Service Failures and Recovery Strategies in E-tailing: Examining the effects of Product Type and Transaction Frequency

Abstract

The purpose of this paper is recognize product type differences on post recovery satisfaction levels when online purchase failures happen at any stage during an order fulfilment cycle. In particular, we determine how it changes based on the recovery strategy adopted. Findings support the hypothesis that the satisfaction regarding an online purchase reduces when the product is purchased with more shopping effort, i.e. customers will have more satisfaction regarding the order fulfilment process when buying a convenience good than buying a speciality good. This study is unique in that, unlike previous studies on order fulfilment process in e-tailing investigating the relationship between severity of a service failure and post recovery satisfaction, we examine how does the satisfaction levels upon service recovery strategy adopted changes based on the frequency of purchase of the customer on an e-tailing platform. Results suggest that the satisfaction after an online purchase failure and its recovery tends to be high for a customer who has a high frequency of purchasing online than a person with a low frequency of purchasing online.