Extant literature has a controversy over the effects of customer relationship on customer responses to service failure. Buffering perspective suggests that strong relationship can mitigate customers¡¦ unfavorable reactions to service failure; whereas amplifying perspective finds that these negative customer responses are enhanced by strong relationship. Until now, it still lacks a unified framework to explain the mechanisms under each perspective and to reconcile both perspectives. The motivation of this research is to fill up this research gap and to solve the controversy over the effects of customer relationship under service failures. By integrating interdependence theory and reciprocity theory, this research proposes a framework to analyze when and why each of buffering and amplifying effects would occur and how amplifying effects can shift to buffering effects. The major conjectures of the framework proposed by this research are that customer relationship has amplifying effects on customers¡¦ immediate responses while it has buffering effects on their prolonged responses; moreover, customers¡¦ immediate and prolonged responses are guided by different reciprocity motivations and the shift from amplifying effects to buffering effects is triggered by motivation transformation that can be enhanced by increasing a number of customers¡¦ social concerns. This framework is verified through one survey study and two experimental studies. Collectively, the results broadly support that: (a) a customer relationship has amplifying effects on customers¡¦ immediate responses while has buffering effects on their prolonged responses; (b) immediate responses are majorly governed by self-oriented motivations in reciprocation of the firms¡¦ past behavior, whereas to some extent prolonged responses are guided by relationship-oriented motivations in reciprocation of the firms¡¦ anticipated behavior; (c) transformation of reciprocity motivations triggers the shift from amplifying effects into buffering effects; (d) concern about future of relationship with the firm increases the possibility of transformation and thus the occurrence of buffering effects.

The contribution of this dissertation is how model measurement allows examination of the balance between what is practical in terms of consumer concerns versus what is optimal in terms of cost control. Essay 1 examines a research framework that incorporates various service recovery strategies and simultaneously evaluates their comparative influences. Essay 2 evaluates the complex interrelationships among different factors related to the post-complaint behavioral process. Essay 3 fills a research gap by examining the role of brand equity by operationalizing a reflective model using PLS in operations management (OM) research. These three essays provide insight into the quality management domain and the value that is achieved via a data driven examination of theory. Moreover, this research will provide operations management practitioners a basis to carry out future research on quality management phenomena as well as insight into how to balance cost control and service recovery strategies with the goal of achieving a competitive advantage.

Purpose: This paper aims to demonstrate that online complainants' reactions to a company's service recovery attempts (webcare) can significantly vary across two different types of dissatisfied customers ("vindictives" vs "constructives"), who have dramatically diverging complaint Goal orientations. Design/methodology/Approach: Online multi-country survey among 812 adult consumers who recently had a dissatisfying brand experience and turned to a marketer-generated social media site to voice an online complaint for achieving their ultimate complaining goals. Scenario-based online experiment for cross-validating the survey findings. Findings: Results suggest that "vindictive complainants" - driven dominantly by brand-adverse motives - are immune to any form of webcare, while "constructive complainants" - interested in restoring the customer-brand relationship - react more sensitively. For the latter, "no-responses" often trigger detrimental brand-related reactions (e.g. unfavorable brand image), whereas "defensive Responses" are likely to stimulate postwebcare negative word-of-mouth. Research limitations/implications: This research identifies the gains and harms of (un-)desired webcare. By doing so, it not only sheds light on the circumstances when marketers have to fear negative effects (e.g. negative word-of-mouth) but also provides insights into the conditions when such effects are unlikely. While the findings of the cross-sectional survey are validated with an online experiment, findings should be interpreted with care as other complaining contexts should be further investigated. Practical implications: Marketers have to expect a serious "backfiring effect" from an unexpected source, namely, consumers who were initially benevolent toward the involved brand but who received an inappropriate response.

