Customer Search and Product Returns
Online retailers are challenged by frequent product returns. High return rates significantly decrease companies’ profit which makes the issue of managing product returns very important from the practical standpoint. Typically, practitioners study returns in connection with purchase decisions or as a...
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| Other Authors: | |
| Format: | Thesis |
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Massachusetts Institute of Technology
2022
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| Online Access: | https://hdl.handle.net/1721.1/145177 |
| _version_ | 1811090921955000320 |
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| author | Ibragimov, Marat |
| author2 | Hauser, John R. |
| author_facet | Hauser, John R. Ibragimov, Marat |
| author_sort | Ibragimov, Marat |
| collection | MIT |
| description | Online retailers are challenged by frequent product returns. High return rates significantly decrease companies’ profit which makes the issue of managing product returns very important from the practical standpoint. Typically, practitioners study returns in connection with purchase decisions or as a part of customer behavior/type. In this paper, we show that the events which precede the purchase decision are related to the return decision. Generally, this information is readily available to online retailers and thus provides a low-cost opportunity to better understand and predict the product returns.
Based on the data provided by a large apparel retailer, we demonstrate that the way customers search for a product is indicative of product returns. We find correlational evidence that using search filters, spending more time, and purchasing the last item searched are negatively associated with the probability of return. We propose a joint model of search, purchase and return which is based on an analytic model of search, purchase, and returns. Our model is consistent with the findings in the data and provides insight into how search and returns are related. Finally, using a machine learning framework, we demonstrate that adding search data improves the prediction accuracy of individual-level return rate above and beyond prior models. |
| first_indexed | 2024-09-23T14:53:47Z |
| format | Thesis |
| id | mit-1721.1/145177 |
| institution | Massachusetts Institute of Technology |
| last_indexed | 2024-09-23T14:53:47Z |
| publishDate | 2022 |
| publisher | Massachusetts Institute of Technology |
| record_format | dspace |
| spelling | mit-1721.1/1451772022-08-30T03:15:09Z Customer Search and Product Returns Ibragimov, Marat Hauser, John R. Sloan School of Management Online retailers are challenged by frequent product returns. High return rates significantly decrease companies’ profit which makes the issue of managing product returns very important from the practical standpoint. Typically, practitioners study returns in connection with purchase decisions or as a part of customer behavior/type. In this paper, we show that the events which precede the purchase decision are related to the return decision. Generally, this information is readily available to online retailers and thus provides a low-cost opportunity to better understand and predict the product returns. Based on the data provided by a large apparel retailer, we demonstrate that the way customers search for a product is indicative of product returns. We find correlational evidence that using search filters, spending more time, and purchasing the last item searched are negatively associated with the probability of return. We propose a joint model of search, purchase and return which is based on an analytic model of search, purchase, and returns. Our model is consistent with the findings in the data and provides insight into how search and returns are related. Finally, using a machine learning framework, we demonstrate that adding search data improves the prediction accuracy of individual-level return rate above and beyond prior models. S.M. 2022-08-29T16:38:21Z 2022-08-29T16:38:21Z 2022-05 2022-06-09T14:33:30.157Z Thesis https://hdl.handle.net/1721.1/145177 In Copyright - Educational Use Permitted Copyright MIT http://rightsstatements.org/page/InC-EDU/1.0/ application/pdf Massachusetts Institute of Technology |
| spellingShingle | Ibragimov, Marat Customer Search and Product Returns |
| title | Customer Search and Product Returns |
| title_full | Customer Search and Product Returns |
| title_fullStr | Customer Search and Product Returns |
| title_full_unstemmed | Customer Search and Product Returns |
| title_short | Customer Search and Product Returns |
| title_sort | customer search and product returns |
| url | https://hdl.handle.net/1721.1/145177 |
| work_keys_str_mv | AT ibragimovmarat customersearchandproductreturns |