Live-streaming selling considering consumer returns: manufacturer’s choice of streamer types and return freight insurance policies

The prevalence of live-streaming selling greatly impacts consumer returns, which forms an urgent challenge for manufacturers to implement return freight insurance (RFI) policies and live-streaming operations appropriately. In the paper, we establish a supply chain where a manufacturer deploys an employee or influencer streamer to sell products on a live-streaming platform and introduces three kinds of RFI policies, namely no-RFI (NRFI) policy, manufacturers-RFI (MRFI) policy, and consumers-RFI (CRFI) policy. Given that the interaction-perception efficiency of streamers may positively or negatively affect the return rate, we explore the choice of streamer types and RFI policies, yielding several significant findings. First, with the MRFI policy, the manufacturer should deploy an influencer streamer at a low MRFI fee and high residual value; otherwise, it should deploy an employee streamer. Second, with the CRFI policy, the manufacturer should deploy an influencer streamer at a high CRFI fee or high product residual value; otherwise, it should deploy an employee streamer. Finally, regardless of which streamer is deployed, the manufacturer consistently adopts the MRFI policy at a low MRFI fee. However, when the MRFI fee exceeds a certain threshold, the CRFI fee and the interaction-perception efficiency affect the choice between CRFI and NRFI policies.