ABSTRACT
The major objective of this study was to investigate the relationship between service recovery strategies and customers’ patronage of domestic airlines in the south-south geo-political zones of Nigeria. The specific objectives were: to ascertain the relationship between Customer Complaint Management (CCM) and domestic airlines referral in South-South Geo-Political zone of Nigeria; to ascertain the relationship between Speed of Recovery (SR) and domestic airlines retention in South-South Geo-Political Zone of Nigeria; to evaluate the relationship between Rebooking Flight (RF) and domestic airlines loyalty in South-South Geo-Political Zone of Nigeria; to ascertain the relationship between apology to customers and domestic airlines repeat purchase in South-South geo-political zone of Nigeria; to ascertain the relationship between use of Discount (PD) and domestic airlines brand satisfaction in South-South geo-political zone; and to ascertain the relationship between airline passengers disposition and domestic airline patronage in South-South geo-political zone. The study employed correlational research design. The population of the study comprised all domestic airline passengers in the south-south geo-political zone. The researcher conveniently and purposively selected 40 air-passengers of different airlines in the five airports in the geo-political zone to respond to the copies of the questionnaire that were administered. The sum total was 200 copies of structured questionnaire that were administered and subsequently used for analyses. This study adopted face and content validity. The researcher subjected the instrument of the study to test-retest method by administering some copies of the questionnaire to some groups. The study results showed that customer complaint management has a positive and strong relationship with domestic airlines referral in South-South Geo-Political zone of Nigeria. It was also revealed that a strong, positive and highly significant relationship exists between service recovery speed and domestic airlines retention in South-South Geo-Political zone of Nigeria. The study also revealed that rebooking flight has a positive and strong relationship with domestic airlines loyalty in South-South Geo-Political zone of Nigeria. Based on the study findings, it was recommended that airlines in the South-South Geo-Political zone of Nigeria should ensure that they have service recovery strategies in place, as service failures are very likely to occur in the airline industry. By failing to adequately address service failures, airlines may damage their relationships with their customers, possibly leading to customers defecting to competitor airlines. This could potentially result in customers never flying with the airline again, or at best flying with the airline less frequently than before experiencing the service failure. In conclusion, service recovery strategies and customers’ patronage of domestic airlines in the south-south geo-political zones of Nigeria are positively correlated.
TABLE OF CONTENTS
Title Page i
Declaration ii
Certification iii
Dedication iv
Acknowledgement v
Table of Contents vii
List of Tables xi
List of Figures xii
Abstract xiv
CHAPTER 1: INTRODUCTION 1
1.1 Background to the Study 1
1.2 Statement of the Problem 2
1.3 Objectives of the Study 3
1.4 Research Questions 4
1.5 Research Hypotheses 4
1.6 Significance of the Study 5
1.7 Scope of the Study 5
1.8 Limitations of the Study 6
1.9 Operational definition of Terms 6
CHAPTER 2: LITERATURE REVIEW 8
2.1 Conceptual framework of service recovery strategies and customer
patronage of domestic airline 8
2.1.1 Concept of service recovery strategies 9
2.1.2 Service failure 12
2.1.3 Causes of service failure in airlines 13
2.1.4 Severity of service failure 14
2.1.5 Role of service 15
2.1.6 Service encounter 15
