The effects of Justice Oriented Service Recovery on Customer Satisfaction and Loyalty in Retail Banks in Ethiopia

Abstract

The principal objective of this study is to investigate the effects of justice oriented service recovery on customer satisfaction in retail banks in Ethiopia. It also attempts to assess how recovery satisfaction in turn affects customer loyalty.  In order to realize the research objectives, data were collected through survey questionnaire from a total of 400 customers who have experienced service failures and recovered by the banks during the past one year.  The study utilizes the instrument developed by Tax et al. (1998). Findings reveal that, perceived justice namely procedural justice, interactional justice and distributive justice were found to be positively related to recovery satisfaction.  Recovery satisfaction is also positively related with customer loyalty.