Service Recovery Paradox

What it is

A 2007 meta-analysis led by Celso Augusto de Matos found the paradox significant and positive for satisfaction, but nonsignificant for repurchase intentions, word of mouth and the customer's image of the company. Study design, the type of participant and the service category all changed the size of the satisfaction effect.

A 2008 study by Stefan Michel and Matthew Meuter, using more than 11,000 bank customer interviews, found the paradox rare and its effects small. Scenario experiments by Michael McCollough and colleagues in 2000 found satisfaction lower after failure and recovery than after error-free service. Role-play studies led by Vincent Magnini in 2007 found the paradox most likely when the failure was minor, a first, a one-off and outside the company's control.

In effect

A good recovery protects satisfaction and keeps a bad moment from becoming a lost customer. Preventing the failure protects loyalty. The paradox is a reason to recover well, not a reason to relax about getting it right first time.

What it does not say

It does not say mistakes are opportunities. The meta-analysis found no significant effect on whether customers return or recommend.

It does not survive repetition. A second failure is evidence of a pattern, and the conditions for the paradox disappear.

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