Impact of failure severity levels on satisfaction and behavior: from the perspectives of justice theory and regulatory focus theory

Purpose: This study aims to investigate the moderating role of low and high failure severity levels on recovery satisfaction and on behavioral intentions through recovery satisfaction. This research adopted justice theory and regulatory focus theory to provide further explanations on the inconsistencies in the extant literature regarding service failure and responses to service recovery. Design/methodology/approach: This study applied a scenario-based experimental design of two (perceived justice: low vs high) by two (failure severity: low vs high) between-subjects factorial design. Data was collected from 237 mobile phone users recruited via convenience sampling. This study examined the hypothesized relations using Hayes (2018) PROCESS macro version 4.0. Findings: Perceived justice had a higher positive effect on recovery satisfaction at a high failure severity level. The direct effect of perceived justice on behavioral intentions was significant and positive only at a high level of failure severity, whereas the indirect effect of perceived justice on consumers’ positive behavior through recovery satisfaction was more positive at a high level of failure severity. Research limitations/implications: Justice theory and regulatory focus theory can be used to explain how a well-implemented recovery effort can offset losses that are caused by a highly severe service failure leading to satisfaction and positive responses. However, as this study was conducted within a telecommunication service context, this research needs to be replicated in other areas, including the use of other data collection methods and measurement of consumers’ regulatory focus orientation. Practical implications: The findings of this study provide managers with valuable insights into the allocation of service providers’ resources for recovery actions according to consumers’ perceived severity levels to regain consumer satisfaction and continued positive behavioral intentions. Originality/value: Past research on the effect of failure severity levels on recovery satisfaction and consumers’ positive behavioral intentions is scant, and those studies that examined severity levels have shown conflicting results. This study attempted to advance the research by examining the relationship between perceived justice, recovery satisfaction and behavioral intentions at low and high failure severity levels using justice theory and regulatory focus theory. None of the theories have been examined concurrently in the service failure and recovery framework.