returning e-commerce
goods and consequently prefer to shop in brick-and-mortar stores (KPMG, 2017). According
to a worldwide survey by Statista on online shoppers, the main reasons for e-tail returns were
identified as (1) faulty, poor quality or damaged goods, (2) late delivery, (3) inaccurate
description of products online and (4) change of mind returns (Statista, 2019). Further, the
e-tail environment allows unhappy consumers to readily communicate their dissatisfaction
138 with unresolved product returns through social media. This negative word-of-mouth can be
very damaging for e-tailers (Sahoo et al., 2018).
There is currently scant literature review studies on omni-channel management (Cai and
Lo, 2020), product recalls (Wowak and Boone, 2015) and returns management policy and
customer behaviour (Abdulla et al., 2019). To our knowledge, no study has been undertaken
on e-tail returns or e-commerce purchase returns. Given the importance of e-tail product
returns, a systematic literature review can provide a useful synthesis of research in this
rapidly growing field. Further, exploration of core aspects of e-tail product returns is essential
because, if managed well, an efficient returns management system can contribute to customer
retention, thereby thus improving the e-tailers’ bottom line. Hence, the importance of a
comprehensive review of e-tail product returns articles remains. To guide the literature
review, the following research questions have been formulated:
(1) What are the recent trends in e-tail returns research?
(2) What are the core knowledge areas or themes in e-tail returns research?
(3) What are the gaps in e-tail returns research?
The scope of this systematic literature review is to focus on articles on consumer-to-business
product returns from e-commerce or e-tail returns. The rest of the paper is organised as
follows. Section 2 presents the literature review of e-tail returns management. Section 3
discusses the research methodology while Section 4 provides an analysis and descriptive
analysis of articles on e-tail returns. Section 5 provides an overview of the e-tail returns
knowledge areas for value creation as well as discussing research gaps. It also outlines future
research directions and summarises the study implications. Section 6 concludes the study.

2. Literature review
2.1 Overview of product returns
Products are mostly returned because of buyer regret or product defects, these returns are
typically “pushed” from the downstream consumer back to upstream of the supply chain, towards
the retailer or e-tailer (Rogers et al., 2002; Mollenkopf et al., 2011). This backward flow of products
typically goes from customer-to-business, sometimes continuing further backward, from business-
to-business. Customer-to-business returns are routine for e-tailers, and these returns are directly
from unhappy consumers (Collier, 2006). Business-to-business interactions mainly deal with
damaged or defective returns, incorrect shipments, overstocking, repositioning of product
inventory, business close-outs or buy-outs and marketing returns (Rogers et al., 2002). The focus of
this study is on the unexplored area of customer-to-business returns that stem mainly from e-tail
sales. Returns generated such as mail-order sales (Wood, 2001) were not included. Other issues
related to customer-to-business returns include remanufacturing, recycling or landfill; there was
considerable number of review articles conducted on these areas, hence these areas fall outside the
scope of this research.
2.2 E-commerce and product returns
The OECD defines e-commerce as the ordering of goods and services over the Internet
while payment and delivery of goods and services can be conducted either online or offline
(OECD, 2011). Online retailing (e-tailing) is a subset of e-commerce and refers to the purchase Review of e-tail
of goods by the consumer from the retailer using the Internet (APC, 2011). There are two product
broad types of e-tailers: purely online businesses (such as eBay or Alibaba) and “brick-and-
click” businesses, which are an extension of traditional brick-and-mortar retailers.
returns
In e-commerce, e-tailers provide visual product information online. Consumers visit
e-tailer websites, read product, delivery and returns information, and then try to match their
requirements before making a purchasing decision. One of the disadvantages of online
purchases is that in most cases, buyers are unable to physically inspect goods prior to 139
purchase or the online description of goods does not match the actual product (Bonifield et al.,
2010). Moreover, between the purchase and receipt of a product, there are numerous logistics
and product-related risks (such as improper billing, wrong product delivery, incorrect
quantity or volume or product damage during transport). These could result in customer
dissatisfaction and may influence consumers to return products (Hjort et al., 2019).
There are distinct differences between managing product returns in an e-tail environment
and a brick-and-mortar environment. E-tail product returns differ in terms of the returns
process, reverse logistics activities, customer efforts required to return a product and the type
of communication between the e-tailer and customer. Moreover, e-tail product returns can be
more challenging in omni-channel returns environment. In omni-channel, retailers facilitate
order fulfilment and product returns through different combinations of channels to provide a
seamless experience to the customer. Thus, customer orders (pure online and brick-and-click)
are fulfilled through home delivery, non-store pickup or store pickup. Consequently, product
returns also occur through returns channel either store or non-store. These include “buy-
online-return-to-store” (BORS) or “buy-online-return-to-non-store” (BORNS). BORS involves
returning the product to the nearest store or any chain store. BORNS requires the customer to
work with the e-tailer to organise returns authorisation and then return the product to a local
drop-off or parcel point. Alternately, the e-tailer organises a courier or the customer returns
the product via a local post office. In both BORS and BORNS, product condition and quality
need to be assessed before further processing can take place, namely, restocking, repair or
disposition. Consumers may prefer either one of these options depending on many factors,
namely, the cost of the return fee, proximity to local stores and convenience of the specific
return process. For e-tailers, managing supply chain and logistics services related to BORS
and BORNS are the backbones of returns management. Consequently, e-tail returns are
regarded as a strategic component of business operations since they are associated with a
high cost. This has become increasingly evident as return volumes steadily rise (Hjort
et al., 2019).
Existing systematic literature review on recent developments on e-tail returns research is
rare. Our search suggests that there have been only a few review studies on product returns in
general. Janakiraman et al. (2016) conducted meta-analytic review on 21 articles focusing only
on returns policy leniency dimensions on consumer purchase and return decisions for
product returns. Recently, Abdulla et al. (2019) conducted another literature review research
which is confined to returns management policy and customer behaviour for product returns.
Both the research lack focus on a comprehensive review of e-tail returns. As e-commerce is
growing, the volume of product returns is increasing, however, a comprehensive review of
e-tail returns is missing. Hence, we conduct a systematic literature review on e-tail returns
articles, where it is critical to explore overarching views of e-tail consumer returns
knowledge areas.

3. Research methodology
This study conducts a systematic review of literature on e-tail product returns. A systematic
literature review is an explicit and reproducible methodology that locates an existing body of
scattered knowledge, selects and evaluates contributions, analyses and synthesis data, and
IMDS then records and reports the evidence, arriving at clear conclusions about what is known and
122,1 what is still unknown (Denyer and Tranfield, 2009; Tranfield et al., 2003). A systematic
literature review is conducted through content analysis, which requires the development of a
coding framework to categorise information according to emergent clusters of themes
(Schilling, 2006). An analysis is then performed to convert the raw data into a meaningful
format (Denyer and Tranfield, 2009).
For content analysis of e-tail returns literature, we conducted a bibliometric analysis and
140 identified research trends and future research directions. Bibliometric analysis is a scientific
computer-assisted review methodology that offers the advantage of analysing large
databases quantitatively and maps how specific disciplines or research fields are
conceptually, intellectually and socially structured and related to a given topic (Cobo et al.,


