The Price of Good Friendships: Examining the Roles of Relationship Norms and Perceived Controllability in Service Failure Encounters

Abstract

Despite companies’ efforts to cultivate positive relationships with their consumers, negative relational episodes such as customer service failures are inevitable. This study examines how perceived controllability of a service failure determines responses from consumers who have previously formed quality relationships with the company. Specifically, it distinguishes two types of quality relationships: communal and exchange relationships. It investigates how these two types of relationships interact with different levels of perceived service failure controllability, and collectively influence consumers’ emotional, cognitive, and behavioral responses (i.e., anger, perceived betrayal, and negative WOM intention) to the failure encounters. Results of an online experiment ( N = 140) show that consumers experience a greater level of anger and perceived betrayal when they consider the service failure as highly controllable (vs. uncontrollable) by the company. More important, this effect pattern only occurs when prior company-consumer relationships are communal rather than exchange. The results of this study enrich our body of knowledge on the role of company-consumer relationships in service failure encounters and provide useful guidelines for company-consumer relationship development and service failure management and recovery.