Airline Service Failure: Determinants of Passengers\u27 Intention to Fly Again and Likelihood to Recommend

This study aimed to investigate the impacts of causal attributions (controllability, stability, and locus of control) and failure severity on the behavioral intention of passengers in the context of airline service failure. This study also extended the causal attribution theory by incorporating failure severity as another explanatory variable. Furthermore, all the above direct relationships were also expected to be mediated by brand attitude. Essentially, this study attempted to address the issue of the desire of passengers to fly again with the affected airlines and the extent to which they will recommend it to others. This study employed purposive sampling and a questionnaire survey that involved 518 respondents as the main data collection method. All hypotheses were tested using Smart-PLS. The findings revealed that only controllability and failure severity exhibited direct impacts on behavioral intention, whereas stability and locus of control indirectly affected behavioral intention through the mediator of brand attitude. The findings also indicated that brand attitude was a full mediator in the relationships between stability and behavioral intention, as well as between locus of control and behavioral intention

Engaging your customers via responding to online product reviews

Given the tremendous impact of online reviews on consumer choice, responding to online word of mouth (WOM) has become an important channel for firms to engage the consumers. This thesis investigates how firms can proactively respond to online product reviews to engage customers and manage customer relationships. In Study One, based upon the data of hotel reviews on Tripadvisor.com, I propose that responding by firms differ in three aspects, namely frequency, speed, and the amount of information, and these metrics exert significant influence on subsequent consumes’ WOM engagement, hotel rankings, and votes of usefulness of the reviews. Moreover, in contrast to responding to positive reviews, responding to negative reviews greatly affects consumption decisions given the negativity bias among consumers. Thus, the subsequent two studies examine whether responding help to alleviate the detrimental impact of negative reviews. Drawing from the literature on crisis management, service failure recovery, Study Two posits that sellers’ responses to negative WOM can be categorized as defensive and accommodative. Further, whether accommodative or defensive responding is more effective depends upon the nature of NWOM, namely regular NWOM or product failure. Based on the results of a between-subject experiment, Study Two provides evidence for the asymmetric impact of accommodative versus defensive responding. When confronting regular NWOM, defensive response outperforms accommodative response or no response, whereas accommodative response is superior to defensive response or no response when coping with a service failure. Further, based on the attribution of negative reviews, a moderated mediation effect is found. To enhance the external validity and robustness of these findings, Study Three provides econometric evidence that the relative effectiveness of accommodative vs defensive response on subsequent consumers’ evaluation of their consumption experience. Upon analyzing the hotels’ responses on Tripadvisor.com, responding can be a double-edged sword in that it works only when seller takes the appropriate responding strategies. In particular, the higher proportion of accommodative responses (defensive responses) for product failure reviews (regular negative reviews), the higher the subsequent consumers’ satisfaction. However, responding can backfire when the proportion of defensive responses (accommodative responses) for product failure (regular negative reviews) is high. To recapitulate, this thesis identifies whether and how online responding influences consumer experiences on social media. These research findings can help firms formulate effective responding strategies to take advantage of social media’s unique ability to engage customers and improve consumer satisfaction and loyalty

Tell it like it is: The effects of differing responses to negative online reviews

Negative electronic word‐of‐mouth (eWOM) has a notable impact on a consumer\u27s online purchase decisions and attitude toward a company or product. Despite substantial research examining this phenomenon, little attention has been given to the impact of responses to negative eWOM. The authors examine negative eWOM in the form of online reviews to understand how responses may impact a consumer’s product satisfaction and attitude toward the company. Three studies examine specific aspects of responses, including responder type, attribution, and severity of negative review. Consistent findings across the studies reveal while any response is better than no response, a fellow consumer responding to a negative review can produce the most beneficial outcomes. The findings of this study are important for advancing theory in relation to negative eWOM and for helping practitioners develop appropriate response strategies

Using spotlight effect to curb counterfeit consumption – an experimental investigation