2011; Zupic and Cater, 2014; Thelwall, 2008). Narrative literature reviews are subject to bias of
the researcher and often lack rigor (Tranfield et al., 2003). On the other hand, bibliometric
analysis offers quantitative content analysis with the advantage of using objective data
which can be collected with minimal involvement of the researchers themselves. Bibliometric
analysis also helps reduce the administrative burden for researchers in handling large
volumes of data manually (Ismail et al., 2012).
There are several approaches to bibliometric analysis such as bibliographic coupling,
co-author, co-citation, co-word and citation analysis (Cobo et al., 2011; Van Eck and Waltman,
2010). Bibliographic coupling is when two articles refer to a common third article in their
bibliographies (Cobo et al., 2011), with the strength of the bibliographic coupling measured by
the number of common articles the two publications share in their reference lists (Kessler, 1963).
Co-author analysis examines the authors, their affiliations and co-authorship data to measure


collaboration (Zupic and Cater, 2014). Co-citation (of cited references) analysis refers to the
frequency of two documents cited together in a selected pool of literature (Small, 1973) and is a
measure of similarity between documents, authors or journals (Zupic and Cater,
2014).
Co-word analysis uses the most important words or keywords of the documents to study
the conceptual structure of a research field (Callon et al., 1983). This analysis is based on the
assumption that each field of study can be characterised by a list of keywords and the
keywords in each publication can be measured for similarity in order to show a relationship
between those two publications (De la Hoz-Correa et al., 2018). In other words, co-word
analysis is a content analysis technique that uses patterns of co-occurrence of pairs of
keywords to determine the relationship between the topic ideas presented in the chosen
documents. In co-word analysis, the unit of analysis is a concept, not a document reference,
author or journal.
Different bibliometric methods entail their own strengths and weakness (Phan Tan, 2021).
For example, bibliographic coupling and co-citation are citation-based approaches, and have
a time function, whereas the more recent articles have more opportunities to be coupled with
each other by citing a previously published article. Co-word analysis is more pragmatic and is
not related to time function.
There are different software applications (e.g. Citespace, Gephi, Pajek, VOSviewer; see
features of these visual analytical tools from Pradhan (2017)) for bibliometric analysis (Pradhan,
2017). In this research to conduct bibliometric analysis, we used VOSviewer (Van Eck and
Waltman, 2014). The software supports bibliographic coupling, co-author, co-citation and co-
word analysis. VOSviewer creates a bibliographic network diagram by calculating the distance
between two nodes, indicating the relatedness of the nodes (Van Eck and Waltman, 2014). In
general, the closer the two nodes, the more closely they are related. The clustering algorithm
used by VOSviewer yields reliable and valid results and bibliographic maps provides
satisfactory depictions of data (Van Eck and Waltman, 2014).
Given the aims of the current study to employ a rigorous methodology to understand the
current state of e-tail returns research, a three-stage structured content analysis process was
followed in the literature review, namely planning, executing and reporting (Cai and Lo, 2020; Review of e-tail
Denyer and Tranfield, 2009). This process is briefly described in the following sections. product
returns
3.1 Planning and preparing
Conducting a systematic literature review involves defining, identifying, collecting and
analysing relevant articles. This includes examining how the literature content emerged,
what is the unit of analysis, what database will be used to source the materials, what 141
keywords will be used for the search, how to clean the data through inclusion and exclusion
criteria and how the data will be stored for analysis and reporting.
The unit of analysis in this study was single articles explicitly focusing on customer-to-
business product returns that result from online purchases, in other words, from e-tail
product returns. To search for targeted articles, we relied on the Scopus database, which is
widely used as a reliable source of data for literature reviews (Fahimnia et al., 2015). We
included all relevant articles until the end of 2020. All available articles in the “final”
publication stage or “in press” were included. Considering the scope of the research as a
preliminary search criterion, we restricted the search to articles that included keywords
present in the title and/or in the abstract. Figure 1 shows the combinations of keywords
entered into Scopus; namely, product returns, returns management, online purchase, e-tailer,
e-commerce, Internet, returns policy, cross-channel, omni-channel and brick-and-click
returns. These keywords formed the search protocol to identify literature pertaining to
e-tail product returns.
As the first exclusion criteria, we discarded articles not written in English, articles
published as part of conference proceedings or grey literature such as reports, theses,
dissertations, magazine articles and forewords. The second exclusion criteria consisted of
articles falling outside the scope of the study. Thus, we removed loosely related articles that
were not consistent with the objectives of the study. These included articles on product

Useable
articles
Useable
(excluding
Keywords Initial articles
conference Total useable
searched (excluding out
proceedings articles
articles of scope
and non-
articles)
English
articles)
'product returns' and
'online' 113 76 41
'product returns' and
'e-commerce' 53 31 16
'product returns' and
'e-tailer' or "brick- 17
and-click"
13 9
'returns 115–40
management' and 18 duplicated
14 9
'online' or"internet" articles = 75

'returns policy' and 27 18 7

'internet'
'returns policy' and 94
'online' 77 28

'product return' and Figure 1.

'cross-channel' or 7 6 5 Summary of article
"omni-channel" selection process
IMDS returns not related to online sales (such as brand awareness and other topics specific to
122,1 marketing, remanufacturing, landfill or other environmental management issues). The
remaining articles were screened more carefully to eliminate duplication. The final list of 75
articles was saved in Scopus and then used for further analysis. All information was
auditable for reviewing and tracking purposes.
For each of the 75 selected articles, bibliometric data such as the citation information,
bibliographic information, abstract, key words and references were converted to Research
142 Information Systems (RIS) file format for Endnote and comma-separated values (CSV) file
format for use in Excel. The final version of the reference files (in CSV format) was stored for
bibliometric analysis in VOSviewer. Further, PDF files of the full article were extracted and
stored on Endnote for all the research pool articles. Further screening was conducted of the
Endnote PDF files to avoid article duplication and irrelevance.

3.2 Execution of extracted data

We used co-word analysis to develop networks of keyword co-occurrences to identify groups of
well-connected keywords (themes) of e-tail product returns research. For co-word analysis we
pre-process the bibliographic data to avoid errors, for example, misspelling in the author’s
name, in the journal title or in the references list. We amalgamated similar keywords (e.g.
“returns policies”, “returns policy” and “return policy”; “cross-channel” and “omni-channel”
retailing; “customer behaviour”, “consumer behaviour” and “consumer behavior”; “risk
management”, “risk analysis” and “risks”) to make the analysis more practical (Perera et al.,
2020). Amalgamation is allowed to make the dictionary of thesaurus, and sometimes a concept
can be represented with different words (lexical forms) or acronyms, and yet represent the same
concept but with different spelling (Cobo, 2011). Keywords referring to methodological aspects
(e.g. “survey”, “case study”, “structural equation modelling”, “genetic algorithm”, “statistical
tests” and “optimisation”) are not relevant to the scope of E-tail product returns research theme
clustering were also excluded from the analysis (Li et al., 2019; Perera et al., 2020). Some of the
words used only once (e.g. “last-mile”, “refurbishment” or “sustainability”) could not be
distinctly ascribed to a sub-theme of study within e-tail returns literature and hence were not
considered within the clustering (Perera et al., 2020). Specifically, keywords such as “e-tail”,
“product returns”, “e-commerce” and “supply chain management” were excluded from the
cluster analysis since they were the main search terms for article retrieval. Moreover, the key
theme of the article was embedded in all these keywords (Li et al., 2019; Ahsan et al., 2021).
Each cluster was assigned a separate colour: green, red, yellow, purple, light blue and blue.
These clusters were not mutually exclusive since articles tend to overlap different domains. In
the network diagram, nodes represent a keyword while the links represent the connection
between two keywords. Co-occurrences represent the frequency of times a keyword pairing
was used within a given literature pool. The higher the frequency, the stronger the link weight
that represents the connection between a keyword pairing (Van Eck and Waltman, 2010). The
size of the node indicates the co-occurrence frequency of the keywords. To be specific, the
larger the size of the node, the more frequently the keyword co-occurred or was used.
Once we identified the clusters using VOSviewer, we manually reviewed the titles,
keywords and abstracts of all articles to ensure that the contents of each article were aligned
with the theme of that cluster. Except for a few outliers, the articles in each cluster converged
on a specific research theme. These few papers (outliers) that seemed out of place (keywords
were not within the 18 most connected keywords) were manually reassigned to the most
relevant cluster (Perera et al., 2019).

