Institute of Transportation, MOTC

Xin-Hua Sun, 2008.06
Institute of Traffic and Transportation National Chiao Tung University

　　The internet represents a growing and huge market. The development of e-commerce is an efficient business model which enables new relationship between consumers and suppliers. In particular, the B2C market in Taiwan is expected to reach NT $138.5 billion with 38% increase in 2008. The E-retailing is obviously becoming a noticeable market. However, as the market grows and matures, “return” becomes one of the challenges for E-tailers. In the past, most of the literature on return issues focused on the wholesaler-retailer relationship. Recently, due to the advent of Internet-based retailing within the past decade, attention is shifting to the issue of returns in the retailer-consumer relationship.

　　In this study, we use empirical data and conduct a Decision Tree model to analyze the critical variables revealing the customer return propensity. There are 3 dimensions of variables in our data set- customer demographic variables, merchandise variables and service variables.

　　We find that three variables- category, price and delivery days could be used to distinguishing customer return propensity more effectively. In accordance with these variables, we propose some strategies for website managers to control returns in E-retailing.