Service Recovery: A Cure for Service Failure
Buying a Pig in a Poke: How It Annoys Everyone
Buy a pig in a poke, or more familiar in the Indonesian language with “membeli kucing dalam karung”, is buying goods or services whose condition is unknown. According to the Oxford dictionary, buy a pig in a poke itself is an idiom for something that is bought or accepted without first being seen or assessed. You can imagine what will happen next right after received or used the product but it was not as you were expected before. Sad? Disappointed? I might personally stop using the product and not recommend it to my family and friends.
An experience like this might have happened to several people, including me. One day I was on my way to the office and an unknown number called my phone. It was a man from a telecommunication company offered a postpaid product and asked me if I’m willing to migrate my prepaid number with their postpaid. Since the lack of knowledge about the product, I asked him to explain their program and all the benefits that I am going to have because I believe nobody wants to buy a pig in a poke, correct?
To be honest, for me telesales is (sometimes) annoying but quite helpful when I want to know more but I don’t have time to browse every information.
The story still continues. I asked him to explain the postpaid program in every aspect clearly. He started to introduce himself again as an official call from a well-known telecommunication company in Indonesia. Then, he started to explain the postpaid migration program and its benefits which previously I wasn’t interested because I was afraid the bills would “explode” when I can’t control the usage. However, he assured me for not to worry because when the migration process succeeds, the auto-stop feature will automatically on if I reached my monthly limit. As a result, I became interested to migrate my number to be a postpaid service. Hence, I followed several instructions for the validation process and then voila! my postpaid migration was done quickly. My number was instantly activated as a postpaid number and I could enjoy the added-value benefit in three days after the migration process.
After several days go, I was disappointed with the product because it’s monthly limit was different from the offers at the beginning. Shortly, I confirmed the migration to my old-friend who work at that telecommunication company. She explained that the availability of monthly data service was not completely full service. Almost half of the data limit that I receive every month will be allocated for entertainment purposes. The validity of this information was also supported after I reconfirmed to their customer service on Twitter. I believe the telesales officer provide the wrong information about the product that I used. As a loyal customer, of course, I felt disappointed because I bought a pig in a poke.
Given these points, I threw my issue to their customer service thru Twitter and it was not easy. It takes a lot of explanation and validation process from the provider to ascertain whether there was an error when the telesales informed me about the product or issues from my side which I had not been aware of. Along with the conversation, I ensured the customer service that the prior information given from the telesales officer is different. In the first place, the customer service apologized and informed me repeatedly that the product I used has an allocation for entertainment purposes only. More and more again, I tell the customer service that the telesales was not informing those details. Straightaway, I was told to the customer service to check my conversation records with the telesales officer to make sure if there is something missing or not. Finally, they accepted my explanation and informed me that the issues will be checked for 3 x 24 hours.
A few days later, the customer service contacted me by phone and informed that there was misinformation from the telesales officer which did not inform the product correctly. The officer should inform the complete information before making the agreement with the customers. The service provider also apologized for my issue and they provided free additional services as a service recovery with the hope that I would remain to be their loyal customer. Personally, I am satisfied that they can solve their failure service and do a recovery that really blows out of my expectation. This experience made me realize that service recovery is important to recover bad experiences and boost customer satisfaction right after a service failure.
What is Service Recovery?
Zemke & Bell describe service recovery as a process for returning aggrieved customers to a state of satisfaction with the organization after a service or product has failed to live up to expectations. Schweikart et al. view service recovery as part of quality management and that the ultimate objective of it all is to maintain the business relationship with the customer. This contention is based on the premise that customer satisfaction ensures customer loyalty, repeat sales, and positive word-of-mouth communication (Bearden & Teel, 1983). (1)
Customer satisfaction is an individual’s feelings of pleasure or disappointment resulting from comparing the perceived performance (or outcomes) of the service provided in relation to his or her expectations. Satisfaction can be associated with feelings of acceptance, happiness, relief, excitement, and delight, which claims that when consumers receive service that is better than expected, they will be satisfied. Alternatively, a service that is worse than expected leads to dissatisfaction. (2)
For nearly three decades companies have held a common belief that “recovering” after delivering a poor experience earns stronger customer loyalty than if a company delivered an excellent experience in the first place. This concept is called the service recovery paradox (SRP), relying on the assumption that customers appreciate our fallibility and that the act of “making things right” actually strengthens the company-customer bond. (3) Experts agree that a good recovery system helps the firm in turning its unhappy customers into satisfied and happy customers after a service failure. (4) Companies with the best customer service understand the paradox: customers are often more loyal after a service failure (so long as the recovery has been swift and good) than customers who have not experienced a service failure at all. (5)
Service Recovery Paradox
The graph shows how a customer with failed service and get the recovery leads the customer to be more loyal than a customer never experiences the service failure. However, not every service recovery will increase customer loyalty number. According to Vincent P Magnini et al in their paper “The service recovery paradox: justifiable theory or smoldering myth?” found that the impact of service recovery effect is moderated by several attributes of the service failure: (6)
- It doesn’t work as well for customers who have prior failures.