3.3 Reporting
Based on bibliometric data, we conducted a descriptive analysis (number of publications per
year, major journal outlets and bibliographic coupling of journals, co-author analysis) of
review articles in Section 4.1. Using a co-word analysis of clustered keywords (Figure 2), we Review of e-tail
analysed themes in Section 4.2. The research findings are discussed in Section 5. product
returns
4. Results and analysis
4.1 Descriptive analysis of e-tail returns articles
The data were initially assessed with respect to dimensions such as the number of
publications per year, major journal outlets, author, research methodology and other 143
backgrounds for subsequent analysis.
(1) Evolution of e-tail returns research: Considering the year of publication of the articles
shown in Figure 3, it can be seen that the topic of e-tail returns is largely a recent
research area. Since 2007, an average of five articles was published per year on this
subject. Only seven articles (9%) were published in the early stage (2007–2011), with
less than two articles per year. Later 11 articles (15%) in the first growth stage (2012–
2015) and 58 articles (77%) were published during the last five years or the second
growth stage (2016–2020). A hyper-growth stage is expecting from 2020 onwards.
(2) Prominent contributing journals: A total of 75 articles were published by 47 journals,
of these, 37 journals were from the operations, supply chain, business and marketing
disciplines. Forty-four (59%) articles were published in 16 journals (34%) (see
Figure 4). The remaining 41% of the articles were published in 66% of the journals.
An analysis of number of articles per journal shows that the International Journal of
Production Economics (IJPE) (7 articles) and Journal of Operations Management
(JOM) (6 articles) was the most popular outlets for e-tail returns articles. Considering
all the cited references of each of the 75 articles, it appears that the most cited journals
by e-tail returns articles are IJPE, JOM and Marketing Science.
(3) Co-authorship between the countries: A total of 198 authors from 16 countries
contributed to the 75 e-tail returns articles. We observed that only 25 of the authors
contributed two or more articles. The six most prolific authors and the number of
articles they contributed were Rao, S. (4 articles) and Hjort, K., Rabinovich, E., Yan, R.,
Walsh, G. and Pei, Z. (3 articles each). The majority of the authors were affiliated with
institutions from the US (35), China (20), and Germany (8) (see Figure 5). The co-
authorship between countries shows three clusters: Asia–Pacific (China, Hong Kong

Figure 2.
Network of clustered
keywords from e-tail
returns literature
IMDS 19

122,1
12
11

8
7
144 5
3
2 2 2 2
Figure 3. 1 1
E-tail returns articles
published between 2007 2008 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
2007 and 2020
Early stage Growth stage-1 Growth stage-2

Figure 4.
E-tail product returns
articles source
(prominent journals)

and Australia), Europe (UK, Spain, Germany, Netherlands and Luxemburg) and
North America and the rest of the world (US and Canada, France, India and South
Korea). Interestingly, there is a dearth of authors from Australia and New Zealand,
the UK, South America, India, Japan, South Korea and Africa.
(4) Research methodologies used in e-tail returns: We classified the e-tail returns literature
according to the research methodology that was used, namely, modelling, empirical
or conceptual studies (Wowak and Boone, 2015). Our analysis shows that e-tail
returns research methodologies are dominated by both empirical and modelling
research (see Figure 6). This tabulation is mutually exclusive.
Empirical studies can be broken down into secondary data studies, survey methods and case
study. Analysis of secondary data is the most popular empirical methodology in e-tail returns
 Review of e-tail
product
returns

145

Figure 5.
Co-authorship clusters
and links with
countries

Conceptual
1(1%) Case study
5 (7%)
Survey
15 (20%)

Modelling
Secondary data 36 (48%) Figure 6.
18 (24%) Research methodology
trend in e-tail product
returns articles

research. Most of the studies on secondary data were carried out in the United States. Data
were sourced from online e-tail rating websites such as BizRate.com, www.epubliceye.com,
and mySimon.com; marketplaces such as Taobao and eBay single retailer data; panel data of
online customers; and sales and returns data from e-tail mobile apps. The survey research
used regression analysis and structural equation modelling techniques. Most of the surveys
were conducted with customers. The surveys were conducted in countries such as the United
States, China, India, Germany and Sweden. Only five articles used case studies of online
retailers where interviewees were managers with e-commerce and supply chain roles and
logistics service providers.
Modelling research uses techniques such as analytical modelling, simulation modelling,
econometrics modelling and machine learning. Most of the modelling research was on topics
such as returns policy, cost and returns process and was from the United States and China. A
vast majority (83%) of the modelling research was conducted over the period between 2016
and 2020. Mathematical modelling and optimisation modelling were the techniques used
under analytical modelling. Among the mathematical modelling techniques various types of
deterministic and probabilistic models such as integer linear programming, mixed integer
IMDS programming were applied. Only a handful of articles used genetic algorithms, the
122,1 newsvendor model, discrete-event simulation, Markov decision modelling, game theory and a
queueing model. It is promising to see that machine learning tool has started to be used in e-
tail returns research. We identified two recent articles that applied machine learning and
artificial intelligence tools in predictive modelling (Cui et al., 2020; Yang et al., 2020).
(5) Theoretical basis of e-tail returns research: Several e-tail returns studies considered in this
146 systematic literature review employed different theoretical underpinnings. For example,
16 articles (of which 12 are empirical and 4 are modelling) used 8 different theories which
include signalling theory, dissonance theory, expectation de/confirmation theory,
consumer risk theory, procedural justice theory, contingency theory, transaction cost
economics and principal agent theory. Some of the articles used more than one theory.
Signalling theory appeared to be the most commonly used, followed by dissonance theory
and de/confirmation. A summary of applications of the theories are presented in Table 1.
4.2 Material (articles) clustering and reporting results
Using keyword co-occurrence analysis (explained in Section 3.1 and 3.2), we grouped e-tail
returns articles into six clusters. These clusters and their respective knowledge areas or
themes are analysed in the following sections.

