Would compensation be necessary? The importance of service recovery strategy in e-retail delivery problems

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Erlinda Nusron Yunus
Keyword(s):  
Service Failure ◽  
Service Recovery ◽  
Recovery Strategy ◽  
Content Type ◽  
Repurchase Intentions ◽  
Subsequent Test ◽  
Service Failures ◽  
Recovery Strategies ◽  
Online Shoppers ◽  
The Impact

PurposeThis study examines the different effects of service recovery strategies on customers' future intentions when online shoppers were experiencing delivery failures. Two types of problem severity are evaluated: wrong-product delivery (issues with the product quality or quantity) and late delivery. This study also investigates the impact of service criticality on the relationship between service recovery strategies and customers' future intentions.Design/methodology/approachThis study employs experimental research with 123 online shoppers as participants. Following the results, a subsequent test is conducted to examine the effect of participants' demographics on future intentions. Finally, the current study elaborates the findings using qualitative research, interviewing both sides impacted by the service failures: online shoppers and e-retail managers.FindingsThe findings show that complementing product replacement with monetary compensation is the most effective strategy to improve repurchase intention after a dissatisfaction moment. This effect is indifferent to service criticality and severity. Age influences the participants' repurchase intentions, in which younger people are less tolerant of service failures. In contrast, gender and education level do not provide any differences. To prevent delivery failures, managers participating in this study suggest several best practices regarding systems and infrastructure, people and coordination and collaboration with logistics partners.Research limitations/implicationsThe study mainly examines a limited type of service and service failures. Further studies are encouraged to expand the variables and scenarios, as well as to employ more distinctive methods, to enrich the findings related to recovery strategy in the e-commerce industry.Practical implicationsGiven proper compensation, service failure could create momentum for online retailers to boost customer loyalty. This study suggests that managers design the most effective service recovery to win customers back to the business.Originality/valueThis paper enriches the literature related to a service recovery strategy, particularly within the online shopping context.

When service failure leads to sin

2018 ◽  
Vol 28 (4) ◽  
pp. 410-433 ◽  
Author(s):  
Yit Sean Chong ◽  
Pervaiz K. Ahmed
Keyword(s):  
Religious Identity ◽  
Critical Incident ◽  
Service Providers ◽  
Service Failure ◽  
Belief Systems ◽  
Service Recovery ◽  
Dietary Guidelines ◽  
Content Type ◽  
Recovery Strategies ◽  
The Impact

Purpose The purpose of this paper is to examine the notion of “service transgression” which violates customers’ religious beliefs through observing certain dietary guidelines that shape their religious identity. While service transgression and customer forgiveness are predominantly examined using experimental procedures or questionnaire survey in existing studies, this study adopts an interpretive paradigm to explore the complexities and idiosyncratic narratives of individual perceptions. Design/methodology/approach Detailed narrative accounts of 15 participants consisting of five Muslims, five Buddhists and five Hindus; who are working adults residing in Malaysia were gathered via in-depth interviews. Critical incident technique was employed with interpretive approach being undertaken to uncover key themes that form the essence of experiences in service transgressions. Findings The responses from participants were mainly contingent to the individuals’ interpretations of their religious expectations in the assessment of the incidents. Observations from the interview protocols reveal common themes in the consideration of whether one has indeed transgressed against the religious norms, the assignment of blame and responsibility and reparation of relationships. From the findings of this study, the authors developed a typology of conflict framing categories: “damaged identity”, “identity at risk” and “identity preservation” by considering both dyadic and triadic service relationships in service failure incidents which involve a violation of customers’ religious belief systems. Practical implications The outcome of this study seeks to inform service providers on the impact of service transgression of this nature upon consumers particularly in a multi-faith society. Additionally, this study provides insights into the implementation of service recovery strategies if and when such situation arises. Originality/value By undertaking a narrative enquiry, this study uncovers personal sense making in this phenomenon within the contextual frame of societal and historical norms. The outcome of this study provides insights to service providers on the impact of service transgression upon consumers particularly in a multi-faith context such as Malaysia. Additionally, this study discusses managerial implications associated with the implementation of service recovery strategies if and when such situation arises.

