Retail Save the Sale tactics: Consumer perceptions of in-store logistics service recovery

To prevent customers from leaving stores empty-handed when encountering a stockout, retailers increasingly leverage their inventory visibility and order fulfillment capabilities to implement save the sale tactics. Retailers have several logistics service options available in designing save the sale stockout recovery initiatives: buy at store-ship from (different) store and the buy at store-ship from DC, leading to different order fulfillment speeds. In addition, there is the home delivery approach, which is generally more convenient to customers than the option of store delivery for customer pick-up. In this paper, we explore how customers evaluate and respond to varying elements of these save the sale stockout recovery services when experiencing an in-store stockout. Building on justice theory and literatures on service recovery and impression formation, we develop a series of four experiments. We explain and provide empirical evidence for (1) why and how customers assess specific stockout service recovery dimensions (i.e., order fulfillment speed and delivery location) as more just, (2) how customers appraise the justice of these bundled stockout recovery dimensions, (3) how purchase involvement and monetary offers impact these perceptions, and (4) how justice perceptions and stockout recoveries impact the likelihood of saving the sale.

Automated summary

This study investigates how customers evaluate and respond to different dimensions of stockout recovery services when encountering stockouts in stores. The results suggest that order fulfillment speed and delivery location significantly influence customer evaluation, while purchase involvement and monetary offers impact their perceptions. There is a complex relationship between justice perceptions, stockout recoveries, and the likelihood of saving the sale.