2.1.6.1 Importance of service encounter 16
2.2 Service Quality 16
2.2.1 Measuring service quality 19
2.2.2 Criticism of SERVQUAL 20
2.2.3 Service performance 22
2.3 Airline Industry in Nigeria 22
2.3.1 Airline service quality 23
2.3.2 Customer satisfaction and loyalty in airlines 24
2.3.3 Service failure and recovery in airlines 25
2.4 Customer complain management (CCM) 26
2.4.1 Speed of recovery (SR) 28
2.4.2 Rebooking flight (RF) 29
2.4.3 Future discount (FD) 30
2.4.4 Apology (A) 31
2.5 Customer Patronage 33
2.5.1 Air brand satisfaction (ABS) 33
2.5.2 Airline retention (ART) 35
2.5.3 Airline loyalty (ALT) 36
2.5.4 Airline repeat purchase (ARP) 37
2.5.5 Airline referrals (ARE) 38
2.6 Customer Compliant Management and Customer
Patronage (CCM and CP) 39
2.6.1 Speed of recovery (SR) and customer patronage (CP) 41
2.6.2 Rebooking flight (RF) and customer patronage (CP) 42
2.6.3 Use of discount (UD) and customer patronage (CP) 42
2.6.4 Apology (A) and customer patronage (CP) 43
2.7 Review of Related Theories 44
2.7.1 Attribution theory (Flitz Heider, 1958) 44
2.7.2 Equity theory (Adam Smith, 1963) 45
2.7.3 Social exchange theory (Tribant and Kelly, 1952) 46
2.7.4 Service recovery paradox theory (McCollogh and Bharadwas, 1992) 46
2.7.5 Justice theory (Pauler, 2011) 47
2.8 Review of Empirical Studies 48
2.8.1 Service recovery 48
2.9 Summary of and Gap in the Literature 51
2.10 Gap in Literature 52
CHAPTER 3: RESEARCH METHODOLOGY 54
3.1 Research Design 54
3.2 Area of the Study 54
3.3 Population 55
3.4 Sample Size Determination 55
3.4.1 Sampling Procedure 55
3.5 Data Collection Method 56
3.6 Instrument Design 56
3.7 Validity of the Instrument 57
3.8 Reliability of the Instrument 57
3.9 Data Analysis Techniques 58
3.10 Model Specification 58
CHAPTER 4: RESULTS AND DISCUSSION 61
4.1.1 Questionnaire distribution and retrieval 61
4.1.2. Gender of the studied domestic airline passengers in the south-south
geo-political zone of Nigeria 61
4.1.3. Age bracket of the studied domestic airline passengers in the south-south
geo-political zone of Nigeria 62
4.1.4. Marital status of the studied domestic airline passengers in the south-south
geo-political zone of Nigeria 62
4.1.5. How long have you been flying from any part of south-south of Nigeria? 63
4.2 Analyses of Data 71
4.2.1 Relationship between customer complaint management (CCM) and
domestic airlines referral in south-south geo-political zone of Nigeria 71
4.2.2 Relationship between speed of recovery (SR) and domestic airlines
retention in south-south geo-political zone of Nigeria 72
4.2.3 Relationship between rebooking flight (RF) and domestic airlines loyalty
in south-south geo-political zone of Nigeria 73
4.2.4 Relationship between apology to customers and domestic airlines repeat
purchase in South-South geo-political zone of Nigeria 74
4.2.5 Relationship between use of discount (UD) and domestic airlines brand
satisfaction in south-south geo-political zone 75
4.2.6 Relationship between airline passengers’ disposition and domestic airline
loyalty in south-south geo-political zone 76
4.3 Discussion of Result 76
CHAPTER 5: SUMMARY, CONCLUSION AND RECOMMENDATIONS 80
5.1 Summary of Findings 80
5.2 Conclusion 81
5.3 Recommendations 82
5.4 Contribution to knowledge 84
5.5 Areas of future research 84
References 86
Appendices 101
LIST OF TABLES
2.1 List of functional airlines in Nigeria 23
3.1 Reliability analysis of the variables 57
4.1 Questionnaire distribution and retrieval 61
4.2. Frequency distribution showing the gender of the studied
domestic airline passengers in the south-south geo-political
zone of Nigeria 61
4.3. Frequency distribution showing the age bracket of the studied domestic
airline passengers in the south-south geo-political zone of Nigeria 62
4.4. Frequency distribution showing the marital status of the studied domestic