Abstract Author : Alain Patrick Ngae a Njama Tutor : Peter Caesar Examiner : Pejvak Oghazi Title : After sales service: Complaint to Service Recovery Improvement Keywords : Service Recovery, Complaint handling, service failure, service process, Svetruck AB Background : It is real that everyday people purchase goods for their daily needs and satisfaction, but unfortunately it happen that some of those goods do not live up to the customer expectations. The reality when a failure occurred is something else because is the second chance giving to the service provider to show concern. Many research agreed that good recovery after a service failure can create a positive response from the customer side as example making them loyal and sharing their positive experience to others. Purpose: The purpose of this study is to look into how service recovery influence customer retention. Research question: How Does Company handles customer’s complaint in order to fulfill service recovery ? Method: Three respondents were selected within a heavy industry call Svetruck AB. Due to their position and number of year they have been working for this company. Many section of interview were organized in order to have a clear understanding of the inside out of the service handling process. Conclusion: Complaint handling appears to be very essential for each company willing to stay in the competitive word. Some will differ from the way they handle or treat their customer but the final issue for all companies will be to keep satisfies their customer for long-term relationship, also by reducing the cost of hunting new customers. Suggestion for further research : After the investigation of complaint handling from the service 3 provider side, we can think of other areas to investigate related to this topic. One of it will be to make an investigation on complaint handling from the customer point of view to find out how the customer perceived satisfaction after the service provider have handled their complaint. Another point may be to compare Svetruck complaint handling with the one of one of their mean competitor to see the point that differ them from the others. Further investigations can also be made on unsatisfied customers, those who have experience bad service recovery by then had chosen to switch to competitor.

Among former researches regarding the consumer¡¦s post-reactions facing a ¡§Service-failure¡¨ scenario, most scholars treated the situation of ¡§Service-failure¡¨ as a whole affair, but had never tried to discuss its separate effect possibly caused by service ¡§outcome¡¨ or service ¡§process¡¨ and the potential correlation due to different combinations of this two ¡§Service-failure¡¨ types (output failure /process failure). According to ¡§A two-component model of justice¡¨ view in Organizational-Behavior domain, we can obtain the following conclusion that the influence caused by service ¡§outcome¡¨ entirely differs from which caused by service ¡§process¡¨, while the employee faces the unfair affairs of salary-treatment. Distributive-injustice is the trigger that the employee takes the action. Only when facing the condition of output failure, employees will take actions. Is service ¡§process¡¨ fair or not will determine that people adopt positive or negative action. Consequently, this research plans to apply ¡§A two-component model of justice¡¨ view to explain the possible reactions or behaviors while consumers face different ¡§Service-failure¡¨ combinations. In addition, the study also joins the factor called ¡§Coping-potential¡¨ as moderator to discuss whether the store owner can retard the negative effect caused by ¡§Service-failure¡¨ through offering consumers more convenient ways or methods to express opinions. This research adopts a scenario experimental method, taking university students and graduate students as the convenient sample, with regard to the sample the important and familiar hotel-ordering services as the study industry, designs a virtual scenario of Service-failure by manipulating three independent variables (service outcome¡Gpositive disconfirmation /match the consumer¡¦s expectation /negative disconfirmation¡Fservice process¡Gsuccess /failure¡FCoping-potential¡Ghigh /low). The study asks the experimental subject to fill after reading the description of a virtual scenario to answer the items including ¡§distributive-justice¡¨, ¡§procedural-justice¡¨, ¡§emotions¡¨ and ¡§Behavior-intention¡¨. And then we apply statistics-analysis to compare with the difference of the consumer¡¦s possible reactions when he faces variety of ¡§Service-failure¡¨ combinations. The results discovered: consumers will aim at the performances of service ¡§outcome¡¨ and service ¡§process¡¨ to carry on the judgments of distributive-justice and procedural-justice respectively when facing a ¡§Service-failure¡¨ scenario. Two dimensions of ¡§Perceived-justice¡¨ indeed play the different roles of determining the consumer¡¦s behavior. Distributive-injustice is not the trigger that the consumer takes the action. No matter how its result accords with ¡§distributive-justice¡¨, people all do something. Yet ¡§procedural-justice¡¨ truly is the main factor, which is decided that people adopt what kinds of actions (positive /negative). Under assigning the unfair result with fair procedure (output failure), the consumer will take positive reactions (e.g. offering the suggestions). On the other hand, unfair procedure will strengthen the negative responses (e.g. complaining toward the store). Under assigning the unfair situation with unfair procedure (output failure plus process failure), ¡§Coping-potential¡¨ will regulate the relation between ¡§Procedural-justice¡¨ and ¡§Behavior-intention".

