An Investigation of Cognitive, Emotional and Negative Behavioural Responses to Service Recovery Strategies

Despite the best intentions of service providers and organisations, service delivery is rarely error-free. While numerous studies have investigated specific cognitive, emotional or behavioural responses to service failure and recovery, these studies do not fully capture the complexity of the services encounter. Consequently, this research develops a more holistic understanding of how specific service recovery strategies affect the responses of customers by combining two existing models—Smith & Bolton’s (2002) model of emotional responses to service performance and Fullerton and Punj’s (1993) structural model of aberrant consumer behaviour—into a conceptual framework. Specific service recovery strategies are proposed to influence consumer cognition, emotion and behaviour. This research was conducted using a 2x2 between-subjects quasi-experimental design that was administered via written survey. The experimental design manipulated two levels of two specific service recovery strategies: compensation and apology. The effect of the four recovery strategies were investigated by collecting data from 18-25 year olds and were analysed using multivariate analysis of covariance and multiple regression analysis. The results suggest that different service recovery strategies are associated with varying scores of satisfaction, perceived distributive justice, positive emotions, negative emotions and negative functional behaviour, but not dysfunctional behaviour. These finding have significant implications for the theory and practice of managing service recovery.

Comparing the diffusion of online service recovery in small and large organisations

A key concern organisations face is how to incorporate Internet tools into their marketing communications mix. Where and how should companies invest their human, technological and financial resources? This paper explores a subset of this problem, online complaining and electronic customer service. It applies diffusion of innovation as a theoretical framework to investigate organisational implementation of email technology and explain the outcome of annual customer service surveys in 2001, 2002 and 2003. The results add to the small body of research on electronic service recovery by extending diffusion of innovations to email service recovery and underscoring the importance of adoption phases, particularly for SMEs. Larger companies provide more channels for submitting complaints, which represents an early phase of adoption. There was little difference in how large and small companies respond to online complaints, a later phase of adoption.

The CURE scale: a multidimensional measure of service recovery strategy

Purpose – This paper aims to address the gaps in service recovery strategy assessment. An effective service recovery strategy that prevents customer defection after a service failure is a powerful managerial instrument. The literature to date does not present a comprehensive assessment of service recovery strategy. It also lacks a clear picture of the service recovery actions at managers’ disposal in case of failure and the effectiveness of individual strategies on customer outcomes. Design/methodology/approach – Based on service recovery theory, this paper proposes a formative index of service recovery strategy and empirically validates this measure using partial least-squares path modelling with survey data from 437 complainants in the telecommunications industry in Egypt. Findings – The CURE scale (CUstomer REcovery scale) presents evidence of reliability as well as convergent, discriminant and nomological validity. Findings also reveal that problem-solving, speed of response, effort, facilitation and apology are the actions that have an impact on the customer’s satisfaction with service recovery. Practical implications – This new formative index is of potential value in investigating links between strategy and customer evaluations of service by helping managers identify which actions contribute most to changes in the overall service recovery strategy as well as satisfaction with service recovery. Ultimately, the CURE scale facilitates the long-term planning of effective complaint management. Originality/value – This is the first study in the service marketing literature to propose a comprehensive assessment of service recovery strategy and clearly identify the service recovery actions that contribute most to changes in the overall service recovery strategy.

Relationship marketing and pay TV: satisfaction, complaining behavior, service recovery, and repurchase

The aims of this research included demonstrating the detenninants of Pay TV subscriber satisfaction, and displaying the relationships between key aspects of relationship marketing, such as perceptions of value, satisfaction, customer complaint behavior and service recovery, and the intention to repurchase. A survey of 171 Australian respondents suggested that the perceived quality of the variety of the programs available and the perceived quality of the monthly program guide were major contributors to value, and that value was the main driver of overall satisfaction, which in tum was the main driver of the likelihood of disconnection from the Pay TV service. Those respondents who reported having a problem but not complaining directly about it were significantly more likely to have the intention to disconnect in the future, but they were not significantly different in tenns of their value perceptions or overall satisfaction.