airline passengers in the south-south geo-political zone of Nigeria 62
4.5. Frequency distribution showing responses on the number of years the
studied domestic airline passengers have been flying from parts of the
south-south geo-political zone of Nigeria 63
4.6. Frequency distribution showing responses on customer complaint
management (CCM) 64
4.7. Frequency distribution showing responses on speed of recovery (SR) 64
4.8. Frequency distribution showing responses on rebooked flight (RF) 65
4.9. Frequency distribution showing responses on use of discount (UD) 66
4.10. Frequency distribution showing responses on apology (A) 66
4.11. Frequency distribution showing responses on air brand satisfaction (ABS) 67
4.12. Frequency distribution showing responses on airline retention (ART) 68
4.13. Frequency distribution showing responses on airline loyalty (ALT) 68
4.14. Frequency distribution showing responses on airline repeat purchase (ARP) 69
4.15. Frequency distribution showing responses on airline referrals (ARE) 69
4.16. Frequency distribution showing responses on social status of air passengers 70
4.17 Correlation coefficient showing the relationship between customer
complaint management (CCM) and domestic airlines referral in
south-south geo-political zone of Nigeria 71
4.18 Correlation coefficient showing the relationship between speed of
recovery (SR) and domestic airlines retention in south-south geo-political
zone of Nigeria 72
4.19 Correlation coefficient showing the relationship between rebooking
flight (RF) and domestic airlines loyalty in south-south geo-political
zone of Nigeria 73
4.20 Correlation coefficient showing the relationship between apology
and domestic airlines repeat purchase in south-south geo-political
zone of Nigeria 74
4.21 Correlation coefficient showing the relationship between use of
discount (UD) and domestic airlines satisfaction in south-south
geo-political zone 75
4.22 Correlation coefficient showing the relationship between airline
passengers’ disposition and domestic airline loyalty in south-south
geo-political zone 76
LIST OF FIGURES
2.1. Schematic framework of service recovery strategies and
domestic airline patronage 8
2.2. Service gaps 19
3. Operational framework of the relationship between service recovery
strategies and customer patronage 53
4. Heuristic model of the relationship between service recovery
strategies and customer patronage 84
CHAPTER 1
INTRODUCTION
1.1 BACKGROUND TO THE STUDY
The major objective of services marketing is to ensure maximum customer satisfaction. Many researchers have emphasized the importance of customer satisfaction in the service industry (Johnson, 2011; Singh, 2013; Zeithmal, Bitner and Gremler, 2006). It is a well-known fact that service quality affects customer perception. However, in view of the characteristics of services namely Heterogeneity, intangibility, inseparability and perishability, it is difficult to manage the quality dimensions of provided services like tangible goods. Usually, those obstacles on the way of customer satisfaction are significant. Those obstacles are called “Service Failures” and are inevitable within the service provision process (Hart, Heskett and Sasser, 1990). To get the customers back and get them satisfied, service providers have a second chance that is called “Service Recovery”.
A well planned and effective service recovery strategy has positive impact on customer repurchase and referral intentions (Bitner, Booms and Tetreeaults, 1990; Komunda and Osarenkhoe, 2012; Morgani and hunt, 2014), enhanced quality perceptions (Michael Brown and Johnson, 2019) and employee satisfaction (Tax and Brown, 2000). On the other hand, inefficiencies in resolving failures can destroy customer satisfaction, resulting in exit behaviour and might trigger harmful WOM action (Edvardson, 2011).
