The psychology behind the service recovery paradox

Customer service advice often comes with a mindset geared towards issue prevention. Naturally, you don’t want customers to encounter problems with your service or product.

But, unfortunately, mistakes and issues are a fact of life ­— they aren’t always avoidable no matter how great your team, or how strong your offering.

The good news is, a customer experiencing an issue needn’t be the catastrophe you assume. In fact, issues often present opportunities to drive loyalty and boost customer opinions of your business.

How? It all comes down to the service recovery paradox.

The service recovery paradox

The service recovery paradox is the phenomenon in which a customer feels better about a company after they’ve solved a problem with the service or product, than if there had been no problem at all.

Issues with products and services can cause customers to swap to a competitor. Or leave negative reviews. But, successful recovery from such failures has the opposite effect.  If done well, service recovery stands to increase customer loyalty — beyond what it would have been had there been no issue.

In short, the service recovery paradox sees post-failure satisfaction elevated higher than pre-failure satisfaction. Provided, that is, that a successful service recovery has been achieved.

Customer empowerment

All humans have a need to feel heard and understood. And effective service recovery meets this need.

After all, you’ve empowered your customers to share their views and issues. You’ve listened to what they’ve said. Most importantly, you’ve understood (and cared) enough to know how to fix the issue.

So, one element in the psychology behind the service recovery paradox is the gratification you create by making your customers feel heard and supported.

Plus, enabling your customers to get in touch in the first instance can be empowering – particularly if you make contact quick and easy. (By offering various contact channels to choose from, for example, with a mix of real-time options.)

Simply by being able to speak to a real person when they need to, the customer has more of a chance to share their views directly. Which, in turn, can be a soothing factor that alleviates the drive to leave negative reviews or defect from your business.

Perceived justice

Effective service recovery also speaks to the customer’s sense of perceived justice.

Customers facing issues feel a need to be made whole again. It isn’t fair that they’ve been let down by the product or service — and when that’s addressed, it meets the human need for justice.

There are three components to perceived justice.

  • Procedural justice

Procedural justice is how fair the customer views the procedure of resolving the issue. Was it easy to get in touch with the right person to address the issue? How much effort do they need to exert to put the agreed recovery solution in place?

  • Interactional justice

Interactional justice relates to the way the recovery outcomes are presented. In other words, the conversations, empathy, effort, and such involved in finding a solution.

  • Distributive justice

Finally, there’s distributive justice. This is whether the customer views the solution or compensation as adequate to offset the costs, impact and inconvenience of the service or product failure.

Effective service recovery, then, makes the customer whole. They get gratification from the sense of justice when you make things right. It makes them feel good — you have made them feel good. You’ve demonstrated that you are fair and know how to make things right. And these factors contribute to the service recovery paradox.

Reliability and trust

In a similar vein, you being there to be accountable for issues also demonstrates your reliability to customers.

Where before customers could only assume that the product or service comes from a reliable source, effectively fixing it when things go wrong proves that reliability. This, in turn, builds trust.

Customers can trust that you will be there when and if they need you.

Achieving service recovery

The psychology behind the service recovery paradox highlights not only why the paradox occurs, but a few tips to ensuring an effective service recovery.

First, there’s the need for accessibility. It’s important to make it easy for customers to reach your team, and to ensure that there’s someone there to answer when they reach out. This answers to the sense of procedural justice, the need to be heard, and the demonstration of reliability.

Then, there’s the emphasis on empathetic service. Empathy is how you show how you’re listening; it’s about making a human connection. This answers the psychological need to be heard.

Third, it’s important to consider how you’ll make the customer whole. This means solving the problem, but also being able to go that extra mile from time to time. Agents need to be empowered to offer compensation for example. (Though not every situation calls for compensation.)

The service recovery paradox

It goes without saying that the service recovery paradox doesn’t mean you should create problems to solve. Rather, it highlights the fact that a customer problem isn’t the end of the road. Rather, it’s an opportunity to not only make things right, but make them better.

In short, the service recovery paradox makes clear the need for accessible, empathetic, effective service. It’s more than solving problems — it’s making connections with customers.

Useful links

Small but mighty: the power of brand advocacy

Embracing the omnichannel contact centre

Agent empowerment: what is it, and why is it so important?