When do customers offer firms a “second chance” following a double deviation? The impact of inferred firm motives on customer revenge and reconciliation

•Inferred negative motive mediates the effect of blame, severity, and fairness on anger.•Customer anger mediates the effect of inferred motives on desire for revenge.•Firms can stress positive motives to reduce customer anger and desire for revenge.•Firm actions (i.e., apologies and compensation) can help convey positive motives.•We show that firms can still earn a second chance after failed service recovery.

The present research develops and tests a theory explaining how customers respond to failed service recoveries (i.e., double deviations). This work offers three novel and important conclusions. First, inferences about a firm's motive (negative vs. positive) mediate the impact of perceptions of the double deviation (i.e., severity, blame, and fairness) on resulting outcomes (i.e., customer anger, desire for revenge, and desire for reconciliation). Second, when inferred motive is positive, desire for reconciliation overwhelms desire for revenge, leading customers to choose more reparatory than retaliatory behaviors. Third, following a double deviation, firms that both compensate and apologize to customers can change customers’ inferred motives from negative to positive, leading customers to desire more reconciliation than revenge, and engage in more reparatory than retaliatory behaviors. These studies demonstrate that, contrary to common wisdom, customers do not always respond negatively to a double deviation, and firms still have a “second chance” following a failed recovery.

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