The harmful consequences of failed recoveries in the banking industry

Purpose – This paper aims to examine which behaviour or set of behaviours customers are prone to follow in double deviation scenarios (i.e. consumption experiences in which customers face both the initial service failure and a failed service recovery), as well as how customers' perceptions of the problem and the firm's recovery efforts may influence these behaviours.Design/methodology/approach – The paper uses multinomial logit models with random coefficients to test the proposed model.Findings – Magnitude of service failure, explanations, apologies, perceived justice, anger and frustration felt by the customer, and satisfaction with the service recovery have significant and different effects on customers' choice of a type of response.Research limitations/implications – Additional research should try to determine the effects of different variables and their potential interactions. Further work incorporating different subjects, service settings or additional combinations of complaining behaviours is needed...

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