Due to the common business practice emphasizing that “customer is our priority”, many companies are having a potential risk of dealing with lying customer and as a consequence, service recovery can be open to misuse by customers. Although opportunistic complaint is the major issue in hospitality industry which have negative impact on firms (Baker et al., 2012), most of the service failure and recovery literature focused on examining victim customers and their reaction to the service recovery, yet very little is known about how customers react to observing service failure made up by customers. To fill this gap in the literature, the purpose of this study is to examine the effects of observing service recovery aimed at opportunistic customers on customer behavioral reaction, namely, tipping behavior, revisit intention and intention to complain. A 2 (Service recovery aimed at other customer; good vs. bad) x 2 (Complaining behavior of other customers: legitimate vs. illegitimate) x 2 (Emotional expression: outrageous vs. calm) scenario-based between-subjects factorial experiment is utilized. This research provides evidence that observing opportunistic complaining behavior of other customers and the following service recovery aimed at other customers impact behavioral reaction of customers who witness that situation. This study broadens the service recovery literature by incorporating third party justice theory into dealing with illegitimate customer, which is not a case that the firm is responsible for the service recovery. In addition, the findings from this study addresses the benefit to the service industry by understanding the impact of observing other customers service recovery treatment on observers’ emotional reactions to the situation as well as subsequent behavioral intention.

The unique benefits offered by mobile shopping services have created new value propositions that motivate consumers choosing the mobile shopping channel over other channels. Consumers use the mobile shopping channel in different situational contexts regardless temporal and spatial constraints. The situational motivations using mobile shopping services are from consumer expectations of the benefits they can obtain in a specific situation, driving consumers to use the services again in the situation. Drawing upon assimilation-contrast theory (LaTour & Peat, 1979) and the notion of compatibility in Perceived Characteristics of Innovation (PCI) framework (Rogers, 1995), consumers tend to compare consumption experiences to their internalized standards (e.g., expectations, performance norms) for subsequent evaluations (LaTour & Peat, 1979). When consumer experience of using the product/service is consistent with their internalized standards, consumers will perceive the product or service is compatible, fulfilling their needs and values. Thus, once compatibility of the product or service is determined, consumer continued intention to use the product or service could be increased. By applying this conceptual framework to consumer mobile shopping behavior, this study examined the different sets of situational motivations (i.e., variety seeking, information in planned, time pressure, pleasure in bargain) of mobile shopping and how the different motivational factors may increase compatibility of mobile shopping services and further lead continued intention to use the services. A total 305 completed responses were collected via online. The sample consisted of slightly more female (52.1%) than males (47.9%); ages ranging from 19 to 63. The two steps of structural equation modeling were used to validate measurement model and to test hypotheses using Amos 22.0.The measurement model was evaluated using Confirmatory Factor Analysis, showing a good fit to the data (χ2 = 294.218 with 103 df at p-value .000, CFI of .926, and RMSEA of .078). The fit statistics of the structural model indicated a good fit to the data (χ2 = 317.925 with 107 df at p-value .000, CFI of .919, and RMSEA of .081). The study found that variety seeking (Г = .942, t = 5.254, p-value < .001) and time pressure (Г = .205, t = 1.970, p-value= .049) motivations were positively related with mobile shopping compatibility and the compatibility had positive effect on continued intention to use mobile shopping services (β = .836, t = 14.362, p-value < .001). This study results suggest that variety seeking and time sensitive consumers perceive that mobile shopping channel fulfills their needs. This study also found that these specific motivations could increase the degree of mobile shopping channel compatibility, resulting in continued intention to use the mobile shopping channel. The findings of this study enable academics and retailers to understand consumer situational motivations in using the mobile shopping channel and serve to help retailers develop mobile shopping services and apps meeting consumer needs in different situations.