In the retail industry the return of products by customers (customer returns) is common and problematic, as it lowers the profits of both retailers and manufacturers. Most research in this area deals with unsold inventory and the corresponding returns policies but does not include the impact of returned products from customers on pricing. In this research, we develop models to investigate the use of revenue management (RM) to mitigate the negative impact of customer returns. Starting with the problem of a firm that faces customer returns, we address the simultaneous determination of price and inventory replenishment for cases when the quantity of returned products is a function of both the quantity sold and the price, in single- and multi-period models with and without uncertainty in demand. Then we extend the research to a supply chain setting and investigate the impact of customer returns on the retailer's pricing and ordering decisions as well as on the manufacturer's wholesale price, with and without a buyback policy. In the last part of the research, we identify customer returns as an innovative approach to segment a market. We address how a firm and the supply chain enhance profit through such market segmentation:​ in a returnable market, the firm or the retailer accepts customer returns, while in a nonreturnable market, the firm or the retailer does not.