Keeping current customer happy is less expensive than acquiring new ones (Triwaites and Williams, 2006). A fruitful service recovery also revitalizes the bottom line (financial) performance, whereas an ineffective or not attempted recovery damages. Failures are inevitable, it is important to have an effective recovery mechanism to overcome the failures. As mentioned, it is not possible to prevent service failure (Hart, Heskett and Sasser, 2014). In view of this, service recovery is a must for quality and satisfying customer (Oloruniwo, Hsu and Udo, 2006). It is five times more cheaper to retain existing customers than to have new ones (Thwaites and Williams, 2013). In addition, customers who receive no recovery or unsatisfactory attempt by the service provider firm may talk to about ten to twenty people about their bad experiences, only about five people learn about successful recovery efforts of the firm (Morhson and Huppertz, 2010, Sousa and Voss, 2009). It is important for the service provider to employ effective service recovery strategies to alter undesirable consequences of failure (Maxham, 2002). A perfect recovery strategy is essential for organizations to advance in customer retention by resolving the failure condition (Berry and Parasurama, 1992).
1.2 STATEMENT OF THE PROBLEM
Recovery strategies in airline industry have recently received considerable research attention (Smith, Bolton and Wagner, 2017; Tax Brown and Chandrashekaran, 2018; Spark and McColl-Kennedy, 2001) in view of its critical impacts on customer satisfaction. However, researchers are limited to investigate those actions taken by airline operators that leads to customer patronage and repeat purchase when a service failure occurs.
My motivation for this study is based on a personal experience that I had some years back when a booked flight from Lagos to Port-Harcourt was first delayed for over 8 hours before taking off to Abuja instead of Port-Harcourt for reasons best known to them. Upon landing in Abuja, customers complained and the management had to tender an apology and strategically aligned with another airline to convey some passengers back to Port Harcourt. The remaining passengers were lodged in a nearby hotel which they paid for with dinner. Apart from this action taken by the management, they also offered us 25% discount subsequently.
Given the above, could it be that the effective handling of recovery strategies of customer complaint management, speed recovery, future discounts are key ingredients for customer patronage when there is service failure in the airline industry?
Moreover, the above assertion may not be far from the truth as studies have proved it right. Thus, a simple text of future discount/rebooking will win back a dissatisfied customer and lead to repeat purchase. It is however, against this backdrop that we intend to bring together service recovery strategies and investigate if customer complain management, future discount, speed of recovery etc can influence customer patronage. In this case, we investigated if it is possible to conceptually and empirical integrate service recovery strategies within the plethora of literature of customer patronage.
1.3 OBJECTIVES OF THE STUDY
The major objective of this study was to investigate the relationship between service recovery strategies and customers’ patronage of domestic airlines in the South-South geo-political zones of Nigeria.
The specific objectives were:
i) to ascertain the relationship between Customer Complaint Management (CCM) and domestic airlines referral in South-South Geo-Political zone of Nigeria,
ii) to ascertain the relationship between Speed of Recovery (SR) and domestic airlines retention in South-South Geo-Political Zone of Nigeria,
iii) to evaluate the relationship between Rebooking Flight (RF) and domestic airlines loyalty in South-South Geo-Political Zone of Nigeria,
iv) to ascertain the relationship between apology to customers and domestic airlines repeat purchase in South-South geo-political zone of Nigeria,
v) to ascertain the relationship between use of discount (UD) and domestic airlines brand satisfaction in South-South geo-political zone,
vi) to ascertain how airline passengers’ disposition moderates the relationship between service recovery strategies and domestic airline patronage in South-South geo-political zone.
1.4 RESEARCH QUESTIONS
The following research questions were fundamental in achieving the objectives of the study:
i) What is the relationship between Customer Complaint Management (CCM) and domestic airlines referral in South-South Geo-Political zone of Nigeria?
ii) What is the relationship between Speed of Recovery (SR) and domestic airlines retention in South-South Geo-Political Zone of Nigeria?
iii) What is the relationship between Rebooking Flight (RF) and domestic airlines loyalty in South-South Geo-Political Zone of Nigeria?
iv) What is the relationship between apology to customers and domestic airlines repeat purchase in South-South geo-political zone of Nigeria?
v) What is the relationship between Use of Discount (UD) and domestic airline brand satisfaction in South-South geo-political zone of Nigeria?
vi) How does airline passengers’ disposition moderate the relationship between service recovery strategies and domestic airline patronage in South-South geo-political zone?
