Customer retaliation at the employee–customer interface

Abstract

AbstractThe service encounter is the point where employees and customers interact both positively and negatively. When things go wrong (service failure), initially it is the employee who is required to remedy the situation (recover the service). While positive service recovery outcomes are well investigated, there is little research that investigates whether specific service recovery strategies can be used to reduce customer anger and retaliation. Further, there is little research regarding whether an organisation's acceptance of blame has an effect on customer anger and retaliation. These gaps are addressed using a quasi-experimental study of 120 respondents that examines customers' emotional and behavioural responses to specific service recovery strategies following a service failure. The results show that high-level service recovery strategies directly reduce the occurrence of retaliation, as well as indirectly reduce retaliation through the mediating effects of customer anger. The theoretical and practical implications of these results are discussed.