Service Recovery and Consumer Satisfaction in Indian Telecom Industry : Findings from a Study Using Discriminant Analysis

Present study tests the conceptual model which states that to ensure a successful service recovery, a service firm should communicate effectively with the aggrieved customer, be empathetic, provide feedback, offer an explanation of what went wrong, empower employees who receive complaints to solve the problem that the customer complained about, and ensure that staff are appropriately dressed and appear professional in terms of the appearance of their working environment that elements of service recovery construct do not equally influence the resulting satisfaction. The present study is conducted in telecommunication sector in India. To test the hypothesis data was collected from 200 respondents across three service providers, i.e., Airtel, BSNL and Vodafone, using RECOVSAT. The results of discriminant analysis resulted in 2 functions. These results highlighted the relative importance of atonement, empowerment and feedback in service recovery efforts. Results further highlighted that for cluster 3, i.e., satisfied customers loaded positively on the 3 dimensions of function I namely atonement, empowerment and feedback. These results indicate that as companies focus their strategies on these variables customers move from being dissatisfied with the companies' service recovery efforts to being satisfied with the company's service recovery efforts. The recommended service mix was tested for three service providers in telecom industry i.e. Vodafone, Airtel and BSNL. Though all the three companies are involved in service recovery efforts the results indicated that Vodafone had best service mix in terms of function I and also had maximum percentage of customers satisfied from its complaint process and service recovery efforts. Despite their efforts BSNL and Airtel were not doing so well because they were investing in Function 2 of the service recovery mix. Therefore, a focus in service recovery strategies would help service providers gain satisfaction in service recovery efforts and also have an impact on the customers emotions and future behavior. This would help companies get maximum impact on perceptions of customers within the limits of a marketing budget