Omnichannel retailing has changed the way consumers shop, yet product returns remain a costly challenge. Conventional wisdom holds that adding sales channels provides better information about product fit and should help reduce returns. However, it is unclear how shopping experience across multiple channels influences what consumers buy and whether they return those purchases. There is also no clear consensus on why return rates increase in some omnichannel contexts but not others. We address this knowledge gap by focusing on consumers’ multichannel experience (MX) rather than mere channel adoption, and distinguishing two types of MX: remote-only (those who have used only non-physical channels like online and catalog) versus hybrid (those who have used both non-physical and physical channels). We empirically analyze over 292,000 transactions from a European furniture retailer operating showroom, online, and catalog channels. Using a series of fixed-effects regressions with Heckman selection to address potential channel-selection bias, a control function approach to account for endogeneity due to omitted variable bias associated with MX, and a parallel mediation analysis, we find that consumers with MX are significantly more likely to return products than their counterparts with only single-channel experience (SX) (i.e., showroom, online, or catalog). This elevated return propensity is largely driven by MX shoppers’ greater tendency to buy niche products and experience goods, which carry higher uncertainty and return risk. Moreover, consumers with remote-only MX exhibit higher return rates than those with hybrid MX, and this gap is especially pronounced among consumers living farther from a physical showroom store. We conduct multiple robustness checks to verify the results. We also replicate the main findings with a new transaction data set from a U.S. retailer (leveraging a natural experiment). Theoretically, our work challenges assumptions that multichannel access inherently lowers returns, highlighting how MX can increase return risk through its effect on purchase behavior. Managerially, our findings inform product–channel matching strategies and omnichannel design, and point to targeted interventions based on consumer type (remote-only vs. hybrid) and geography (distance to stores) to ameliorate returns.
Stanley Frederick W. T. Lim (Tue,) studied this question.