Purpose – The purpose of this paper is to investigate how counterfeit users estimate the probability of being detected and how this probability affects their counterfeit consumption behaviour. Specifically, it addresses three questions: do perceived social consequences influence counterfeit users’ probability estimate of being detected? What is the psychological mechanism underlying the estimation of this probability? And how does this probability estimate affect counterfeit purchase and usage intentions? Design/methodology/approach – The authors used three scenario-based experimental studies with university students in Hong Kong, a place where counterfeit products are widely available. First study used a factitious brand of jeans as the stimulus and the other two studies used a Ralph Lauren polo shirt. In each study, the authors measured participants’ responses towards counterfeit purchase and the probability of being detected after they read the relevant brand information and had a close-up view of the attributes in the genuine and counterfeit versions. Findings – The authors found that counterfeit users are susceptible to a pessimism bias such that they estimate a higher probability of being detected when they judge the outcome of being detected as more severe and this bias is driven by the spotlight effect in that counterfeit users judging the outcome as more severe tend to perceive that others pay more attention to their counterfeit usage. Moreover, this pessimism bias is mitigated when the target user is another person instead of oneself, thus suggesting the egocentric nature of the bias. Research limitations/implications – The authors used undergraduate students and scenario-based experimental approach in all the studies that may limit the generalisability of the findings. Practical implications – The results suggest that brand managers should emphasise the importance of negative social consequences and highlight the role of outcome severity and egocentric bias in their advertising and communication programmes in order to curb counterfeit consumption. Originality/value – The research contributes to the growing literature on counterfeit consumption by studying the process underlying estimation of the probability of being detected by others, an important but often neglected factor that influences counterfeit purchase decision. The authors also highlight the role of outcome severity and egocentric bias in this process

Judging Corporate Ostriches? A Study of Consumers’ Attitude Towards the Chain Liability and Green Characteristics of a Focal Firm during Sustainability Crises

When sustainability crises occur, and these are revealed to the consumers, scandals may arise, triggering reactions among the consumers. Even though the crisis may happen far away, both geographically and organizationally, the focal firm may be held accountable by the consumers, triggering a “chain liability” for their chain members. This paper uses the consumers as a “jury.” It assesses the chain liability of a focal firm for unsustainable supplier behavior and the effect of organizational distance between the focal firm and sustainability crises, measuring accountability for the crisis at the first supplier tier level as opposed to integration. Also, following the green shift, we assess how certain green characteristics - green marketing and ecolabels, affect the degree to which the focal firm is held accountable. Lastly, accountability is tested towards consumers' purchase intentions. Using an experimental design consisting of eight experimental groups obtained through convenience sampling, we found that organizational distance increases accountability at this tier level. This trend means the focal firm is punished for outsourcing or equally rewarded for integration of production that becomes subject to a crisis. They are also rewarded for using ecolabels, and accountability is significantly negatively correlated with purchase intentions. We found no effect of green marketing on accountability or any interaction effects between any of the variables in the study. The findings that integration and ecolabel act as mitigating circumstances suggest that consumers adopt a somewhat simplified judgment and merely evaluate the degree to which the focal firm has faced the risks and reward them for taking preventive steps to lower the chance of a crisis. On the flip side, they seemingly punish firms for the act of “sticking their heads in the sand” and being “corporate ostriches.”nhhma

Self-Service Technologies that Appear Human Interacting with Customers: Effects on Third-Party Observers