Theory Explanation E-tail returns articles

Signalling theory Explains returns policy depth and Oghazi et al. (2018), Pei et al. (2014),
(Spence, 1973) leniency is a signal of quality. Zhang et al. (2017), Rao et al. (2018),
Furthermore, this theory underline how a Bonifield et al. (2010), Walsh et al.
strong reputation (a signal of quality) can (2016), Pei and Paswan (2018)
reduce product return rates
Dissonance theory Identified customer product returns Chen et al. (2020), Kaushik et al. (2020),
(Festinger, 1957) behavioural issues or mental status such Walsh et al. (2016)
as whether a person is not happy or
satisfied with its decision of planned or
unplanned purchasing
de/confirmation theory To explain post–purchase customer Hong and Pavlou (2014), Wang et al.
(Anderson and Sullivan, satisfaction, expectation de/confirmation (2020b)
1993) theory is used to identify relationships
between product quality, customer
dissatisfied and product returns service
Consumer risk theory Explains consumer’s perceived risk from Walsh and M€ohring (2017)
(Taylor, 1974) product returns (financial, social,
physical or some combination of these)
and returns behaviour
Procedural justice theory Justify the fairness of returns policy and Pei et al. (2014)
(Lind and Tyler, 1988) processes for the customer
Contingency theory Discuss contingencies of the returns Muir et al. (2019)
(Thompson, 1967) policy and product demand
TCE theory (Williamson, Explains consumers who are familiar Griffis et al. (2012)
1975) with an e-tailer returns process exhibit
higher comfort and confidence, which in
turn reduces their psychological-type
transaction costs of future transactions
Principal agent theory Manufacturer (principal) – retailer Yan and Pei (2019)
Table 1. (Bergen et al., 1992) (agent) supply chain in which the
Major theories applied manufacturer (principal) opens an online
in e-tail product returns channel to compete with the traditional
research retailer
4.2.1 Cluster 1: returns service and logistics. Cluster 1 covers three broad themes: returns Review of e-tail
management (five articles), reverse logistics (11 articles), and returns service (six articles). product
Modelling, case study and secondary data analysis are the dominant methodologies used in
this cluster, whereas theory is used less frequently. Only five studies are grounded on
returns
contingency theory and consumer risk theory.
Returns management: Returns management is the core theme of this cluster and this
article. In e-tail returns, consumers often do not have the opportunity to examine the product
physically, and customers are returning products to the distribution centre. E-tail returns 147
need to manage various aspects of consumer returns management elements such as
customer, products, logistics, returns claim processing and dispute resolution, in the end,
needs to win customers for future sales (Hjort et al., 2019). Integration of all the above
functions is vital and challenging. This is particularly challenging in an omni-channel
environment because of complexities in the integration and coordination of logistics activities
from different fulfilment channels (Bernon et al., 2016). Considering all these issues returns
management in the e-tail environment differs in the way returned products are handled and
related service is provided (Griffis et al., 2012). Because of its strategic role returns
management is gaining increasing importance in e-tail research. Yet research on this topic is
scarce particularly on the effects of returns management on inventory and reverse logistics
(Mollenkopf et al., 2007), and for predicting returns volume for online sales to address
operational challenges of online product returns (Cui et al., 2020). Hence, further research is
needed on designing e-commerce supply chains that would ensure better planning,
forecasting, coordination and integration of the diverse activities involved in the returns
management process (Difrancesco et al., 2018; Shang et al., 2020).
Reverse logistics: Research in this theme show challenges of logistics activities for
managing returns, and how returns logistics works and add values in e-tail returns through
activities such as the collection of the returned product; redistribution; and assessment, repair
and disposition. Research highlights a trend of using dedicated third-party distribution
centres for returns collection and processing (de Ara ujo et al., 2018). Furthermore, to ensure
greater cost-effectiveness, many e-tailers have begun to explore the possibilities of
consolidating returned products at one central collection point (Liu, 2014; Min et al., 2008).
Studies also highlighted that in an e-tail environment organising and managing returns
logistics systems is a highly complex challenge (because of several stakeholders, location,
time and customer needs complexity) that needs careful planning (Griffis et al., 2012;
Schrotenboer et al., 2017; Ofek et al., 2011). Many companies are overwhelmed and unable to
tackle this challenge internally (Frei et al., 2020). As a result, they have considered imposing
shipping, restocking and handling fees (Hua et al., 2017; Zhao et al., 2020). Moreover, because
e-commerce is extending beyond domestic markets, e-tailers must manage cross-border
returns logistics, which is usually time-consuming because of long delivery and customs
clearance times. It is also costly because of higher logistics costs (Wang et al., 2020a).
Furthermore, studies on the resilience and agility aspect of reverse logistics in e-tail returns
are overlooked, only Griffis et al. (2012) study discussed the aspect of speed in handling
reverse logistics activities which may result in greater agility, better customer service and
value recovery.
Returns service: In e-tail research, returns is viewed as a service offered to customers, akin
to “trying on clothes from a wardrobe” (Hjort et al., 2019, p. 782). In the e-tail environment,
returns service is particularly important; as customers may feel they are left out because they
do not have any face-to-face contact with the e-tailers. Research suggested that e-tailer should
focus more on ensuring service quality than incorporating a lenient returns policy (Zhang
et al., 2017; Chen and Ma, 2020). An efficient returns service can be considered a second
opportunity for service recovery in e-commerce to rectify the customer’s dissatisfaction with
the overall purchase experience (Mollenkopf et al., 2007). Research also suggests considering
IMDS returns service as a value-added activity and not a cost. This is because, unlike customers
122,1 with no returns experience, customers who have had a positive returns experience
significantly increase repeat business and loyalty (Griffis et al., 2012). Research also
demonstrates that a good customer service reputation is a tool that e-tailers can deploy to
reduce product returns (Walsh et al., 2016).
4.2.2 Cluster 2: omni-channel returns. Cluster 2 consists of three themes: returns process
(8 articles), omni-channel retail (6 articles) and omni-channel returns (11 articles). Modelling
148 and case studies are the dominant methodologies used in this cluster, whereas theory is used
less frequently. Only four articles are underpinned by theory such as the contingency theory,
signalling theory, equity theory and TCE.
Returns process: Research under this theme focuses on the e-tail returns process steps,
efficiency and facilities of returns process. The e-tail returns process can be defined as a series
of interrelated activities such as gatekeeping, returns authorisation, collection of returns
items, consolidation of returned products, restocking and product disposition (Schrotenboer
et al., 2017). E-tail returns process can differentiate their business compared to their
competitors. Research shows that if the e-tail returns process is complex, slow or
inconvenient, customer dissatisfaction will escalate and shoppers will be less likely to buy
online (from the same e-tailer), which will put the future business at risk (Griffis et al., 2012).
On the other hand, through a smooth returns process, e-tailers have the opportunity to reduce
negative customer experiences through positive service encounters (Jain et al., 2015). Thus,
previous research emphasised a clear and well-defined e-tail returns process which can be a
value driver since it would give the customer peace of mind before making any online
purchase decision (Mollenkopf et al., 2007).
The gatekeeping process plays an important role in distinguishing legitimate returns
(with valid reasons to return) from illegitimate (opportunist returns) ones (Bernon et al., 2016).
For e-tailers, gatekeeping can be carried out by third-party organisations or in cooperation
with other supply chain members, however, coordination of gatekeeping with supply chain
members with information infrastructure support system is vital (de Ara ujo et al., 2018; Muir
et al., 2019; Mollenkopf et al., 2007). Gatekeeping can be centrally managed by a returns centre
to ensure standardisation and cost-effectiveness through a uniform returns policy for all the
returns (Hjort et al., 2019). However, the process may be slow and less agile. Research has
identified that e-tailers lack the specific facilities and resources to run the gatekeeping and
other returns process, which potentially increases the returns processing costs compared to
traditional retailers (Griffis et al., 2012). Many e-tail facilities face difficulties with incorrect
tracking or screening of products. This makes decisions around the returns more time-
consuming as well as affecting product value recovery (de Ara ujo et al., 2018).
Omni-channel retail: Omni-channel retailing has become increasingly popular among
e-tailers (who have opened brick-and-mortar channels) and traditional retailers (who have
opened up online or brick-and-click channels) (Zhang et al., 2018; Balakrishnan et al., 2014;
Cao et al., 2020; Letizia et al., 2018). Previously tax-free advantage of the pure online channel is
now required to remit sales tax, and hence there is a demand for omni-channel retail to take
advantage of the comparative sales tax gap between the channels (Zhang and Choi, 2020).
The choice of sales channel depends on product category (Letizia et al., 2018). Research shows
that in omni-channel environments, retailers fulfil customer expectations through different
combinations of channels such as reserve-online-pick-up-and-pay-in-store, buy-online-and-
pick-up-in-store, ship-to-store, ship-from-store, buy-online-pick-up-in-collection-point
services to meet customer expectations (Jin et al., 2020; Akturk et al., 2018; Zhang et al.,
2018; Narang and Shankar, 2019).
Omni-channel returns: Omni-channel retailing offers flexibility by allowing cross-channel
returns such as BORS or returns to non-store location such as BORNS (Akturk et al., 2018;
Radhi and Zhang, 2019; Bernon et al., 2016; P alsson et al., 2017). In omni-channel retail, BORS
is a popular return option (Jin et al., 2020; Dijkstra et al., 2019). Articles on BORS (He et al., Review of e-tail
2020; Huang and Jin, 2020; Jin et al., 2020; Shi et al., 2018; Bernon et al., 2016) are increasing in product
number and are a recent phenomenon. For retailers, implementing a BORS option may be
beneficial since it can consolidate online and store channel returns services to offer consumers
returns
a seamless shopping experience (He et al., 2020). It also creates an opportunity for selling
products in store to online (cross-selling) to consumers who would otherwise buy in-store only
(de Leeuw et al., 2016). Further, the BORS policy may influence some online customers to
change their return channel from non-store to store (Jin et al., 2020). BORS policy is preferable 149
since it involves using existing resources and facilities of physical stores. Research also
shows that for some consumers BORS is a more convenient way of returning their unwanted
products; they can make use of more services without paying the additional costs of returns
logistics and they may receive their refunds quicker (He et al., 2020). The historical data
reveals that 11% of all online sales in the United States were returned to brick-and-mortar
stores in 2017 while in 2018, 38% of e-commerce retailers reported an increase in the return-to-
store option (NRF, 2018). The cross-channel or omni-channel returns process can thus be
leveraged as a competitive tool as online retail sales continue to grow and return rates from
these sales remain high (Jin et al., 2020). Research suggests omni-channel e-tailers need to
make the cross-channel returns process more convenient, uniform and accessible for
customers (Nageswaran et al., 2020). Omni-channel returns management has yet to fully
matured and challenges persist in integrating channels and designing reverse logistics
networks, collection points and returns processing to offer a seamless solution (Bernon et al.,
2016; Dijkstra et al., 2019; Muir et al., 2019).
4.2.3 Cluster 3: returns policy and customer. Cluster 3 covers themes related to returns
policy (17 articles), quality control (6 articles), order fulfilment (4 articles) and customer
purchase intention (4 articles). Most of the studies use empirical and modelling methodology.
Articles in this cluster are underpinned by the justice theory, signalling theory, price theory
and principal agent theory.
Returns policy: The central theme of cluster 4 is the e-tailer returns policy. This policy
ensures pre-and post–purchase product returns information (Chen and Chen, 2016). Returns
policy research has focused on the time window of returns policy, the implementation of
returns policy returns authorisation, and terms and conditions of change of mind returns
(Difrancesco et al., 2018; Zhang et al., 2017; Posselt et al., 2008). Policy studies are mainly built
on the signalling theory, which suggests that returns policy can be considered a market
signalling mechanism that allows the e-tailer to convey a commitment signal towards
customer service, thereby prompting customer trust (Oghazi et al., 2018).
Returns policy research was classified into the following types: lenient, moderate and
strict. Several studies have been conducted on lenient returns policy (Hua et al., 2017; Oghazi
et al., 2018; Bower and Maxham, 2012; Altug and Aydinliyim, 2016; Bonifield et al., 2010).
Research identified that customers demand leniencies in the form of free returns or late
returns (Difrancesco et al., 2018), free returns at no service charge (Hua et al., 2017), change of
mind return policy (Hua et al., 2017), return time leniency or longer merchandise return
windows (Rao et al., 2018). In the online shopping environment, a lenient returns policy
conveys a positive message to the customer before they make any purchase decision (Altug
and Aydinliyim, 2016), it can be considered a form of quality assurance or signal of the high
quality of a product and thus offer peace of mind to the customer before they purchase (Yu
and Kim, 2019). Return policy leniency also conveys the perceived fairness of the return
experience and is an important supporting factor that influences a customer’s intention to
repurchase (Wang et al., 2020b; Yu and Kim, 2019). A lenient returns policy helps e-tailers to
build consumer trust and market reputation (Pei et al., 2014), hence e-tailers can attract more