Service recovery satisfaction in offline and online experiences

2019 ◽  
Vol 38 (1) ◽  
pp. 1-14
Author(s):  
Raphael Odoom ◽  
George Cudjoe Agbemabiese ◽  
Robert E. Hinson
Keyword(s):  
Service Providers ◽  
Service Failure ◽  
Service Recovery ◽  
Content Type ◽  
Service Failures ◽  
Service Failure And Recovery ◽  
Recovery Strategies ◽  
Recovery Satisfaction ◽  
Empirical Tests ◽  
Service Managers

Purpose Given that the peculiar nature of the internet has introduced new dimensions of service delivery as well as new dimensions of service failures and recovery, the purpose of this paper is to investigate and compare the relationships between recovery strategies and recovery satisfaction within offline and online settings. Design/methodology/approach Data for the empirical tests of our hypotheses were collected via offline and online (specifically Facebook and Twitter) samples of customers who have experienced some form of service failure and recovery measures from service providers within the past year. Findings The results indicate that recovery strategies largely influence recovery satisfaction among aggrieved customers. However, these are conditional and not invariant across the two settings. In the authors’ offline setting, in particular, apology did not show a statistically significant impact on recovery satisfaction, even though, along with compensation and explanation, this relationship was significant among the online sample. Originality/value The study offers practical implications for service managers within emerging economies on the various conditions where they can maximise their service recovery efforts (both offline and online) to generate optimum recovery satisfaction.

scholarly journals Customer intentions to invoke service guarantees

2014 ◽  
Vol 24 (1) ◽  
pp. 45-62 ◽  
Author(s):  
Yves Van Vaerenbergh ◽  
Arne De Keyser ◽  
Bart Larivière
Keyword(s):  
Service Providers ◽  
Service Recovery ◽  
Content Type ◽  
Service Failures ◽  
Service Guarantees ◽  
Recovery Strategies ◽  
Service Guarantee ◽  
Quasi Experimental ◽  
The Impact ◽  
Customer Outcomes

Purpose – Many service providers feel confident about their service quality and thus offer service guarantees to their customers. Yet service failures are inevitable. As guarantees can only be invoked when customers report service failures, firms are given the opportunity to redress the original failure potentially influencing customer outcomes. The purpose of this paper is to provide the first empirical investigation of whether excellence in service recovery affects customers’ intentions to invoke a service guarantee, thereby discriminating between conditional and unconditional guarantees and testing for the impact of customers’ individualistic vs collectivistic cultural orientation. Design/methodology/approach – In total, 171 respondents from four continents (spanning 23 countries) were recruited to participate in a quasi-experimental study in a hotel setting. A three-way analysis of variance was used to test the hypotheses. Findings – All customers are very likely to invoke the service guarantee after an unsatisfactory service recovery. When customers are satisfied with the service recovery, they report lower invoke intentions, except for collectivistic individuals who are still inclined to invoke an unconditional service guarantee after a satisfactory service recovery. The finding supports an in-group/out-group rationale, whereby collectivists tend to behave more opportunistically toward out-groups than individualistic customers. Originality/value – The study highlights the importance of excellence in service recovery, cultural differences and different types of service guarantees with respect to customers’ intentions to invoke the guarantee. The paper demonstrates how service guarantees should be designed in conjunction with service recovery strategies. Also, the paper shows that an unconditional service guarantee creates the condition in which collectivists might engage in opportunistic behavior; global service providers concerned about opportunistic customer claiming behavior thus might benefit from using conditional service guarantees.

The impact of CSR-linked sport sponsorship on consumers’ reactions to service failures

2019 ◽  
Vol 21 (1) ◽  
pp. 70-90 ◽  
Author(s):  
Daehwan Kim ◽  
Yongjae Ko ◽  
J. Lucy Lee ◽  
Yong Cheol Kim
Keyword(s):  
Attribution Theory ◽  
Service Providers ◽  
Service Failure ◽  
Halo Effect ◽  
Sport Sponsorship ◽  
Content Type ◽  
Repurchase Intentions ◽  
Service Failures ◽  
Positive Attitudes ◽  
The Impact

Purpose Drawing on the corporate association framework and attribution theory, the purpose of this paper is twofold: first, to examine the shield effects of CSR-linked sport sponsorship on consumer attitudes toward a sponsor, attribution patterns in a sponsor’s service failure and repurchase intentions and second, to investigate the halo effect of CSR-linked sport sponsorship on corporate ability (CA) associations and the relationship between CA associations and consequential variables in the context of service failure. Design/methodology/approach A scenario-based two-factor (sponsorship types: baseline vs sport sponsorship vs CSR-linked sport sponsorship × service failure types: flight delay vs cancellation) experimental design was employed. Findings The results indicate that CSR-linked sport sponsorship outperforms non-CSR sport sponsorship in forming CSR association and developing CA association. Both CSR and CA associations are found to positively influence the consumer’s attitude toward a service provider. Consumers with positive attitudes attribute the sponsor’s service failure to external factors, leading to repurchase intention after a service failure. Originality/value This study connects two fields of research, service failure and sport sponsorship, thereby providing evidence on how CSR-linked sport sponsorship can play a shield role in the context of service failure and whether CSR-linked sport sponsorship can be a proactive strategy for service providers in industries where service failures are inevitable. Additionally, this study provides empirical evidence on whether CSR-linked sponsorship can lead consumers to perceive service quality as “doing right leads to doing well” by creating a halo effect.

