The Benefit of Becoming Friends: Complaining after Service Failures Leads Customers with Strong Ties to Increase Loyalty

Abstract

Service firms spend considerable resources soliciting complaints to initiate recovery efforts and improve their offerings. However, managers may be overlooking the fact that complaints serve an equally important role in engendering loyalty. The authors demonstrate that the strength of social ties between customers and service providers influences the degree to which complaining drives loyalty. Paradoxically, while strongly tied customers fear that complaining threatens their ties with the provider, when they are encouraged to complain, their loyalty increases because offering feedback serves as an effective way to preserve social ties. Conversely, for weakly tied customers, complaining has no effect on loyalty. Furthermore, complaints are more effective in driving loyalty for strongly tied customers when the feedback is directed toward the provider who failed, rather than to an entity external to the failure. Finally, when providers signal an authentic openness to feedback, strongly tied customers are more loyal after complaining, whereas authenticity does little to engender loyalty for weakly tied customers who complain. The value of complaints in driving loyalty is promising both for customers who perceive a strong tie to a particular provider within the firm and, more generally, in service industries wherein strong ties naturally occur.