customers, thereby adding greater value to their business (Gelbrich et al., 2017). Research also
shows that there are risks of a lenient policy for e-tailers is that there is the chance of customer
IMDS abuse, which could result in many unwanted returns, entailing high costs of returns handling
122,1 (Posselt et al., 2008; Lantz and Hjort, 2013). A moderate returns policy is beneficial for both
e-tailers and customers. Research describes a moderate returns policy (Posselt et al., 2008) as
an optimal point of leniency and restrictiveness. It enables a retailer to positively influence
consumer purchases and firm performance (Yan and Pei, 2019). This policy may accept
change of mind returns but only with valid proof of purchase and within set time restrictions.
Customers perceived it as a fair return policy while e-tailers can use it as competing
150 marketing strategies to attract more customers (Pei et al., 2014). Lastly, a strict returns policy
implies many gatekeeping rules and restrictions. Research on this type of policy is rare.
Because of customer abuse of lenient returns policies and because of the high costs of returns
handling, retailers are in favour of stricter returns policies (Yu and Kim, 2019).
Quality control: Quality control (product and service) is closely related to product returns
and is identified as a core topic in six e-tail articles. Research shows that product quality is a
key factor that may decrease customer satisfaction and lead customers to return a product
(Lin et al., 2020; Misra and Arivazhagan, 2017). Product quality problems that cause returns
include product defects, wrong product description, decay, wrong product delivery,
misinterpretation of the product’s value (Li et al., 2013). In contrast, high-quality products
can satisfy the customer and reduce the number of returns (Li et al., 2013). The quality of
logistics service also plays an important role in e-commerce product returns. The products
may be fragile but not well-packaged during shipping, which may cause damage during
delivery, leading to customer dissatisfaction (Fu et al., 2016). Research also shows that the
likelihood of product returns is high if there are inconsistencies between e-tailer promises of
timely delivery of orders and the actual delivery (Rao et al., 2014). There is little theory in
quality control research; the expectation confirmation theory is the only theory used as a
theoretical lens to explain post–purchase customer satisfaction as a function of expected
product quality uncertainty (Hong and Pavlou, 2014).
Order fulfilment: Order fulfilment in e-tail involves picking the right product, putting it in
the right box, shipping it and gaining the customer’s approval on arrival (Jain et al., 2015).
Order fulfilment service quality influences the e-tailer’s sales and reputation (Ramanathan,
2011). To satisfy diverse customer needs, e-tails offer various order fulfilment models such as
buy-online and pick-up-in-store, ship-to-store, ship-from-store and reserve-online-and-pick-
up-in-store services (Serkan et al., 2018). The success of e-tailers depends on the performance
of these order fulfilment models, which further depend on the operational excellence of third-
party logistics providers and order fulfilment centres (Rao et al., 2014).
Customer purchase intention: Customer purchase intention is contingent on product
quality (Li et al., 2013), a positive prior shopping experience (He et al., 2020) or returns policy
fairness with a money-back-guarantee (MBG) (Pei et al., 2014). Using the justice theory, Pei
et al. (2014) postulate that the depth of a returns policy (e.g. extensiveness of the policy) will
increase the perception of policy fairness and whether the seller’s policy, price, or service is
reasonable. This, in turn, has had a positive influence on customers’ purchase intention.
Using empirical evidence and the lens of the signalling theory, Zhang et al. (2017) show that a
long return window, lenient returns policy and an easy returns process indicate high service
quality, which positively affects purchase intention.
4.2.4 Cluster 4: returns cost and channel coordination. Cluster 4 focuses on the themes of
returns cost (11 articles) and channel coordination (3 articles). Articles in this cluster (mostly
cost-focused research) use quantitative modelling such as mathematical modelling, genetic
algorithms and analytical methods. A key topic of discussion in this cluster is associated with
the cost. Articles focusing on cost use the transaction cost theory and consumer risk theory.
Cost: From an operations perspective, product returns are considered a cost centre for
retailers (Griffis et al., 2012). This perception is continuing and has been investigated in recent
research. Griffis et al. (2012) view product returns as a transaction cost, while Liu (2014) terms
it as a necessary cost of doing business that cannot be avoided in e-tail. The cost of processing Review of e-tail
online returns per item is generally higher than it is for conventional retailers. Several studies product
concur that compared to traditional brick-and-mortar retailers, e-tailers encounter higher
product returns and higher related costs of transportation, inspection/gatekeeping, testing,
returns
refurbishment and value erosion (Griffis et al., 2012; Difrancesco et al., 2018). Several articles
associate returns policy with a cost. Research in this cluster demonstrates that a lenient
returns policy increases the number of product returns and leads to substantially higher
returns costs (Shang et al., 2017; Yan and Pei, 2019). For no-reason or unconditional returns, 151
online retailers must decide whether to accept consumer returns for free or whether to partly
or fully charge for return costs (Hua et al., 2017). To recover the returns handling cost, some e-
tailers impose restocking fees or a strict returns policy with many gate-keeping rules
(Difrancesco and Huchzermeier, 2020) and offer complementary returns-freight insurance
(Fan and Chen, 2020). Other e-tailers reduce the volume of returns by restricting the return
time window (Difrancesco et al., 2018). Difrancesco and Huchzermeier (2020) suggested that
by imposing restocking fees on the buyer, e-tailers can recover some of the returns
management costs provided customers view the online purchase as having higher quality
than a brick-and-mortar purchase. Some retailers offer free shipping to customers and a
30-day return policy for a refund minus a restocking fee option (Ishfaq et al., 2016). Such a
refund policy is effective in discouraging returns fraud.
Posselt et al. (2008) developed a model to calculate the insurance cost of MBG, with options
for different types of coverage and duration. The authors also developed a genetic algorithm
model to optimise the e-tailer’s number of collection points and return product disposition
centres to reduce the operation costs of returns handling. For consumers, return cost could be
directly or indirectly related to the time, effort and psychological burden associated with a
return in addition to the return fee charged by the online retailer (Gu and Tayi, 2015). Gu and
Tayi (2015) show that a strict returns policy increases consumer return cost and effort
compared to a lenient returns policy. Their findings demonstrate that for apparel products, a
tighter returns policy increases consumers’ return costs, which motivates consumers to alter
a misfitting item after purchase as opposed to returning it.
Channel coordination: Another topic included in this cluster is channel coordination, with
two articles. Yan and Pei (2019) investigated the role of different returns policies between
online and offline channel coordination. Gu et al. (2018) examined revenue-sharing contract
failure to achieve channel coordination in supply chains as a secondary theme of the article.
However, this topic is not directly relevant to e-tail returns management and is not discussed
further.
4.2.5 Cluster 5: customer purchase and returns behaviour. Cluster 5 covers themes relating
to customer returns behaviour (8 articles), product review (4 articles), purchase decision (3
articles) and MBG (3 articles). Customer purchases and returns behaviour are the core themes
of this cluster. Almost all the studies in this cluster are based on survey and archival data.
Empirical studies mostly use customer data and are based on theories such as the signalling
theory, risk theory, expectation disconfirmation theory and theory of information economics.
Customer returns behaviour: E-tailers do not meet the customer directly and reading
customer needs and behavioural are difficult. Research in this cluster shows that studying
consumer behaviour in product returns is essential for effectively managing e-tail product
returns and providing superior customer service. Consumer behaviour in this context focuses
on why customers return products and how they behave since they intend to return to during
the product return (Lantz and Hjort, 2013). Behavioural causes of product returns include
change of mind, no-fault returns or fraudulent behaviour (Chen et al., 2020; Lin et al., 2020; Pei
and Paswan, 2018; de Ara ujo et al., 2018). Pei and Paswan (2018) identify two types of customer
returns behaviour: legitimate returns and opportunistic returns. Legitimate returns are based
on valid reasons to return the product (faulty, damaged or wrong product delivered).
IMDS Sometimes, customers consider the product is faulty and believe they have a legitimate reason
122,1 for the return whereas, in reality, it is a false claim or a no-fault return. This problem occurs
because online customers cannot physically investigate the product and some customers have
a lack of knowledge or instructions or lack of product operation knowledge (such as
improperly assembled parts) (de Ara ujo et al., 2018). Opportunistic product returns behaviour
involves the misuse of the e-tailer returns policy through the customer’s questionable
behaviour (Kaushik et al., 2020). Some studies demonstrate that customer returns behaviour in
152 an e-tail environment depends on risk and product price; customers are more likely to return
high-priced items with returns fees, with correspondingly lower returns for less costly items
(Rabinovich et al., 2011). Research shows that free return labels have no influence on
customers’ opportunistic product returns behaviour (Walsh and M€ohring, 2017). Sometimes,
customers who successfully claim an opportunistic returns may feel guilty and may be too
embarrassed to come back to do the same in the near future (Pei and Paswan, 2018).
Product review and purchase decision: Product review can influence e-retailers’ sales and
reputation (Griffis et al., 2012). Sahoo et al. (2018) indicate that when consumers return
products, they are more likely to write online reviews and these reviews are more negative
than those for a non-returned purchase. Positive online product reviews with an MBG and
lenient policy can motivate customers to take repeat online purchase decisions, which
sometimes triggers higher product returns, resulting in lower profits for the e-tailer (Minnema
et al., 2016). In contrast, other researchers claim that online product reviews decrease the
product return rate because customers can better evaluate the product from the online review
(Walsh and M€ohring, 2017). Furthermore, free shipping promotions encourage customers to
make riskier purchase decisions which result in more product returns (Shehu et al., 2020).
Money-back: MBGs in e-tail returns are an important assurance for the customer.
Regardless of the type of returns policy, e-tailers offer MBGs to customers for returning the
product within a specified time (Shang et al., 2017). The MBG can signal implicit product
quality and act as an assurance of order fulfilment, which reduces customers’ perceived risk.
This in turn influences customer purchasing and returns behaviour (Walsh and M€ohring,
2017). Previous studies have demonstrated that MBGs protect customers by reducing their
financial risk; they also provide the customer with peace of mind; if they are not satisfied with
a product, they can rest assured that a refund will be made for the purchase price and postage
costs (Walsh and M€ohring, 2017; Posselt et al., 2008). Posselt et al. (2008) developed a model to
offer customers different insurance costs of MBG with different types of coverage and return
durations. Drawing on the risk theory, research has also demonstrated that MBGs encourage
customers to order more which might lead to a higher product returns rate (Walsh and
M€ohring, 2017).
4.2.6 Cluster 6: customer satisfaction and risk. Cluster 6 consists of two themes: customer
satisfaction (six articles) and risk (three articles). Modelling, survey and content analysis of
secondary data are the methodologies used in this cluster. Theory is also used in this cluster,
with five out of ten articles grounded in a theory (the signalling theory, consumer risk theory,
expectation confirmation theory, relationship marketing and theory of information
economics).
Customer satisfaction: In an e-tail environment, customers spent more time dealing with
returns process and returns service logistics. Hence, customer satisfaction with the return
transaction has a significant impact on future purchasing behaviour (Mollenkopf et al., 2007).
Positive purchase and returns experiences can lead to revisit the e-tail website and hence can
generate new sales (Walsh and Brylla, 2017). Some studies suggest that during online buying,
customers face issues of “product fit uncertainty” (whether a product’s attributes match the
preference or fit for purpose), which has a distinct effect on consumer satisfaction (Hong and
Pavlou, 2014). This product fit uncertainty’ is causing more harm than “product quality
uncertainty” for customer satisfaction as well as resulting in more returns. Research also
indicates that overly positive online product reviews sometimes create a gap between Review of e-tail
customers’ perceived expectations of product quality and the actual product. This then product
results in customer dissatisfaction and consequently increases returns (Minnema et al., 2016).
Research shows that the likelihood of orders being returned depends on the consistency
returns
between retailer promises of timely delivery of orders and the actual delivery of the orders
(Rao et al., 2014; Zhao et al., 2018). Research suggests the use of artificial intelligence tools to
reduce product fit uncertainty and improve after-sales services for e-tailers (Yang et al., 2020).
Risk: Usually, e-tailers view product returns as a manageable risk and set up operation 153
management functions and systems to cover the cost of product returns or they transfer these
costs to the customer (Vilar-Zanon et al., 2017). Customers view low-price and low-ambiguity
products as low-risk products and purchase these without much detailed analysis. A hassle-
free and lenient returns policy motivates customers to purchase these types of products by
further reducing the risk of purchase (Ramanathan, 2011). In contrast, poorly or incorrectly
described products and ambiguous product information increase customer risk of the
purchase, thereby increasing the rate of returns (Rabinovich et al., 2011).

