Can corporate social responsibility and recovery justice restore customer identification following service failure?

Purpose: Customer identification is a deep psychological response that plays a crucial role in building customer relationships. However, research relating to how customer identification can be maintained when a service firm fails is limited. Drawing on cognitive appraisal theory, this study aims to examine how the service recovery and corporate social responsibility (CSR) performance of a firm interact to help in cognitive appraisal following service failure to restore customer identification. This study also delineates customer participation as a coping strategy that moderates their collective effect on identification. Design/methodology/approach: To test the hypothesized relationships, a mixed-methods approach was used, using a field survey of 354 service consumers who experienced service failures and recoveries in diverse service settings, followed by two 2 × 2 × 2 between-subjects experiments with a total of 437 participants. Findings: Results confirm the vital roles of recovery justice and CSR performance in maintaining postfailure customer identification. This, in turn, fosters positive behaviors in the postrecovery phase, including increased support for CSR initiatives and decreased likelihood of customer switching. Importantly, CSR performance, as a cognitive resource stored in the prerecovery phase, can compensate for unjust recovery during cognitive appraisal in the postrecovery phase. The findings also highlight the potential of customer participation as a coping strategy to augment the compensatory effect of CSR performance on recovery justice, thereby strengthening customer identification. Originality/value: This study introduces a framework for restoring customer identification in the postrecovery phase of service recovery. The findings shed new light on how tactics such as good CSR performance and customer participation can regulate the influence of recovery efforts in a way that helps restore customer identification and promote favorable postfailure behaviors.