CSR-authenticity and conciliation after service failure: the role of apology and compensation

Abstract

Purpose This paper aims to explore how authentic corporate social responsibility (CSR) activities can serve as a proactive service recovery tool and shield service providers from the negative consequences of service failures. Specifically, the authors investigate the conditions under which such activities can encourage conciliatory behavior among aggrieved consumers and how adding reactive service recovery tools to the mix interferes with the process. Design/methodology/approach The authors conduct three experiments on an online panel and college student participants. The authors present a service failure scenario at a restaurant (late/subpar food delivery); vary the restaurant’s CSR activity (authentic, inauthentic or nonexistent); and test CSR’s impact on conciliatory behavior, the underlying mechanisms and how reactive service recovery tactics (apology/compensation) moderate the process. Findings The authors find that authentic-CSR activities (relative to inauthentic or no-CSR activities) indirectly promote conciliatory behavior by (serially) making the failure appear as a onetime event and lessening consumer anger toward the service provider. However, the process gets disrupted when the authors add an apology/compensation to the mix, ostensibly because the latter is a more direct signal that the failure is a onetime problem. Originality/value To the best of the authors’ knowledge, this is the first study that tests how authentic-CSR activities can serve as a proactive service recovery tool and encourage conciliatory behavior among aggrieved consumers (a serial mediation process). The authors add value by showing that the process cuts across cultures (with participants from the USA and Turkey) and that CSR activities are indispensable when customers do not complain but simply exit the firm.