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Abstract:

This study examines the differential impact of perceived risk upon two alternative channels of distribution, namely specialty store and mail-order buying, for different product categories. Given the critical role of perceived risk in limiting mail-order buying different types of risk relievers and their potential for reducing perceived risk have been analyzed. This study confirms the general belief that mail-order buying is not only more risky than buying the same product in a specialty store but it also indicates "that the level of perceived risk seems to be highly influenced by the value of the product. Although mail-order companies may reduce this competitive disadvantage by using the appropriate risk relievers the results clearly indicate that risk relievers differ considerably in effectiveness. "Money-back guarantee" and "offering products with positive ratings of consumer organizations" are among the better risk relievers.