5. Discussion, summary of findings and future research agenda

In this section, we discuss research trends and findings obtained from the cluster analysis of
e-tail product returns as well as the gap analysis. A future research agenda is delineated.

5.1 Synthesising a conceptual framework for future research and application

The study findings are synthesised through a proposed theoretical framework shown in
Figure 7. In the proposed framework, customers and e-tailers are the two main parties
involved in returns activities. The interaction between these two entities occurs through five
key themes of e-tail returns management (discussed in Section 4.2) which are returns policy,
returns process, returns service, cost and associated risk. Though some of the key themes in
this framework are also important in the brick-and-mortar retail context, the application of
the themes is specific to the e-tail environment and needs to be managed specifically for
e-tails. Themes focusing specifically on e-tailers are the operational aspects of returns
management such as managing reverse (returns) logistics, omni-channel retail, omni-channel
returns and ensuring product and service quality. The key customer-focused themes are
related to customer behaviour, such as online purchase intention and decision, product
returns behaviour and customer satisfaction with the product. To manage and carry out the
activities under these themes, e-tailers need to build capability and acquire resources in areas
such as people, knowledge, skills, technology and IT systems, which could be part of
organisational strategic choice.
In the end, by carrying out these activities, e-tailers can not only effectively manage the
returns but also transform non-value-adding returns into value-adding tasks. The examples
of such value outcomes may include maximisation of resale of returned products, improved
customer purchase intention, increased purchase decision, enhanced customer service and
satisfaction, greater customer retention and larger market share. In the following section, we
briefly outline the key features of the proposed framework.
The returns policy theme relates pre-and post–purchase returns information with
perceived benefits and risks. It guides e-tail returns management personnel to operationalise
the returns claim from customers. It is evident that different types of returns policies such as
lenient, moderate and strict have different effects on e-tailers and customers. An assessment
of the customer perception of returns policies can play a critical role in formulating marketing
strategies to retain and attract more customers. A lenient returns policy provides customers
peace of mind may boost e-tailer sales and value in the business. From the perspective of
IMDS Managing omni-chennel return, Managing returns with skills, Managing product and
122,1 reverse logistics technology and IT systems service quality