#IHateYourBrand: adaptive service recovery strategies on Twitter

2017 ◽  
Vol 31 (3) ◽  
pp. 281-294 ◽  
Author(s):  
Alexandra K. Abney ◽  
Mark J. Pelletier ◽  
Toni-Rochelle S. Ford ◽  
Alisha B. Horky
Keyword(s):  
Social Media ◽  
Service Failure ◽  
Service Recovery ◽  
Academic Research ◽  
Unique Challenge ◽  
Content Type ◽  
Service Failure And Recovery ◽  
Recovery Strategies ◽  
Use Of Social Media ◽  
The Impact

Purpose Social networks offer consumers the ability to voice their opinions of brands in a real-time, public setting. This represents a unique challenge for firms as brand managers must develop new strategies for properly communicating with consumers, especially in the event of a service failure. The purpose of this research is to explore the impact of various adaptive service recovery strategies via social media, specifically Twitter. Design/methodology/approach Through a series of experimental manipulations, four service recovery strategies are tested alongside two variations of consumer complaint tweets. The service recovery responses vary in their degree of adaptiveness, which have differential impacts on numerous consumer outcome variables. Findings The findings indicate that highly adaptive recoveries responses positively impact consumers’ evaluations of service recovery satisfaction, leading to greater consumer behavioral intentions. Additionally, the type of tweet the consumer sends may further reveal their expectations for adequate service recovery responses. Originality/value This study is the first to empirically test the use of social media platforms in the service failure and recovery context. Although social media is commonly used for such purposes by practitioners, academic research up to this point has predominately focused on social media for generating word-of-mouth. Further, this study seeks to examine how service adaptability is perceived from the customer perspective, as opposed to the more traditional employee viewpoint.

scholarly journals Customer’s repurchase intensions following service recovery: A conceptual model

2021 ◽  
Vol 124 ◽  
pp. 09006
Author(s):  
Muhammad Mazhar ◽  
Ting Ding Hooi
Keyword(s):  
Service Failure ◽  
Service Recovery ◽  
Effective Strategy ◽  
Recovery Strategy ◽  
Repurchase Intentions ◽  
Comprehensive Service ◽  
Customer Defection ◽  
Recovery Strategies ◽  
Key Driver ◽  
Financial Transactions

An effective strategy of service recovery that prevents customer defection after service failure is a powerful managerial instrument. The values that a customer associates and considers with repurchasing after service recovery has changed due to globalization. Although service recovery has been identified as a key driver to retain the customers, yet the effectiveness of service recovery is unclear. The literature did not offer a comprehensive service recovery strategy that can be implemented universally. Owing to varying comments on the effectiveness of service recovery, its generalizability is questionable. Grudge produced in the response of service failure that cannot be compensated with financial transactions. This study will check whether service recovery has any impact on customer’s repurchase intentions when customer has grudges and available substitutes. The findings of this research will help the managers and practitioners to allocate their resources in a proper way. Furthermore, this study will help to understand money or extrinsic compensation is not everything. Therefore, there will be some consideration beyond the materialist compensation. It will open up new avenues for researchers to view service recovery strategies with a different angle.

When service providers fail: outsourcing help and consumer attitudes

2018 ◽  
Vol 39 (5) ◽  
pp. 22-30
Author(s):  
Aaron Gazley ◽  
Hamish Simmonds
Keyword(s):  
Design Methodology ◽  
Service Providers ◽  
Home Country ◽  
Service Failure ◽  
Service Recovery ◽  
Content Type ◽  
Consumer Ethnocentrism ◽  
The Impact ◽  
Practical Implications ◽  
Delivery Channel

