What service firms can do to mitigate (unintended) unfairness in service encounters
(A2023-114070)

AUTHORS

Karin Teichmann, University of Innsbruck; Ursula Scholl-Grissemann, UMIT TIROL Private University for Health Sciences, Medical Informatics and Technology, Division for Management in Health and Sport Tourism; Nicola E. Stokburger-Sauer, Innsbruck, School of Management

ABSTRACT

It is well known that failed services have severe consequences such as negative word-of-mouth, service switching, or customer churn. Yet, customers might also abandon a service provider even if they do not consider a service to be failed but unfair. Our research identifies three remedies for service firms to potentially mitigate the negative effects on customers’ word-of-mouth when customers encounter unfairness: customer participation, price savings, and process enjoyment. Results of two experimental studies in two different industries (health care and leisure) reveal that high levels of customer participation and process enjoyment can compensate for shortcomings in fairness experienced during the service encounter. Price savings cannot mitigate the detrimental effects of customers’ perceived unfairness, though.