Returns policy

154
E-tailer
Returns process

E-tail value addition

Returns service

Returns cost Online customer

Returns risk

Customer behaviour
Figure 7. ● Product returns behaviour
A conceptual ● Purchase intention
framework of e-tail ● Purchase decision
returns management ● Customer satisfaction

customer service, it is imperative to have the stated returns policy in action. Further value
addition is possible through continuous review of returns policies to align with organisation
strategy, assessment of policies in comparison with competitors’ policies and local business
rules and regulations (Zhang et al., 2017).
Due to the nature of the business, e-tailers encounter more product returns volumes than
traditional product returns, hence e-tailers need to be prepared to handle returns properly.
The e-tail returns process is more complex and diverse than traditional brick-and-mortar
retail returns. The process is further complicated due to omni-channel retailing with cross-
channel or omni-channel returns. To add more value in returns, e-tailers can provide an easy,
hassle-free and efficient returns process for a customer to minimise costs and increase
customer satisfaction. For example, clearly defined returns processes, minimal customer
effort required for returns, fewer gatekeeping rules, greater service coverage, quicker
resolution of customer product returns and restocking the product more quickly. To facilitate
an efficient returns management process, e-tailers need to integrate internal cross-functional
units. It is also essential to integrate and coordinate external (multiple supply chain)
organisational units since the returns process involves manufacturers, wholesalers, logistics
service providers, fulfilment centres and collection points, and these may not be located in the
same geographical area. Overall, the process of returns enhances customer convenience and
improves efficiency in supply chain systems.
As stated earlier, e-tail management can create a better returns service for customers to
recapture greater value, which may change the traditional view of returns management as a
cost centre. Through better customer service, e-tailers have another opportunity to recapture
value or restore loss resulting from product returns. Dealing with customers could be dealing
with behavioural issues of the customer. When managing returns, e-tailers also need to Review of e-tail
understand customer behaviour, which can guide them to improve their returns services. product
For e-tailers, the cost function of returns may include costs of running the returns
customer services, product replacement or repair, losing market share or goodwill of
returns
mishandling the returns. For consumers, returns costs may be directly or indirectly related to
the time, effort and psychological burden associated with a return in addition to the return fee
charged by the online retailer (Gu and Tayi, 2015). Literature suggests e-tailers consider
returns as an opportunity for value capture for themselves and their customers. Value can be 155
added by providing improved customer service during returns for customer retention,
management of effective inventory management of returned goods and product
dispositioning (Mollenkopf et al., 2007).
Returns management also exposes both to e-tailers and customers to risk. E-tailers are
competing for the business with the returns process of brick-and-mortar stores. In an e-tail
environment, time to purchase a product and conduct a physical inspection, and time and
effort to return a product is more than brick-and-mortar store purchase, hence consumers are
taking more psychological burden associated with a purchase and return in addition to the
return fee charged by the online retailer. Hence returns policy and process need to be
attractive compared to competitive physical stores. To improve customer retention and a
second chance of sale during the returns process e-tail returns policy and process should be
attractive to the customer and needs to clearly state within the website.
E-tailers work on unique returns logistics activities than traditional brick-and-mortar
retail returns. To facilitate an efficient returns management process and logistics, e-tailers
need to integrate internal cross-functional units with returns service. Returns logistics
provides may need to work with the customers to organise returns if it is returned to the
warehouse. It is essential to integrate and coordinate customer and external (multiple supply
chains) organisational units since the returns process involves manufacturers, wholesalers,
logistics service providers, fulfilment centres and collection points, and these may not be
located in the same geographical area.
Our model identifies resource requirements as a key factor in e-tail returns. This factor has
rarely been researched as the core subject of an article (it has only featured as a peripheral
topic). Hence it has not been captured through cluster analysis, despite playing a central role
in e-tail returns management. In the proposed model, we identify three types of resources: (1)
people skills, (2) technology and (3) IT systems. First, our model stresses the importance of the
knowledge and skills of returns personnel to run e-tail returns and to add value to the
business. Skilled returns personnel (in-house or a third party) can be considered valuable
resources. Through proper utilisation of skilled returns personnel, e-tailers can efficiently
handle the returns gatekeeping process, resolve returns claims quickly and turn service
failure into service delight, which can lead to lower operating costs and service
differentiation. Second, the model highlights the importance of modern technologies such
as social media, big data, machine learning, artificial intelligence, virtual reality, augmented
reality and blockchain. These technologies are the key for e-commerce and can be harnessed
to minimise returns fraud or no-fault product returns; they can also be used to avoid fit
uncertainty. This would add value by allowing customers to make more informed decisions
as well as easing the pressure placed on the returns process (such as gatekeeping). Third, IT
systems, such as computer systems, computer programs, networks, hardware, software,
electronic databases, and websites used to process, store, maintain and manage data, all play
an essential role in facilitating communication and integration of information systems within
e-tail returns management. IT systems can make the returns process more visible and
traceable and they can also provide relevant and precise information to understand customer
purchase and returns behaviour by tracking previous purchases and returns. Providing
appropriate and precise product information can prevent unnecessary returns (de Leeuw
IMDS et al., 2016). The process of information sharing should be clearly explained within an
122,1 organisation and to supply chain partners to avoid any misunderstanding, to ensure proper
flow and timing of return information and returns management integration within omni-
channel returns.

