Repeated Frontline Interactions in Retailing

Retail transactions often involve interactions between a frontline employee (FLE) and a customer. This study investigates the impact of repeated customer interactions with the same FLE. Using transaction data from a large international car rental company, we show via instrumental variables estimation that repeated customer interactions with the same FLE leads to improved customer satisfaction outcomes. Furthermore, these positive effects are especially pronounced when the customer's experience with the previous transaction is favorable. Furthermore, we show that the repeated interaction effects are strong enough to offset the negative impact a service disruptions might have had on customer satisfaction. However, repeated interactions may not be a universally desirable factor, as they could magnify the negative effects that stem from low quality service experienced in the past. Finally, we demonstrate the existence of various boundary conditions for the impact of repeated interactions