The Impact of Process Recovery Communication on Customer Satisfaction, Repurchase Intentions, and Word-of-Mouth Intentions

Abstract

Complaint management should not be restricted to a firm’s efforts to fix the problem and restore customer satisfaction after a service failure (i.e., customer recovery [CR]). Rather, firms should learn from customer complaints and improve their processes to prevent similar failures (i.e., process recovery [PR]). PR communication, or the feedback to customers that describes how an organization has executed complaint-based process improvements, thus may be critical. Four studies investigate the impact of PR communication on customer outcomes for customers (1) who experienced a failure, complained, and received satisfactory CR; (2) who experienced a failure, complained, and received unsatisfactory CR; (3) who experienced a failure but did not complain; and (4) who did not experience a failure. PR communication positively affects customers' overall satisfaction, repurchase intentions, and word-of-mouth intentions through higher perceptions of the firm’s relationship investment and overall justice. In addition, such communication is most effective for the second and third types of customers; the effects for the first and fourth types are less pronounced. Managers who want to maximize the return on their complaint-handling efforts should communicate process recoveries to customers.