Understanding Customer Responses to Service Failures during the COVID-19 Pandemic for Sustained Restaurant Businesses: Focusing on Guanxi

Abstract

Due to the COVID-19 pandemic, restaurants worldwide, including China, have been forced to protect public health by following food safety standards and adapting to the necessary social distancing practices. Accordingly, restaurant diners who are concerned about food safety and unsure of whether it is truly safe to dine out, put more importance on the entire stages of service consumption. Restaurants must make their best efforts to minimize service failures in their service provision process and outcomes. Given that customers from different cultures are reported to evaluate service quality differently, this study was designed to investigate what actions Chinese customers who encounter service failures would take under the influence of Guanxi. Guanxi represents Chinese attitudes towards long-term individual and business relationships and ultimately involves moral obligations and mutual favors. Analyzing our structural equation model using 439 responses obtained from Chinese diners, this study determined that Chinese consumers would react differently in the service process failures and outcome failures in terms of negative word-of-mouth, direct complaints, switching intention, and revisit intention. More importantly, this study confirmed the significant moderating effects of Guanxi within the proposed relationships. Based on the study’s findings, useful implications are provided for academics and practitioners regarding sustained restaurant businesses.