Does Service Failure Context Matter? Customers’ Response to Service Recovery

Abstract

Because service failures are difficult to avoid in the services context due to their characteristics, firms need to offer an adequate service recovery to compensate customers. Customer behavior may be affected either by the failure or its recovery. The purpose of this study is to explore the impact of service failure severity in customers' post-recovery behavior. The study comprises a sample of 40,813 customers, representing customers who had experienced a problem with the service provider and customers who had not. Empirical results showed that service failure severity has a significant negative influence in customers' post-recovery repurchase behavior. Nevertheless, the influence differs across customers' relationship age with the service. Additionally, they also provide evidence of when service recovery paradox is more likely to occur. This study contributes with relevant insights for practitioners. Since failure severity affects negatively customers' post-recovery repurchase behavior, the classification of service failures by degree of severity is commended. Hence, firms should adopt different service recovery strategies depending on failures severity degree and customers' relationship age with the firm. Customers' segmentation should consider these characteristics in order to enhance complaints management and customer loyalty.

Customer responses to airline companies' service failure and recovery strategies: the moderating role of service failure habit

“…Evidence from this study showed that PSSF had positively influenced customer NWoM regardless of airline carrier. This finding is in line with the results of a number of previous studies (McColl-Kennedy et al, 2003;Soares and Proenc ¸a, 2015), especially those of Yildirim et al (2018) who likewise found that dissatisfied customers would engage in NWoM after an initial service failure.…”

“…Numerous studies have highlighted the effect of PSSF on various service failure outcomes, such as loss of customer loyalty and reduced re-purchase intention (Li, 2015). Soares and Proenc ¸a (2015) reported that service failures had had a strong negative impact on a firm's relationship with its customers. In this regard, Ozuem et al (2021) showed that SRSs are critical in reducing customer desire to switch to alternative service providers.…”

“…Only one previous study had offered insight into the possible relationship between PSSF and NWoM. In their study, Soares and Proenc ¸a (2015) noted that the severity of service failure had negatively affected the post-recovery behaviour of affected customers. Along these lines, it is reasonable to treat NWoM as a post recovery behaviour, and to assume that the more intense the service failure, the greater the customer would want to denigrate the transgressing service provider to others.…”

Managing Consumer Anger And Consumer Forgiveness Through Service Recovery Strategies In Transportation Sector

“…Gronroos suggested that service providers take some action after service failure as consumer's expectation related to the services does not match the delivered (Grönroos, 2007;Harrison-Walker, 2019a).The paradox of service recovery has importance with the condition that the customer becomes more satisfied after service recovery than those who have not such failure experience (Soares & Proença, 2015;Yunus, 2023).Previous studies suggested that after service failure, customers have feelings of injustice and they expect to restore the feelings of justice (Suri et al, 2019). The service failure which may cause cost or material damage to the customer might increase the need for recovery strategies like empathy and continuous concern whereas for the customer who responds to emotions like anger immediate correction and apologies recovery strategies can be adopted (Bakar et al, 2019).…”

Airline Service Failure

“…In an earlier study by Smith et al (1999), it was stated that the service failure severity significantly affects the impression the consumers have toward the service provider. Besides, it will also trigger unfavorable behavioral actions such as consumer complaints, negative word-of-mouth (WOM), and service termination or switching to other service providers (Soares & Proença, 2015). In addition, the severity of service failure will also have adverse effects on business outcomes, such as loss of customers and a decrease in revenue (Keiningham et al, 2014).…”