The Service Recovery Paradox

The Service Recovery Paradox

What do you do about negative feedback online. Delete it? If it’s a crackpot contribution or using profanity  – sure go ahead. BUT if its genuine you might have an opportunity to INCREASE customer satisfaction and loyalty. By using something called the ‘Service Recovery Paradox (SRP)’

So what is the SRP?

A study was done years ago that found that customers who had experienced a “transgression” – or something that went wrong when buying from a brand,  and had the transgression fixed by the brand were actually more satisfied with the brand than if the service encounter had gone smoothly.

For example, a traveller’s flight is cancelled. When she calls the airline, they apologise and offer her another flight of her choice on the same day, and a discount voucher against future travel. Under the service recovery paradox, the traveller is now happier with the airline, and more loyal to it, than she would have been had no problem occurred.

In a study we did some years back we found that when someone senior from a brand responded to negative comments their brand, the brand was perceived as more trustworthy, more genuine, and generally a more positive brand.

We tested two fictitious social media pages in a laboratory experiment. Group A was a mix of positive and negative comments about a brand. Group B was purely positive.

The Service Recovery Paradox 1

The other difference was that in Group B, the negative comments had a response from someone senior from the organisation, in this case Sam Head of Sales. The response signalled empathy and an offer to fix the transgression (problem).

The Service Recovery Paradox 2

The results found the negative page had more positive evaluations from consumers. Evidence of the “Service Recovery Paradox”

The Service Recovery Paradox 3

So – the point is that on social media you shouldn’t arbitrarily delete negative comments from dissatisfied customers – they can potentially be a huge opportunity.

To see more tips, check out my 18 MBA Marketing tips on YouTube – short tips – Gold nuggets of marketing knowledge hidden in academic literature — stuff that has a powerful effect on consumer behaviour, but perhaps not that well known.

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