Are Return Policies Viewed the Same Way? U.S. and Chinese Consumer Perceptions of Return Policy and Perceived Risk

Abstract

As globalization continues to experience substantial growth, how fashion retailers reshape return policies to accommodate consumer expectations in different cultures to maximize the profit has become a central task in today’s retail complex. The purpose of this study is to empirically examine how subjective norm and perceived risk influence consumer perceptions of return policies in China and the U.S. based on the theories of perceived risk and planned behavior. Online surveys associated with two ecommerce scenarios, (1) a 15-day limit for returns and (2) the consumer pays for shipping fee, were conducted to collect data from 307 female participants in two major universities in the U.S. and China. Confirmatory factor analysis, measurement invariance tests and structural equation modeling were employed to test the hypothesized models. The results indicate that perceived risk negatively and subjective norm positively influence consumer attitude toward the return policy across the two samples. In addition, subjective norm and attitude significantly influenced purchase intentions. An interesting finding is U.S. consumers who perceived a high level of support from friends and family (subjective norm) for the 15-day return policy also considered the return policy to be of lower risk while results from Chinese consumers differed. As we continue to focus on emerging retail issues, this study contributes to the understanding of cross-cultural differences in consumer perceptions of return policies of apparel retailers.