Perceived justice and perceived loss influence toward customer satisfaction in service recovery: The impact on trust and switching intention

This study is an extension of earlier research on the effect of perceived justice and perceived loss on customer satisfaction during service recovery after service failure. Variables that are likely to impact customer behaviour in the future (trust and (non) intention to switch), once a customer is satisfied with the remedy are identified. Data was obtained from 242 respondents who had experienced service failure, from among customers of a prepaid card of the cellular company, PT.X. The approach used are convenience sampling and snowball sampling. Quantitative data analysis was performed using Structural Equation Modeling (SEM) was and results showed that all variables had a positive effect; the coefficient of determination was shown in the distributive justice, meaning that distributive justice was the biggest variable with a positive and significant effect compared with other variables in this study. Although the ‘perceived loss’ variable had a positive value, its weightage was lesser than other variables. The SEM test results showed that the combined variables in this research, distributive justice, procedural justice, interactional justice, and the perceived loss, have a positive and significant impact on customer satisfaction in service recovery. The variables also have an impact on trust and switching intention. Therefore, in order to increase trust and reduce switching intention, it is important to consider the strongest variables that influence customer satisfaction.