The Effect of Return Policy Leniency on Consumer Purchase and Return Decisions: A Meta-analytic Review

Abstract

While most retail stores offer return policies, some offer more lenient return policies than others. The inherent belief is that lenient return policies are more likely to lead to purchases than to encourage returns. Examining prior research we find that return policy leniency has been characterized in terms of five different dimensions: time, money, effort, scope, and exchange. We conduct a meta-analysis of 21 papers examining the effect of leniency on purchase and return decisions, and demonstrate that overall, leniency increases purchase more than return. Further, we show the return policy factors that influence purchase (money and effort leniency increase purchase) are different from the return policy factors that influence returns (scope leniency increases returns while time and exchange leniency reduces returns).