Organisations are facing increasing pressures in terms of customer service since customers tend to become more demanding as competition within industries increases. In order to succeed in this changing marketplace, organisations should focus on forming and maintaining long-term relationships with their customers. Developing long-term relationships, in turn, depends on the organisation?s ability to exceed customers? expectations and to continuously ensure customer satisfaction. Service organisations in particular find it difficult to provide constant customer satisfaction due to the high level of human involvement in service delivery, which often leads to inevitable service failures. Service failures, as a result, cause the disconfirmation of service expectations. This disconfirmation gives rise to customer dissatisfaction, which is generally considered as the initiator of customer complaint behaviour. Culture is regarded as one of the most influential factors affecting customers? behaviour in response to dissatisfaction with a purchase experience. Customers? culture could have an impact on the manner in which customers engage in complaint behaviour, and could also have a bearing on how service failures and organisations? service recovery efforts are perceived. Organisations functioning in a multicultural country such as South Africa could therefore benefit from gaining a more profound understanding of cultural influences on customer behaviour and specifically complaint behaviour. The primary objective of this study was to determine the influence of culture on customers? complaint behaviour pertaining to service failures within the context of the South African banking industry. A structured, interviewer-administered questionnaire was used to collect data from banking customers residing in Gauteng, who were sampled by means of a non-probability sampling method. In total, 600 respondents participated in this study, comprising 150 each from the black, coloured, Indian/Asian and white cultural groups. Results from the study indicate that although the majority of respondents have a propensity to complain, no practically significant differences were found between respondents from different cultures with regard to their propensity to complain. Results furthermore showed no differences between the different cultural groups in terms of their complaint behaviour following a hypothetical service failure. Although it was established that respondents expect the bank to do something about the service failure ? in particular correcting the problem and providing an explanation for the problem ? respondents? expectations regarding service recovery and perceptions of the bank?s service recovery efforts were found not to have been influenced by their respective cultures. The results, in addition, showed that a higher service recovery effort had a more positive effect on respondents? post-recovery satisfaction, likelihood of maintaining their relationship with the bank and loyalty, than that of a lower service recovery effort. It is recommended that banks should not view their customers differently in terms of their cultural backgrounds, but that they should rather focus continuously on providing all customers with the same level of quality service, even after a service failure has occurred. Banks should also encourage all customers to voice complaints directly to them in order to minimise the harmful effects of negative word-of-mouth and to improve recoveries from failures. Since respondents in this study indicated that they expect banks to offer an apology in the case of a service failure, to provide an explanation of the cause of the problem and to correct the problem, banks should ensure that a high level of quality interaction takes place between the dissatisfied customer and employees following a service failure. Such an approach requires banks to ensure that their employees are motivated and competent to solve customers? problems. It is therefore also recommended that banks should invest resources in employee selection, training, development, empowerment, discretionary decision-making power and support in order to ensure that customer-facing employees are able to provide a satisfactory service recovery, and are able to efficiently manage the complaint process. Recommendations for future research include extending this study to other service settings in order to determine whether there are similarities or differences in the influence of culture on customers? complaint behaviour pertaining to service failures. Future research can be conducted in collaboration with a specific bank in order to discover more specific information with regards to service failures and complaint situations within the bank, as well as customers? perceptions of the bank?s existing service recovery systems. Finally, since no differences between cultural groups were found, this study can be replicated in order to compare South African customers with those in other countries in order to determine differences in national cultures. / Thesis (M.Com (Marketing Management))--North-West University, Potchefstroom Campus, 2011.

