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The Long-Term Impact of Service Failure and Recovery

The latest study by Tim Norvell and Piyush Kumar examined customers’ short-term attitudinal and long-term behavioral responses to service failures and recovery efforts.

Their data from a tracking study of casual dining restaurants customers indicate that those who did not experience any failure were more satisfied than those who experienced successful recovery following a failure. The satisfactory recovery group, in turn, was more satisfied than customers who either did not complain or were not successfully recovered following their complaints.

Importantly, the pattern of brand patronage over the medium and long run differed substantially from the short-term variation in satisfaction levels across the four customer groups.

In the medium term, the brand visitation frequency for those who never experienced failure was similar to those of customers who were successfully recovered. The visitation frequencies of customers who did not complain or were not successfully recovered were lower. However, over the long run, the visitation pattern changed substantially, and those who never experienced failure had higher brand patronage frequency than all the three remaining groups that behaved relatively similarly.

These results suggest that customers make a distinction between the qualities of the core service and the recovery effort. Although successful recovery temporarily compensates for core failure, its positive influence dissipates over time. In the longer term, customers’ complaining behavior and the firm’s recovery efforts matters less and customers’ brand patronage depends largely on whether or not they experienced core service failure.

Nevertheless, firms can recover their investments in service recovery because of increased brand patronage in the medium term.

The research article was published in March 26, 2018 in Cornell Hospitality Magazine.