An empirical analysis on the influence of risk on relationships between handling of product returns and customer loyalty in E-commerce

Using data from online customer ratings, we explore how the relationships between performance of companies in handling product returns and customer loyalty are affected by risk characteristics of products. Our results show that handling product returns plays an important role in shaping customer loyalty for low-risk products and also for high-risk products but not for products that exhibits medium levels of risk. These results have implications for website managers and development of reverse-logistics channels in the internet supply chains.