This dissertation examines the effects of viewing and hearing service failure and recovery interactions between self-service technologies (SSTs) and customers on third-party observers. Third-party observers are those that observe the actions of other customers as they interact with a firm in some way. These observations could occur in the present (face-to-face) or past (watching a video or listening to an audio recording). Third-party observers provide a unique perspective as they can provide a more neutral perspective of a failed service transaction and recovery as compared to the involved customer and firm. This dissertation contributes to the SST literature and to theory by creating a virtual service agent acceptance model. An important grounding theory used is attribution theory. Simply, attribution theory (Heider 1958; Weiner 1985, 2006) posits that we are motivated to attribute meaningful causes to action and behavior. The theory suggests that when faced with the task of appraising an outcome, we broadly make either dispositional attributions, which reside firmly within the individual, or situational attributions, which refer to external factors outside of the individual. Attribution theory has been extended to the service context to explain where failures are attributed, and the causal inferences made by customers when a service failure occurs. While much literature has been written on the attribution process with the interaction between human employees and customers, the literature remains sparse on attribution theory as it relates to third-party observers viewing interactions between SSTs and customers. Additionally, much of the previous research has assumed the locus of causality to be unambiguous, assuming the cause of service failures lies within the firm or employee. This may not always be the case with new SSTs, such as avatars, and the cause of the failure may indeed lie within the customer or with situational aspects. I intend to fill this gap with the dissertation and delve into the mechanisms that drive attribution. As artificial intelligence increases the capabilities of self-service technology and these SSTs progress to be closer and closer to being indistinguishable from real humans, this research is important to managers of firms as they will make decisions on employing self-service technologies, human employees or a mixture of both working side by side. Study 1 specifically explores a service failure and recovery situation between a customer and an SST (i.e., an avatar). Study 1 finds main effects of customer attributes, avatar attributes and important interaction effects of service elements that impact attributions of failure. Further, Study 1 shows how these attributions of failure impact the third-party observer’s satisfaction toward the avatar. Furthermore, Study 1 shows how their perceived satisfaction affects their future approach intention of avatars. These are important findings as they show that third-party observers are able to evaluate service interactions that fail and subsequent recoveries to the failure and use this information to determine their perceived satisfaction and potentially whether or not they intend to use the services they observed in the future. Lastly, Study 1 adds to the attribution theory literature as it left the locus of causality dimension ambiguous allowing the respondent, acting as the third-party observer, to attribute the failure to not only the firm or avatar, but also the customer. This is an important gap to fill as it allows the observer the opportunity to attribute failure to the customer where much of the previous literature has not. Study 2 further extends the virtual service agent acceptance model as it uses appraisal theory to ground the prediction concerning negative emotions and coping responses to an observed failure. Simply, appraisal theory predicts that when observing an event, an observer appraises the event, experiences emotions through this appraisal and copes with the observed event (Lazarus, 1991; Lazarus and Smith, 1988). Study 2 specifically shows the effects of service elements on emotions and coping resources. Moreover, it shows the effects of these coping resources on choice behavior toward SSTs of third-party observers. Study 2 adds to and extends Study 1 and adds robustness to the findings. Together, these studies contribute to the literature in three ways 1) Adding to the emerging AI powered SST literature, 2) blending the established theories of attribution and appraisal theory to form the virtual service agent acceptance model to explain and predict the acceptance of SSTs by third-party observers, and 3) adding to the others literature showing the importance of the effects of observing a customer interact with the firm on third parties in a service interaction

A bibliometric investigation of service failure literature and a research agenda

Purpose - This research studies the citations made in service failure literature, and assesses the knowledge construction of this region of exploration to date. Design/methodology/approach - The bibliometric investigation assesses 416 service failure articles in business associated research. Multidimensional scaling (MDS) is employed to uncover the scope of the scholarly impacts that have helped understand the nature of the service failure literature. The establishment of knowledge in the service failure literature is revealed by analysing co-citation data to identify significant topical impacts. Findings - The theoretical model combines five areas with significant propositions for the future improvement of service failure as an area of investigation. The most important research themes in-service failure literature are service failure, service failure communication, the recovery process, recovery offer and intention. Research limitations/implications - Potential research concentrating on the service failure literature could use search terms improved from the literature review, or use a comparable approach whereby a board of well-informed scholars approved the keywords used. Practical implications - This paper is beneficial for any reader who is interested in understanding the components of the perception of justice and recovery and how it improves repurchase intention. Originality/value - The study seeks to influence resource and recovery-based concepts and utilises the five supporting knowledge groups to suggest a plan for future research that fills existing gaps and offers the possibility of expanding and enhancing the service failure literature

Fashion without pollution: How consumers evaluate brands after an NGO campaign aimed at reducing toxic chemicals in the fashion industry

This research analyzes the effects on consumer responses of an NGO campaign (Greenpeace\u2019s 2011 Detox campaign), aimed at reducing toxic chemicals in the manufacturing processes and final products of fashion brands. The proposed model explains and tests the mechanisms underlying negative consumer reactions to the fashion brands that are the focus of NGO campaigns. The findings illustrate the mediating role that consumers\u2019 evaluations of brand blame play in their attitude towards such brands and subsequent purchase intentions. Two relevant moderators \u2013 (1) consumer reasons for justifying brands\u2019 unethical behavior in the market and (2) the decision of certain brands to comply with the NGO campaign\u2019s requests \u2013 play a significant part in the mediation mechanism. These findings make original contributions to theory and have important implications for consumers, companies, and NGOs, because they provide fresh insights into understanding, and handling effectively, consumer reactions to NGO campaigns aimed at reducing the use of toxic chemicals in the fashion industry

Do you really know your consumers? : analyzing the impact of consumer knowledge on use and failure evaluation of consumer electronics