Proposed multi-dimensional approach to evaluating service recovery

Purpose – The purpose of this paper is to extend thinking on service recovery processes and satisfaction with service recovery, using multi-dimensional consumer outcomes. The objective of the work was to propose that satisfaction with service recovery should be based on customers' expectations of the recovery encounter, which would be shaped by their expectations of “non-failed” encounters.

Design/methodology/approach – The paper adopts a theoretical approach. Using the existing service recovery literature as well as the traditional services literature, the conceptual framework and associated research propositions are developed.

Findings – The proposed framework suggests that service recovery is a service encounter it its own right. The effectiveness of recovery encounters will be based on how encounters operate relative to customer expectations and experiences with regard to the recovery activity.

Research limitations/implications – The research propositions and proposed framework need further empirical investigation.

Practical implications – The proposed framework suggests that managing service recovery should be undertaken in a similar fashion to managing any service, and thus managers need to understand customers' recovery expectations. Organisations also need to consider how a recovery action impacts on a range of customer outcomes, as focusing on one aspect will not capture consumers' full set of behaviours.

Originality/value – The proposed model identifies that service recovery should be evaluated with regard to consumers' recovery expectations and satisfaction is not based on expectations with regard to non-failed encounters.

Do organizational service recovery actions impact on hotel guests future intentions and does speed of recovery matter?

This paper investigates hotel guests’ responses to organizational actions dealing with service failure. Eight service failure scenarios were used to identify guests’ intentions towards future visits. Guests’ intentions to switch hotels, revisit the property and remain loyal to the chain were found to vary based on the recovery efforts undertaken. This research found that empowering employees contribute to positive consumer intentions toward the service provider. Compensation was also found effective if offered through empowered employees. Speed of response to service failure was also identified as important action to improve consumer future intentions. Based on these findings, implications for future research are highlighted. Recommendations to the practitioners of hospitality and tourism sector were made for the management of failed service encounter.

Effects of differential methods of compensation and employee empowerment on customer satisfaction and loyalty in service recovery

This research examined the effects of varying compensation (refund and replacement) and employee empowerment (empowered and non-empowered) in service recover situations, using a 2x2 experiment. Analysis was undertaken using mean contrasts and ANOVA's. Findings suggest that empowerment and refund independently impact on post recovery consumer loyalty and satisfaction, but there is no interaction effect.

Role of organizational service recovery actions on sustomer switching intentions in a process based service failure : does speed of recovery matters?

The study examines how organizational activities of compensation and empowerment impact on consumers switching intentions and also whether these differ based on the speed of service recovery. Data is collected using hypothetical scenarios in a situation of process failure. It is found that there is no direct effect of either compensation or empowerment on switching intent, although the interaction effect is significant when recovery occurs quickly.

Service recovery in a service guarantee context

This study employed a 2 x 2 full-factorial, between-subjects design experiment examining the influence of service failure severity and fix on hotel guests’ satisfaction following invocation of a service guarantee. The study involved a sample of 130 online panel members. As expected, guests are less dissatisfied following a minor (versus a major) service failure while satisfaction is enhanced when the problem is corrected. Surprisingly, fix has a stronger influence on satisfaction when a severe failure occurs, and satisfaction evaluations are approximately equal regardless of the severity of the failure when the problem is fixed.

The influence of guarantee compensation and fix on service recovery

This study employed a 3 x 2 full-factorial, between-subjects design experiment examining the influence of service guarantee compensation and fix on hotel guests’ satisfaction following invocation of a service guarantee. The study involved a sample of 390 online panel members. As expected, satisfaction is enhanced when the problem is corrected, however overcompensating guests beyond what was initially promised does not enhance satisfaction evaluations. Increasing compensation from the low to the medium (promised) level results in stronger satisfaction ratings when the problem is fixed versus when it is not.

Justice-based service recovery in a service guarantee context

Although many service organisations have committed resources to developing service guarantee programmes, empirical research assessing their influence of consumers' post purchase evaluations is limited. This thesis addresses this deficiency in the guarantee literature by adapting and extending an established model of perceived justice and consumer satisfactionto the service guarantee context.