How return policy leniency affects customer patronage in online retailing: moderating roles of novelty seeking and collectivism

Global online retailers are struggling to handle product returns and increase customer patronage using return policy leniency, but research on how that happens and under what conditions remains unclear. This study examines the psychological process through which return policy leniency drives customer patronage across Western and Eastern cultures. Based on two surveys in the major Western (355 United States customers) and Eastern (258 Chinese customers) e-tail markets, results show that perceived control, perceived relatedness, and customer satisfaction fully mediate the effect of return policy leniency on customer patronage in Western culture. Perceived relatedness and customer satisfaction partially mediate the effect of return policy leniency on customer patronage in Eastern culture. Moreover, novelty seeking negatively moderates the effect of return policy leniency on perceived control in Western culture, while collectivism negatively moderates the effect of return policy leniency on perceived relatedness in Eastern culture. This study enriches our understanding of customer psychological processes in responding to return policy leniency across different cultures.