Organisations are facing increasing pressures in terms of customer service since customers tend to become more demanding as competition within industries increases. In order to succeed in this changing marketplace, organisations should focus on forming and maintaining long-term relationships with their customers. Developing long-term relationships, in turn, depends on the organisation?s ability to exceed customers? expectations and to continuously ensure customer satisfaction. Service organisations in particular find it difficult to provide constant customer satisfaction due to the high level of human involvement in service delivery, which often leads to inevitable service failures. Service failures, as a result, cause the disconfirmation of service expectations. This disconfirmation gives rise to customer dissatisfaction, which is generally considered as the initiator of customer complaint behaviour. Culture is regarded as one of the most influential factors affecting customers? behaviour in response to dissatisfaction with a purchase experience. Customers? culture could have an impact on the manner in which customers engage in complaint behaviour, and could also have a bearing on how service failures and organisations? service recovery efforts are perceived. Organisations functioning in a multicultural country such as South Africa could therefore benefit from gaining a more profound understanding of cultural influences on customer behaviour and specifically complaint behaviour. The primary objective of this study was to determine the influence of culture on customers? complaint behaviour pertaining to service failures within the context of the South African banking industry. A structured, interviewer-administered questionnaire was used to collect data from banking customers residing in Gauteng, who were sampled by means of a non-probability sampling method. In total, 600 respondents participated in this study, comprising 150 each from the black, coloured, Indian/Asian and white cultural groups. Results from the study indicate that although the majority of respondents have a propensity to complain, no practically significant differences were found between respondents from different cultures with regard to their propensity to complain. Results furthermore showed no differences between the different cultural groups in terms of their complaint behaviour following a hypothetical service failure. Although it was established that respondents expect the bank to do something about the service failure ? in particular correcting the problem and providing an explanation for the problem ? respondents? expectations regarding service recovery and perceptions of the bank?s service recovery efforts were found not to have been influenced by their respective cultures. The results, in addition, showed that a higher service recovery effort had a more positive effect on respondents? post-recovery satisfaction, likelihood of maintaining their relationship with the bank and loyalty, than that of a lower service recovery effort. It is recommended that banks should not view their customers differently in terms of their cultural backgrounds, but that they should rather focus continuously on providing all customers with the same level of quality service, even after a service failure has occurred. Banks should also encourage all customers to voice complaints directly to them in order to minimise the harmful effects of negative word-of-mouth and to improve recoveries from failures. Since respondents in this study indicated that they expect banks to offer an apology in the case of a service failure, to provide an explanation of the cause of the problem and to correct the problem, banks should ensure that a high level of quality interaction takes place between the dissatisfied customer and employees following a service failure. Such an approach requires banks to ensure that their employees are motivated and competent to solve customers? problems. It is therefore also recommended that banks should invest resources in employee selection, training, development, empowerment, discretionary decision-making power and support in order to ensure that customer-facing employees are able to provide a satisfactory service recovery, and are able to efficiently manage the complaint process. Recommendations for future research include extending this study to other service settings in order to determine whether there are similarities or differences in the influence of culture on customers? complaint behaviour pertaining to service failures. Future research can be conducted in collaboration with a specific bank in order to discover more specific information with regards to service failures and complaint situations within the bank, as well as customers? perceptions of the bank?s existing service recovery systems. Finally, since no differences between cultural groups were found, this study can be replicated in order to compare South African customers with those in other countries in order to determine differences in national cultures. / Thesis (M.Com (Marketing Management))--North-West University, Potchefstroom Campus, 2011.