5.2 Research gaps and e-tail returns research agenda

156 Our systematic literature review provided valuable insights into the existing body of research
on e-tail returns. The key findings and gaps that were identified provide a platform for future
research. These new research directions are summarised below.
(1) Publication trends: Literature suggests that e-tail returns research is an emerging
area. Publications in this area gained momentum in the last five years (2016–2020)
when over 75% of articles were published. Analysis also shows that about one-third
of e-tail product returns research was published in only five specialised journals.
Also, the majority of these studies were conducted in a limited number of countries.
Consequently, it does not adequately represent major global e-commerce markets,
ignoring various regional aspects. Asian countries such as China, Japan, South Korea
and India together represent the largest e-commerce market in the world, with high
usage of platforms such as Alibaba, Tmall, Rakuten and Gmarket. Unfortunately, no
research was identified in relation to these e-commerce platforms. Hence, further
research is recommended in these markets and e-commerce platforms.
(2) Theory-based e-tail research: Theory-driven research are mostly empirical research. It
appears that theory-based research in e-tail is mostly used to explain or identify the
relationship of product returns with customer behavioural, risk and to justify the
fairness of process and policy. There is limited use of theory on risk, cost and
resource, and there could be more application of theories in other knowledge areas
returns-such as e-tailer risks of process, policy and service, returns logistics cost and
efficiency and resilience. Eight different theories were used in 16 e-tail returns studies.
Empirical studies predominantly used these theories. These studies used theories
from psychology and behavioural economics because most focus on consumer
behavioural aspects on returns. Future e-tail returns research could use theories such
as the TCE, resource-based view, and contingency theory and theory of planned and
unplanned behaviour.
(3) Research methodology: The dominant research methodology in e-tail returns is
modelling research. However, in the recent past, the emphasis has shifted from
modelling to survey method. Case studies and longitudinal studies are rare, and
further research could examine perceptions of e-tail management and other supply
chain partners. Amongst the modelling research, only two studies have used machine
learning or artificial intelligence-based tools. Future research may employ machine
learning-based tools to predict customer returns patterns and forecast possible online
returns.
(4) New and emerging themes: Unfortunately, similarly to other established disciplines in
reverse logistics, e-tail product returns have not been explored in any detail in
previous research. However, research focus on e-tail returns is emerging. In the points
below we briefly address the research gaps created by emerging themes with future
research directions.
 In global e-commerce, customers, retailers, fulfilment centres and logistics
operators are in different geographical regions, hence there are cross-border
logistics issues within the e-tail returns management process. Cross-border
 e-commerce sales are growing, hence cross-border e-commerce retailers are Review of e-tail
required to manage their high product return rates (Wang et al., 2020a). Moreover, product
due to long delivery and customs clearance time, and higher logistics costs (Wang
et al., 2020a), the value customers perceive when receiving products could be
returns
different from the value they perceive when they placed the order. Unfortunately,
research on this topic is scarce. Indeed, the analysis reveals that there was only
one article in 2020. Because of the importance of this topic, we propose cross-
border returns (Wang et al., 2020a) and logistics as a new research direction in e- 157
tailer product returns.
 The importance of managing e-tail returns within an omni-channel environment
is increasing since online has been growing rapidly (Bernon et al., 2016) and
research on omni-channel and cross-channel returns has started to grow since
2018. Recent research shows cross-channel returns are more convenient, uniform
and accessible for customers (Nageswaran et al., 2020). However, there is a lack of
research to investigate customer returns behaviour and expected service
preferences in an omni-channel environment. Further research could to
investigate customer preferences and behavioural aspects in cross-channel
returns, and how to add greater value from consumer returns through improved
channel integration and coordination. Furthermore, the logistics challenges
(product restocking, repair, redistribution, reimbursements) of cross-channel
returns need to be further investigated to plan for recapture value from the
returns process.
 Research on the environmental and social sustainability of reverse logistics
activities emerging from e-tailer returns is rare. There are no specific themes
identified from the article’s keywords clustering. We found only two articles
covering employee’s wellbeing (Frei et al., 2020), and energy consumption in the
returns process (Palsson et al., 2017). We emphasise the need to further examine
social and sustainability issues of the e-tail returns process and logistics activities.
 Organising and managing e-tail product returns systems is a highly complex
challenge that needs dedication, and resources support. To facilitate an efficient
and ease of return returns process, e-tailers require resources and skills. Existing
research has overlooked the issues of resources and skills required to manage
e-tail returns. We consider “knowledge and skill” can be a theme of e-tail product
returns without which it is not possible to add value from product returns. Hence,
further research could examine how service professional skills could enhance
returns service quality and service recovery to add value through increased
customer satisfaction. Moreover, studies could explore how employees could be
empowered to take some real-time and non-routine e-tail returns claim decisions
for quicker service recovery.
 There is a lack of research on the benefits of using modern technologies in the
e-tail returns environment. Our analysis identified only one article on mobile app
adopters and product returns volume (Narang and Shankar, 2019). Other studies
briefly mentioned the use of virtual fitting technology to reduce product returns in
online purchases (Shang et al., 2017; Sahoo et al., 2018). Technology use can lower
transaction costs of making returns and increase the effectiveness of the e-tail
returns management process (Serkan et al., 2018). Conducting online customer
surveys on returned products is a good source of information for e-tail and other
supply chain partners to investigate the causes of returns. Using modern
IMDS technologies, companies can gather product and customer expectation data and
122,1 analyse them on a real-time basis to identify the root cause of product returns to
avoid or improve returns process and service. Hence, we propose further
investigation including the affordances of suitable modern technology as a
possible future research direction in e-tail returns. Future research is expected to
incorporate how these technologies can influence customer purchasing and
returns, and predict or forecast returns volume of e-tailers, and how technology
158 can assist in minimising returns fraud, or no-fault product returns to provide
more information about the product or to avoid fit uncertainty.
 The role of IT systems support in e-tail returns is under-researched. E-tail returns
research does not directly focus on IT systems support as the main theme. IT can
be the backbone of running the e-tail returns process. IT systems can improve
communication between customer and e-tailer and reverse logistics service
providers, returns process can be more visible and product and returns claims
status can be more traceable. Further studies are recommended on the role of IT
systems in “connecting the dots” in e-tail returns information and communication,
particularly in managing returns logistics, channel integration and customer
product returns claims. This would also assist in tracking and tracing customer
and product information.
 Returns service is an important component of e-tail returns yet the area is
understudied, with only six articles on this topic. From the customer’s point of
view, it is expected that they are treated fairly during the returns process.
However, in the e-tail environment, customer service is often problematic because
customers feel left out since they have no face-to-face contact with e-tailers (Hjort
et al., 2019). Through better customer service, e-tailers have a second chance to
recapture the value or restore the loss of the returned product. Further research in
this promising area could identify key factors or determinants of e-tail returns
services expected from customers.
 Customer behaviour in different geographical areas also differs, which may affect
the e-tail returns rate. Research on behavioural aspects of e-tail returns has
started to grow since 2017. Some of the previous studies we identified behavioural
causes of product returns. However, further studies are needed in this area to
investigate the psychological aspects of behaviour, cultural influences and
returns fraud.
 Risk management is identified as an emerging theme in e-tail returns. Only three
studies considered the risk, with a focus on e-tailer cost risk from lenient returns
policies and customer risk from purchasing the wrong product based on
inaccurate information. There are risks for e-tailers (cost, loss of goodwill,
customers or potential sales, more returns) and customers (perceived cost and
effort, risk from returns process, policy and service). Future research could
examine the risks in order fulfilment that trigger returns as well as delivery and
returns logistics risks stemming from supply chain disruptions. Moreover, future
research can investigate how e-tailers are preparing to mitigate these risks and
what are the possible impacts of mishandling returns.
 Our proposed conceptual model of e-tail returns management is an accumulated
representation of all key themes in e-tail returns research. The model could be
used strategically in future empirical research to add more value to product
returns.
  Lastly, in e-tail returns during and post the COVID-19 era, our analysis revealed Review of e-tail
virtually publications on e-tail returns related to pandemics. However, during product
COVID-19, the online purchase has increased (OECD, 2020) and so has consumer
product returns. Because of COVID-19, many brick-and-mortar retailers turned returns
(or expanded) their business to e-commerce and e-tailers tightened their returns
policies to reduce the returns rate because of customer panic buying. Hence, it
would be fascinating to know how e-tailers controlled unwanted returns while
allowing genuine returns, or other aspects of returns, because of pandemic and 159
supply chain disruption in the COVID-19 environment.

5.3 Contributions and implications

This study makes several contributions to the reverse logistics and e-commerce literature.
First, the paper contributes a systematic review in the area of e-tail returns, which is different
from product returns in a brick-and-mortar environment in terms of interaction with
customers, or complexity of using different returns channels, returns process, and policy,
related logistics services, and IT support. E-tail returns is a rapidly emerging topic because of
the increasing demand for e-commerce retailing. To our knowledge, no systematic review has
been recently undertaken to provide an overall picture of existing e-tail returns research to
identify knowledge areas that have been covered and those that still need to be addressed.
Second, this study maps e-tail returns thematic areas and proposes a conceptual
framework of e-tail returns management. It can assist practitioners as a guide to better
understand the key aspects of e-tail returns management and improve e-tail product returns
processes. The findings of this research can assist practitioners in developing policies around
return measurement and service standards and return process evaluation. Also, it may guide
resource allocation to e-tail return logistics support such as skills training. Moreover, reading
the available literature on this subject is almost impossible for most managers, who may be
influenced by one or a few papers that do not represent the entire body of literature. This
review, therefore, constitutes a time saving for practitioners, offering a more comprehensive
picture of the subject than a single empirical study.

6. Conclusion and limitations

With the rise of e-commerce and globalisation, the issues of product returns in the e-tail
environment are increasingly coming to the fore, and academic literature has grown
correspondingly. The systematic review of 75 articles provides a more comprehensive picture
of e-tail returns research from various methodological and theoretical perspectives. The
descriptive analysis of these articles shows trends in e-tail returns research, with the article
number distribution by year, by outlet, by citation, by country and by research methodology.
Operations, production and supply chain journals are common outlets for e-tail returns
research. Our findings reveal that research on e-tail returns is in a growth stage, with
exponential growth seen in the last five years.
Using bibliometric analysis software (VOSviewer), we categorised the themes or
knowledge areas of e-tail returns literature into six clusters and discussed all identified
papers under each cluster. Based on our analysis of key factors in e-tail returns and explored
and unexplored themes, we proposed a conceptual framework for e-tail returns management.
This forms the theoretical contribution of this article. In the conceptual framework, we
emphasised the importance of the supportive role played by skills, technology and IT
systems. Finally, several promising research opportunities were derived from our analysis.
This study has certain limitations. The scope of the research was limited to journal articles
published in English. Consequently, relevant work published in other languages from leading
IMDS e-commerce countries might have been missed. However, it would have been practically
122,1 difficult to capture relevant content from title, abstract and keywords, given that translations
would have been required from the other languages. Further, the inconsistent use of
keywords in published articles made it difficult to capture all relevant papers using only the
search and exclusion terms.

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Corresponding author
Shams Rahman can be contacted at: shams.rahman@rmit.edu.au

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