Consumer responses to online retailer's service recovery after a service failure

Purpose The purpose of this paper is to investigate consumer responses to online retailer service recovery remedies following a service failure and explores whether the phenomenon of the service recovery paradox exists within the context of online retailing. Design/methodology/approach This paper reports on the results of two studies. Study I explores the main and interaction effects of the various dimensions of service recovery justice (i.e. distributive justice, procedural justice, and interactional justice) on customer satisfaction, negative word‐of‐mouth (WOM), and repurchase intention based on the justice theory. Study II investigates whether the phenomenon of the service recovery paradox exists (i.e. whether customers have higher satisfaction, higher repurchase intention, and lower negative word‐of‐mouth after experiencing an effectively remedied service failure as compared to if the service failure had not occurred). A laboratory experimental design is used to test the research hypotheses. Findings The results show that distributive justice, procedural justice, and interactional justice have a significant positive influence on customer satisfaction. Among the three dimensions of service recovery justice, only distributive justice has a significant positive influence on repurchase intention, and only interactional justice has a significant negative influence on negative WOM. Additionally, both the interaction between distributive justice and procedural justice and the interaction between distributive justice and interactional justice are found to significantly influence customer satisfaction, negative WOM, and repurchase intention. The results also indicate that the service recovery paradox does not appear to exist in the online retailing context. Practical implications The findings will allow online retailers to develop more effective strategies for preventing service failure and improving customer satisfaction, negative WOM, and repurchase intention. Originality/value This study contributes to the understanding of consumer responses to online retailer's service recovery after a service failure.