Service failure within the airline industry has been a prominent topic within the media. Each story of a failure features a disgruntled passenger. Emotions are already high during the consumption of any airline service, and a service failure will bring on а slew of unwanted emotions. The purpose of this paper is then to understand what type of relationship do these negative emotions and feelings of lack of control have after a service failure, and do any of those given emotions lead to negative word-of-mouth (NWOM). The method used to accomplish this is correlation hypothesis testing of survey results in relation to the specified negative emotions and the causal attribution theory of control, as well as analysis between the same emotions and NWOM, again using correlation tests. This aim will be achieved by breaking service failure down into five negative incidents that are referred to as service failure scenarios, namely: luggage handling, delayed/cancelled flight, missed flight due to factors beyond customers’ control, negative customer service at the airport, and negative service experience during the flight. The five scenarios are studied against six specified emotions which are anger, frustration, helplessness, nervousness, worry, and panic. The relationship between these emotions and lack of control is tested, then these same emotions are tested in regards to NWOM. The findings express a weak to moderate positive relationship between at least one of the emotions and lack of control in three of the scenarios, leading to the conclusion that customers’ lack of control over the situation increases the intensity of the emotions. In the findings for emotions and NWOM, four out of the six tested negative emotions lead to NWOM, which are anger, frustration, helplessness, and worry. This discovery proves that different emotions in different scenarios make people react in a different manner, and this leads to the conclusion that emotions should be tested separately and scenarios should be created to research the real intensity of the emotions in different situations, without grouping them into one.

This dissertation investigates how satisfaction with a service employee affects customers' overall satisfaction with a service organization following an employee-initiated service failure. Specifically, this research examines how the severity of a peripheral service failure (how the service is delivered), quality of past core service performance (basic benefits of service), and existence of past peripheral service failures impact the extent to which customers' satisfaction with an employee transfers to evaluations of the service organization. Dimensions of attribution theory are explored as a process mediating the effects of these variables on satisfaction with the employee and organization. This dissertation extends attribution theory by differentiating controllability attributions at both the employee and organizational levels, as well as introducing attributions of globality (universal across the organization versus employee or situation-specific) to marketing. Distinctions between employee and organizational-level attributions may clarify the process by which customer evaluations of employees affect organizations. The study used an experimental role-playing methodology to test the proposed conceptual model. Four-hundred forty-five (445) air travelers comprised the sample. The design for this study varied the severity of the current peripheral service failure (less severe, more severe, and no-failure), existence of past peripheral service failures (existing and not existing), and quality of past core service performance (excellent and average). Structural equation modeling using Lisrel 8.20 was used to test the proposed hypotheses. Overall, the results show that the severity of the peripheral service failure and aspects of past service history influence the attributions that customers make following peripheral service failures. These attributions, in turn, have a significant impact on customers' satisfaction with the employee and the organization. The findings also indicate that the severity of the current peripheral failure can spill over and negatively affect customers' satisfaction with the core service component. Furthermore, the results show that both aspects of customers' past service experience with an organization (existence of past peripheral service failures, quality of past core service performance) directly impact customers' overall satisfaction with the organization. / Ph. D.

The purpose of the research study was to build a deeper understanding of negative brand experiences for consumers at the Bottom of the pyramid segment. The research took an approach of looking at a negative brand experience from end to end, by focusing on elements such as brand contacts, triggers and customer response across different experience dimensions. The literature asserts that for companies to succeed at the Bottom of the Pyramid they need to forego existing assumptions, companies must realise that low income consumers are brand conscious in order to build successful brands. Building successful brands at this market involves offering more than just a functional offering but creating an emotional bond through positive experiences. Such experiences are created each time one is in contact with one of the brand touch-points. The qualitative study showed that consumers value being treated with respect in addition to the provision of a product or service. It also shows that negative brand experiences can happen at various points for both products and services irrespective of whether a product is regarded as hedonic or utilitarian. The nature of negative word of mouth within this segment needs to be explored further as the study showed that there are other factors that influence one to spread negative word of mouth. The research study also shows that consumers are sensitive to brands that demonstrate not to care or those that break trust as such experiences lead to strong negative emotions. / Dissertation (MBA)--University of Pretoria, 2010. / Gordon Institute of Business Science (GIBS) / unrestricted