Company News • 15.12.2014

Too many returns this holiday?

How loyal customers can hurt sales

Many people have strong habits when it comes to shopping, preferring favorite stores and favorite brands. But a new study in the Journal of Marketing Research suggests that these same shoppers may have hidden habits that are hurting sales.

“Evidence suggests the existence of customer habits, beyond repeat purchases, that have serious implications for profits and firm performance. Whereas repeat purchase habits have been studied and shown to have a positive impact on sales, there are other common habits which have a notably negative effect on a company’s bottom line,” write authors Denish Shah, V. Kumar, and Kihyun Hannah Kim of Georgia State University.

Authors examined the habits of customers at a major national chain store to see whether they exhibited habits beyond simply coming back to the store and repeatedly buying the same products. They found that a significant percentage of customers had a strong habit of returning products, or a habit of buying items only if they were on sale. The authors found this very significant, because many of the same customers who were thought to be helping the company through repeat purchases were actually hurting the company by returning products, or by rarely buying products at full price.

The authors suggest that a high level of returns may require the introduction of a more stringent return policy, and that if many customers only buy items when they’re on sale, the company may need to examine its overall pricing policy. The authors warn, however, that people with strong habits are the most likely to resent change, and decisions must be made carefully to avoid driving these customers to competing stores.

“It is possible for managers to analyze how habit-prone their customers are, and then work on a marketing strategy that helps to cultivate customer habits which benefit the company, and deter habits which hurt it,” the authors conclude.

Source: American Marketing Association (AMA)

related articles:

popular articles:

Thumbnail-Photo: Blockchain: Protecting the retail sector from counterfeit products...
09.04.2019   #security #customer relationship management

Blockchain: Protecting the retail sector from counterfeit products

Fake products reduce consumer confidence in a brand

What if something would allow manufacturers, retailers and customers to verify at any time that a product on the shelf is authentic?Counterfeit products often look deceptively like the real deal, but the quality is inferior to the original goods and ...

Thumbnail-Photo: Today’s supply chain threats: tariffs, terrorists and tsunamis...
16.07.2019   #security #supply chain management (SCM)

Today’s supply chain threats: tariffs, terrorists and tsunamis

Agile strategies required to combat potential supply chain disruptions

The recent increases – and threat of increases – in tariffs are causing disruptions to today’s retail supply chains. According to a new report from BRP: ‘Tariffs, Terrorists & Tsunamis: Minimize the Impact of Supply Chain ...

Thumbnail-Photo: Changing consumer demands challenge European retailers...
23.05.2019   #customer analysis #promotions

Changing consumer demands challenge European retailers

Increasing consumer returns purchases during short-term promotions

Retail analytics guidance system, DynamicAction, has launched its Retail Index: Spring 2019 data, providing an overview of the challenges facing European retailers as they adapt to changing consumer expectations and an evolving retail landscape.The ...

Thumbnail-Photo: Supply chain transparency is good for business...
27.05.2019   #customer satisfaction #delivery

Supply chain transparency is good for business

The report by ICAR makes the case that greater transparency improves brands’ reputations.

A new report by the International Corporate Accountability Roundtable (ICAR) makes the business case for companies to adopt greater supply chain transparency measures, showing that when they do, businesses enjoy better reputations, greater ...

Thumbnail-Photo: Transport logistic trend barometer 2019
11.04.2019   #logistic systems #economy

Transport logistic trend barometer 2019

Economic situation, Brexit, digitalization—logistics feels ready for the challenge

In spite of many political and economic uncertainties as well as numerous business challenges ranging from the lack of skilled personnel to digitalization, the logistics industry is confident that it will meet the challenges. Companies are getting ...

Thumbnail-Photo: LogiMAT China a big hit in Shanghai
29.04.2019   #logistic solutions #event

LogiMAT China a big hit in Shanghai

Attendees impressed by new location offering unique synergies

LogiMAT China 2019, which ends on April 17, drew impressive numbers of exhibitors and visitors following its move from Nanjing to Shanghai. The idea to host the intralogistics trade show alongside transport logistic China forum, organized by Messe ...

Thumbnail-Photo: Start-up offering consumers free same-day delivery...
09.07.2019   #customer satisfaction #logistics

Start-up offering consumers free same-day delivery

New online service for online shopping convenience with no membership fees

A new e-commerce company called Waybuy is changing the way consumers shop online, combining the best in convenience and affordability to make it easier than ever to get the products shoppers need.Founded by Houston-area married couple, Ann and Erik ...

Thumbnail-Photo: Sustainable delivery routes in neighborhoods...
22.03.2019   #sustainability #delivery

Sustainable delivery routes in neighborhoods

Farmstead plans with customer groups and delivery windows

Farmstead, an online grocer, announced the launch of its weekly Sustainable Routes to reduce the amount of vehicles on the road, reducing carbon emissions and Farmstead’s delivery costs. The savings are passed on to customers in the form of ...

Thumbnail-Photo: Blockchain traceability in olive oil supply chain...
03.07.2019   #supply chain management (SCM) #monitoring software

Blockchain traceability in olive oil supply chain

Blocksyte and Caroli share results of monitoring application

Blocksyte, a SaaS-based blockchain supply chain application company focused on the food industry supply chain, and Caroli, producer of extra virgin olive oil, announced the successful introduction of end-to-end blockchain traceability into the olive ...

Thumbnail-Photo: “Worldwide shipping: I need it - now!“
24.06.2019   #e-commerce #logistic solutions

“Worldwide shipping: I need it - now!“

Helping eCommerce businesses succeed through international shipping

Micha Augstein, CEO and founder of shipping service provider PARCEL.ONE GmbH is on a mission. He wants to revolutionize online retail with his innovative logistics approach and support online retailers.How does he do it? Retailers simply send their ...

Supplier

EUROEXPO Messe- und Kongress-GmbH
EUROEXPO Messe- und Kongress-GmbH
Joseph-Dollinger-Bogen 9
80807 München