1.5 RESEARCH HYPOTHESES
The following hypotheses were stated in a null form guide the study.
Ho1: Customer Complaint Management (CCM) does not have any significant relationship with domestic airlines referral in South-South Geo-Political zone of Nigeria.
Ho2: Speed of Recovery (SR) does not have any significant relationship with domestic airlines retention in South-South Geo-Political Zone of Nigeria
Ho3: Rebooking Flight (RF) does not have any significant relationship with domestic airlines loyalty in South-South Geo-Political Zone of Nigeria.
Ho4: Apology to customers does not have any significant relationship with domestic airlines repeat purchase in South-South geo-political zone of Nigeria
Ho5: Use of Discount does not have any significant relationship with domestic airlines brand satisfaction in South-South geo-political zone
Ho6: Airline passengers’ disposition does not moderate the relationship between service recovery strategies and domestic airline patronage in South-South geo-political zone.
1.6 SIGNIFICANCE OF THE STUDY
The study on service recovery strategies and customer patronage of domestic airlines in South-South geo-political zone is of immense benefits to airline operators in the zone and Nigeria at large. Particularly, their management echelon in the sense that it will reduce service failures to the bearest minimum and when it occurs, there will be little to worry about because they will recover from the perceived failure and win back their customers.
This study will enable the management team of domestic airlines understand the importance of customer complain management, speed of recovery, rebooked flight, future discount and explaining to customers when any failure occurs because failure is inevitable in service delivery.
Conversely, the study will assist passengers in deciding air brand, when they are travelling based on actions taken if there were issues of service failure. Lastly, the study will add to existing stock of literature as interested researchers will benefit from it.
1.7 SCOPE OF THE STUDY
The scope of this study was captured from three (3) perspectives, namely: content, geographical and unit of analysis.
a) Content Scope: This study literature bordered on services marketing and behaviour of customers in making key decision of patronage when an airline has failed in their expected service and taken action to win back the customers.
b) Geographical Scope: The study was limited to domestic airlines operating within the south-south geo-political zone.
c) Unit of Analysis Scope: The work was of a micro unit of analysis as information from domestic airlines was used in the study.
1.8 LIMITATIONS OF THE STUDY
The study suffered some constraints that could affect the accuracy and generalization of its findings if not handled appropriately. First of such constraints was that the study was conducted within domestic airlines, hence the findings were peculiar to the sector. This therefore implies that the findings may not be applied to/or obtained in other spheres of services or in international airline.
Moreover, sensitivity of sample elements is another constraint that affected the generalization of findings, as humans are prone to behave differently when approached by researchers. Closely related is the issue of respondents’ bias which may affect the veracity of results.
1.9 OPERATIONAL DEFINITION OF TERMS
a) Service recovery strategy: Service recovery Strategy is the critical steps for transforming dissatisfied customers into satisfied ones.
b) Airline customer patronage: This is the act of purchasing the services of a preferred/particular airline when there is need for air travelling or other air services.
c) Customer complaint management: Customer complaint management is the responses triggered by perceived dissatisfaction that is neither psychologically accepted nor quickly forgotten in the consumption of a product or service.
d) Speed of recovery: This involves the promptness in salvaging the dissatisfied customer.
e) Rebooking flight: This is making provisions for the next available/alternative flight.
f) Future discount: This is the reduction in value of a certain percent to the customer when next the customer is flying.
g) Apology: Making a logical and concise statement on why the dissatisfaction happened.
h) Air brand satisfaction: This indicates the fulfilment that airline passengers derive from using a particular brand of airline.
i) Airline loyalty: This refers commitment to the affairs of airlines that reflects customer consistency of their air brand overtime.
j) Airline repeat purchase: The act of customer coming back upon being satisfied by the airline.
k) Airline referrals: This involves being an apostle of an airline by way of recommendation an airline to others that needs airline services.
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