- It doesn’t work as well for big failures.
- It works just as well for old customers as new customers.
- It works better if the customer believes it was beyond your control.
- It works better if customers perceive the issue was not reasonably foreseeable.
According to the disconfirmation theory, satisfaction results when the consumer has an encounter that is better than expected. In service recovery research, two evaluation phases occur. Service recovery starts, by definition, with initial customer dissatisfaction. After this first evaluation, when they determine the service was worse than they expected, customers may go through a recovery process with the firm, which leads to a second evaluation. Yet, mistakes are an unavoidable feature of all human endeavor and thus also of service delivery. Although poor service delivery may initially appear to be a disaster, opportunities abound for service companies to resolve problems, go beyond the call of duty and win a customer for life. In other words, effective customer complaint handling, or service recovery, can turn angry and frustrated customers into loyal ones. (7)
Building the Trust — The Tokopedia Care Way
Solving customer problems sometimes was not as easy as falling off a log. Solving customers problems sometimes require a high level of in-depth analysis, great strategy, and take a different approach so the customers will continue to trust and feel comfortable with Tokopedia. One of Tokopedia Care’s efforts to maintain trust and increase customer satisfaction is by built User Recovery Team (URT). URT team is a team who has a responsibility to take action on customers who feel dissatisfied with the failed services of Tokopedia. The team will start to do recovery once the internal alert system rings, detecting the indication of a bad experience.
Many recovery actions are taken by the URT team to maintain good customer experience. One of which is proactive action if customers issue is already over the service level agreement (SLA) or the case complexity is very high. The actions that are taken including but not limited to calling the users, visiting them, and giving surprises. To do so, firstly, URT team will analyze the case to find its root-cause and then the results will be the groundwork of the next action plan. Alongside, the results of the analysis also can be used as insights for Tokopedia Care to improve the services and maintain the trust of 90 million monthly active customers.
Mr. Cat and Tokopedia Care Service
One day, Mr. Cat, a Tokopedia loyal customer, faced an issue for his shipment. He experienced late shipment because there is no instant-delivery courier picked up his order from the seller which impacted that his package only can be delivered in the next day. As consequences, he was disappointed with the service. Then, he posted his disappointment on social media.
Proactively, Tokopedia User Recovery Team contacted the users after careful preparation was done from the case analysis. At first URT team invited him to have a further discussion at someplace. However, the user refused to do so because he was not in good health condition, so the URT team asked his permission to visit directly to his house and he agreed. URT team came to his house and talked a lot about his problem, Mr. Cat gives some suggestions for Tokopedia because he understands more about the e-commerce industry. This is a good moment for Tokopedia to gather much feedback from Mr. Cat to improve our products and services in order to build the best customer experience. One of his suggestions is for not letting customer service only focus on standard operating procedure (SOP) bu also prioritizing good customer experience, because once the customer is happy then customer then it’ll give a chance to be loyal. Given this moment, the URT team said thanks to Mr. Cat and apologized for any bad experience happened. After all, URT team give him special merchandise, not only one but much to keep him loyal as Tokopedia user.
Without a long wait, he shared his experience of Tokopedia’s visit on his Twitter account. He posted his ‘drama’ about the service experience and Tokopedia’s coming to his house. To make his drama sweeter and cuter, he put his cat, named Tofu, with the surprise gifts from Tokopedia. All things considered, he said that he was a satisfied customer. For this reason, Tokopedia feels glad that the team can keep the customer loyal by making them happy and creating a great customer experience, not only along the transaction process but also post the transaction.
We learned a lot from Mr. Cat, we learned that we have to put our best efforts to retain our customers starting from small steps that may lead to a greater impact as it is known that retaining your customers require less costly than acquiring new ones.
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(1) M. Ibrahim and S. Abdallahamed, ‘Service Recovery and Customer Satisfaction: A Case of Uganda Telecom’, European Journal of Business and Management, Vol.6, №4, 2014, p.198.
(2) Ibid, p.200.
(3) McFarland Andrew. 2019. What is Service Recovery Paradox? And Is It Real? Accessed on https://smartercx.com/what-is-the-service-recovery-paradox-and-is-it-real/.
(4) S. Hassan et al., ‘Impact of Service Recovery on Customer Satisfaction in the Hospitality Industry of Pakistan’, European Journal of Business and Management, vol. 6, no. 23, 2014, pp. 199.
(5) The Service Recovery Paradox accessed on https://www.customerthermometer.com/customer-retention-ideas/the-service-recovery-paradox/.
(6) The Service Recovery Paradox accessed on https://www.infosurv.com/the-service-recovery-paradox/.
(7) M. Ibrahim and S. Abdallahamed, Op. Cit, p.200.