The field of Consumer Electronics (CE) can be characterized by continuous technological innovation, fierce global competition, strong pressure on time-to-market, fast adoption cycles and increasingly complex business processes. In this context it is increasingly challenging for product designers and developers to provide products with unique features and excellent price / performance characteristics, as well as having to provide products that meet all the consumer’s expectations. From a business perspective, research has shown that the number of consumer complaints and even product returns is increasing for complex CE (Den Ouden, 2006). Further research on the causes of these complaints showed that almost half of the complaints were due to non-technical reasons. Therefore, more insight is needed into product quality and reliability from a consumer point of view. A literature review showed that quality and reliability methods that are currently used in product development insufficiently prevent the large variety of consumer complaints: the number of consumer complaints is rising while at the same time the root cause of these complaints is more difficult to retrace. Product failures need to be measured and analyzed from a consumer’s point of view since the traditional fault-complaint propagation model fails to capture all potential sources of consumer complaints. More insight is needed into the relation between the diversity of consumers and the propagation of product development faults to these "Consumer-Perceived Failures" (CPFs).A conceptual framework was developed to model the underlying factors related to the propagation of product development faults to consumer complaints from a consumer point of view. This framework is based on insights from human-computer interaction and consumer behavior literature and the results of an explorative experiment. Furthermore, the most commonly used consumer selection criteria for consumer tests based on demographics and/or product adoption related characteristics do not sufficiently cover differences in CPFs. The consumer characteristic "consumer knowledge" is hypothesized to have a strong impact on differences in the underlying variables of this framework. A review of relevant consumer models and consumer characteristics used in human-computer interaction and consumer behavior research shows that this construct relates to cognitive structures consumers have about a product’s functioning as well as cognitive processes needed to use a complex CE product. This dissertation therefore aimed to investigate the hypothesized effect of consumer knowledge on two important variables of the conceptual framework: product usage behavior and failure attribution. By using multiple surveys, two laboratory experiments and a web-based experiment, the following aspects of the conceptual framework were investigated in this dissertation: • How and to what extent consumers can be differentiated on knowledge of complex CE • The effect of consumer knowledge on differences in product usage behavior • The effect of consumer knowledge on differences in attribution of product failures The results of the surveys to differentiate consumers on knowledge (both core and supplemental domains) of innovative LCD televisions demonstrated the successful development and validation of measurements of both subjective and objective measurements of expertise and familiarity. It was concluded that the selection of consumer knowledge constructs as criterion for differentiating consumers for a consumer test depends on the target consumer group for a product (e.g. a very narrow homogeneous consumer group versus mass consumer markets), the type of product (e.g. passive versus active interaction) and the goal of the consumer test. The laboratory experiment which investigated the effect of subjective expertise and objective familiarity on product usage behavior showed that higher levels of subjective expertise on both the television and computer domain result in significantly better effectiveness and efficiency and less interaction problems when performing complex product related tasks. Next, the results also showed that differences in subjective expertise stronger relate to differences in product usage behavior than those in objective familiarity. The findings of this study help product developers and designers to better understand differences in product usage behavior when consumers encounter interaction problems and can therefore help the product designers and developers to take better design decisions.The results of both failure attribution experiments with simulated failure scenarios of picture quality failures in an LCD television showed that only objective expertise differences affect differences in consumer perception of product failures. However, although the failure attribution of consumers with higher levels of objective expertise has more dimensions and is more refined, higher levels of objective expertise on a product do not automatically result in attributions that are more in accordance with the real physical cause of the failure. This has important implications because currently used test methods often differentiate consumers only on previous experience (i.e. familiarity) with a product. The results of both studies also demonstrated that both failure cause and failure impact do not significantly affect how consumers attribute the failures. In total it can be concluded that, when evaluating the effect of consumer diversity on fault-complaint propagation, consumer knowledge can be used to differentiate product use and failure attribution for complex CE. However, it should be noted that especially for failure attribution this effect is not consistent across different types of failures. In addition, compared to objective and subjective familiarity and subjective expertise, objective expertise has the strongest impact. In the context of fast evolving complex CE, objective expertise measurements are becoming increasingly important because familiarity or subjective expertise measurements on the (technical) functioning of currently available products can quickly become "incorrect" or "incomplete" for the next generation of products. These insights can support product designers and developers to make the right design decisions to enhance consumer satisfaction