An Investigation of Customers’ Recovery Expectations after Service Failure: Evidence from e-Commerce Settings at Different Stages of Maturity

Abstract

Although recovery strategy literature is developing rapidly, less is known about e-commerce customers’ recovery expectations in settings at different stages of e-commerce maturity. Using a grounded theoretical paradigm and drawing on the decoy effect and paradox of choice theories, we explore customers’ recovery expectations by analyzing 110 interviews with e-commerce customers and e-commerce managers in two settings at different stages of e-commerce maturity: Kosovo and the USA (Study 1). We propose a framework with three types of customers whose emotions during service failure and recovery (indicated by their recovery language), and the type of service failure experienced are cues to their recovery expectations. Utilizing exploratory factor analysis, this framework is validated through a survey of 171 randomly selected e-commerce customers (Study 2). The findings expand theoretical understanding, and provide managers with guidelines for the alignment of customers’ expectations and e-commerce recovery delivery.