Consumer reactions to the adoption of green reverse logistics

Abstract

Firms are beginning to find that the adoption of certain reverse logistics practices may offer a lucrative approach to greening their supply chain. Consisting of remanufacturing, reusing, and recycling, this idea of green reverse logistics is currently being diffused throughout the supply chain. A recently published logistics diffusion model with its basis in resource-advantage theory suggests that a logistics innovation is more likely to be adopted if it enhances competitive advantage for the firm considering adoption. Our study uses diffusion of innovation and resource-advantage theories as a foundation to investigate consumer reactions to firms that implement green reverse logistics practices. We investigate whether a firm's adoption of green reverse logistics leads to higher levels of consumer loyalty and a willingness to pay more for the firm's products. Our findings suggest that consumers' satisfaction with firms that adopt green reverse logistics leads to increased levels of loyalty to the firm, which leads to a willingness to pay more for a firm's products. The results of this empirical study are discussed, including theoretical and practical implications and recommendations for future research.

Keywords:

• green logistics
• reverse logistics
• diffusion of innovation
• resource-advantage
• structural equation modeling