Consumer as Stakeholder in Service Crises: Perspectives from Services Marketing

Abstract

This paper seeks to increase understanding of the subtleties of the consumer stakeholder role in crises that affect service organisations. In so doing, it focuses on research findings that have adopted a consumer perspective on service failures and service recovery, and evaluates current services marketing research on the fundamental notion of consumer participation in service production. A case study of an organisation that was subject to two crises over a two-year period is used to highlight the elements of a services marketing approach to service recovery, and to make clear the effect of consumers' participation in services on their behaviours in service crises. While there is some evidence, in the case study, of the appropriateness of ‘standard’ service recovery strategies, it is argued that it is the implications of consumer participation in services—especially the roles of dysfunctional consumers, and the dynamics of consumer-to-consumer interactions—that are the most important in understanding the consumer stakeholder role in service crises. In summary, the ‘customer as stakeholder’ approach from services marketing advocated in the paper further enhances the necessarily multifunctional risk management processes that companies require to improve their operational and strategic resilience.