Purpose The purpose of this paper is to investigate the effect of outsourcing and offshoring on brand loyalty in a service recovery context. In addition, the effect that consumer ethnocentrism has on these relationships is examined. Design/methodology/approach An experiment was designed using a series of service recovery scenarios that manipulated whether the recovery effort was conducted by an in-house/outsourced or local/offshored party. Findings The study shows that while outsourcing service recovery within the home country has no effect on loyalty, outsourcing to an offshore location does. In addition, the effect of offshoring of loyalty is greater for consumers who hold ethnocentric tendencies. Practical implications This research suggests the need to consider the delivery channel of service recovery to recover a service failure and retain customer loyalty. The results show that outsourcing within a local country may be effective, but the risks associated with offshoring are much greater. Originality/value Despite previous attempts to understand outsourcing and offshoring in a range of service scenarios, their role in service recovery is not well understood. Similarly, the impact that ethnocentrism might have on this process is overlooked. This paper therefore responds to calls within business theory, practice and consults for further study in this under-researched area.

The CURE scale: a multidimensional measure of service recovery strategy

2014 ◽  
Vol 28 (4) ◽  
pp. 300-310 ◽  
Author(s):  
Rania Mostafa ◽  
Cristiana R. Lages ◽  
Maria Sääksjärvi
Keyword(s):  
Service Failure ◽  
Service Recovery ◽  
Telecommunications Industry ◽  
Comprehensive Assessment ◽  
Response Effort ◽  
Recovery Strategy ◽  
Content Type ◽  
Path Modelling ◽  
Individual Strategies ◽  
Formative Index

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.

Why didn’t it work out? The effects of attributions on the efficacy of recovery strategies

2015 ◽  
Vol 25 (6) ◽  
pp. 700-724 ◽  
Author(s):  
Víctor Iglesias ◽  
Concepción Varela-Neira ◽  
Rodolfo Vázquez-Casielles
Keyword(s):  
Design Methodology ◽  
Empirical Investigation ◽  
Service Failure ◽  
Service Recovery ◽  
Retail Banking ◽  
Content Type ◽  
Final Sample ◽  
Customer Defection ◽  
Recovery Strategies ◽  
Practical Implications

Purpose – The purpose of this paper is to analyze the effects of attributions on the efficacy of service recovery strategies in preventing customer defection following a service failure. Design/methodology/approach – The empirical investigation is carried out on the retail banking industry with a final sample of 448 real cases of customer retention or defection after a service failure. Findings – The results of the study not only highlight the relevance of intentionality as an additional factor in explaining customer defection, but also show the effects of some attributional dimensions (intentionality and controllability) on the efficacy of some recovery strategies (redress, apology and explanation) applied by companies to prevent post-complaint customer defection. Practical implications – The efficacy of the recovery strategies depends on the causal attributions that the customer makes about the service failure. Originality/value – This study analyzes not only the effects of traditional dimensions of attribution (stability and controllability), but also the additional effect that intentionality attributions may have on actual customer defection (not intentions). Moreover, it analyzes their effects on the effectiveness of recovery strategies in preventing customer defection. Most of these effects have never been empirically analyzed in the literature.

Empowerment in service recovery: the role of self-regulation process of frontline employee

2019 ◽  
Vol 58 (5) ◽  
pp. 828-843 ◽  
Author(s):  
Mo Zhang ◽  
Ruoqi Geng
Keyword(s):  
Emotional Exhaustion ◽  
Positive Impact ◽  
Service Failure ◽  
Self Regulation ◽  
Service Recovery ◽  
Job Engagement ◽  
Content Type ◽  
Regulation Process ◽  
Recovery Satisfaction ◽  
The Impact

Purpose In accordance with the commitment–trust theory, employee attitudes and behaviours mediate the impact of empowerment on service recovery performance. The purpose of this paper is to extend the self-regulating process model and develop a structural framework that combines empowerment, self-regulation mechanisms (service recovery awareness, job engagement and emotional exhaustion) and post-recovery satisfaction. This framework explores how empowerment can lead to action of frontline employees (FLEs) in service recovery. Design/methodology/approach The authors test the hypotheses by investigating 290 pairs of FLEs and customers, who have service failure experience in the express mail industry, using structure equation modelling. Findings The findings show that empowerment enhances both service recovery awareness and job engagement. On the one hand, service recovery awareness has a positive impact on emotional exhaustion, which has a negative impact on post-recovery satisfaction. On the other hand, job engagement has a positive impact on performance. These results provide the whole picture of the double-edged effects of empowerment on FLEs in service recovery. Practical implications This paper indicates that managers should re-consider approaches to empowerment based on self-regulation process to enhance performance following service failure. Originality/value This study explores the dark side of empowerment in service recovery from a self-regulation perspective.

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