Opportunity gone in a flash: Measurement of e-commerce service failure and justice with recovery as a source of e-loyalty

Abstract Online flash sales (OFS) are an opportunity for customers to purchase goods with large discounts for a limited period, along with the increased risk of service failures due to heavy demand for such offers. The current work examines the impact of OFS e-commerce service failures, as well as that of perceived customer opportunism (PCO), on perceived justice with service recovery (PJWSR), post-recovery satisfaction (SSR), post-recovery perceived switching cost (PSC) and e-loyalty. By using a mixed-method approach, the current work develops a novel framework for OFS e-commerce service failure. Failure is conceptualized as functional, information, and system failures, with unique sub-dimensions/measurement items underlying each. Our findings suggest that functional and information failures have a negative effect on PJWSR, PCO has a positive effect on PJWSR, PJWSR has a significant effect on SSR/PSC and SSR positively affects e-loyalty, with no moderation of PSC on this relationship. This work contributes to the e-commerce service failure and customer opportunism literature by proposing a new contextual scale for measuring OFS e-commerce service failures and the impact of recovery-induced justice on a customer's loyalty. Leveraging this work, e-tailers need to make judicious decisions to avoid specific failures during OFS by designing robust e-commerce systems and, in the case of a failure, to have a responsive recovery protocol to enhance PJWSR and subsequent e-loyalty.

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