MITIGATING ATTRIBUTIONAL BIAS THROUGH CUSTOMER ENGAGEMENT
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A company’s collaborative competence to seamlessly engage with its customers within the service industry becomes one of the primary sources of competitive advantage. Increasingly more customers expect more personalized and contextualized services to maximize the value they can obtain from each transaction, and companies are actively seeking opportunities to listen and learn from customers to enhance their value proposition. Scholars in the service marketing literature suggest that service recovery encounter represent one of the situations where a company can effectively leverage its collaborative competence to restore the company-customer relationship damaged due to an initial service failure. One of the important benefits customers can obtain from actively engaging in recovery is enhanced control. However, they are required to put additional personal resources which count as an increased cost for customers. Also, depending on the nature of a collaborative outcome (positive vs. negative), customers tend to ascribe responsibility differently (more credit to oneself for a positive result and less blame for an adverse result). This study attempts to 1) investigate the role of enhanced control and increased self-effort in customers’ equity perception toward a service recovery encounter and 2) examine how attributional bias intervene in the process. A 2 x 2 web-based experiment with a service recovery scenario was designed and administered to collect the data. The results indicate that when the resulting outcome is not desirable, the increased self-effort from customers counteracts the positive effect of enhanced control. When the recovery outcome is positive, on the other hand, customers with a low level of involvement in recovery process tend to overestimate their self-effort. However, such effect does not exist for customers with a high level of engagement. This study contributes to the extant literature by contemplating adverse impacts of effort and positive impacts of empowering customers with more control. It also provides valuable insight into the usefulness of customer engagement as a pre-emptive recovery strategy.