Service Recovery Effects on Customer Satisfaction Essay

Service Recovery Effects on Customer Satisfaction - Essay Example Further, the research results showed that their was a correlation between service recovery and customer loyalty. 1. Introduction The concept of service recovery is both a business function and a critical focus point from the marketing perspective. The hotel industry is majorly based on offering intangible services and this makes service recovery an important business strategy. Essentially, service recovery entails the measures that an organization puts in place to respond to failures in service delivery. The hotel industry is prone to several variables that make it necessary to put in place service recovery strategies. Therefore, the effect of service recovery on customer satisfaction and loyalty becomes an important topic of research. To gain insight into this topic, the researcher used questionnaires to collect data which was used to analyze the impact of service delivery on customer loyalty and satisfaction in the hotel industry. 1.1 Research Aim This report aims to examine the im pacts of service recovery on customer satisfaction and loyalty in the hotel industry. ... 2. Literature Review 2.1 Service Recovery According to Keith (2008), service recovery is the well thought out process solving the issues of aggrieved customer and returning the customer to a state of satisfaction with the product or company. Service delivery can also be thought of as the set of actions a firm takes as a response to poor service quality (Andreasson, 2000). Therefore, service recovery can be considered as the response of a firm to its clients after a product or service failure with the intention of appeasing the aggrieved client and maintain their business value. The ultimate goal of service recovery is to ensure that clients maintain their business relationships with the firm that caused them the initial problem. In every organization, things occur that may have undesired effect on the customer. Hence, a company needs to have systems in place to implement corrective measures whe n things go wrong. The ultimate test of a company’s commitment to quality service is how it handles issues concerning instances of provision of below per services (Craig. 1999). He further argues that organizations need to put in place effective recovery strategies to win back a customers trust after instances problems in service delivery. Service recovery strategies are necessary to ensure that the service failures do not fit into a pattern of failure which might have devastating effects on the business enterprise (Berry 1995). Some studies indicate that excellent initial service is much better than relying on service recovery. However, other studies point out that service recovery has a greater impact on the customer than even the initial service.