Abstract:It is difficult to control service quality for any service firm and service failure is inevitable due to human or non-human factors. As a result, service recovery stirred the interest of researchers and practitioners. However, service failure may not be identified by firms because a majority of dissatisfied customers will not complain to the service provider. Thus, this research proposes a proactive customer feedback mechanism comprised of proactive solicitation of customer feedback, customers providing feedback and follow-up communication and examine their impact of customer evaluations in the context of service failure. This research tries to establish that through adding a continuous series of satisfied service encounters or "moment of truth" to service failure encounters, the customer evaluations (e.g. satisfaction, trust, purchase intent and positive WOM) toward the service will be significantly improved. Our research employed a 2×2×2 between subjects experimental design. Three independent variables were manipulated as presence and absence level, that is, firms either proactively solicitted customer feedback or employed no solicitation of feedback, Customers either provided feedback to the service firm or refused to provide feedback, and service firm either conducted follow-up communication or no follow-up communication. Our research adoptted a scenario in the context of patronizing a three-star hotel on a business trip. In total, 221 business administration graduates from a famous university in Shanghai participated in the experiment. MANOVA was used to test the hypotheses. The results indicated that proactive solicitation significantly influenced trust (p<0.01). Besides satisfaction, the other dependent variables such as trust, purchase intent and positive WOM significantly differred between with and without follow-up communication groups (p<0.05). Third, a significant difference was detected regarding satisfaction, trust, purchase intent and positive WOM between customer providing feedback groups and no customer feedback groups (p<0.05). Moreover, significant interactive effects were found of customers provided feedback and follow-up communication on trust and purchase intent. Trust and purchase intent reached highest when a follow-up communication occurred after customers provided feedback. However, no interactive effects were found of proactive solicitation of customer feedback and customer providing feedback. This research suggests that service providers should create new encounters with customers when they are confronted with service failure, and in this study, through proactive customer feedback mechanism. That is, first, the service provider should encourage customers to provide feedback, which can improve customer evaluations after service failure and after customers providing feedback. At the same time, the firm should employ follow-up communication with the customer and inform them about how the firm responded to their complaints, suggestions and comments. It is worth to note that companies just need to have follow-up communication with those customers who have provided feedback. More important, as information technology and internet prevails, it is very likely sending email and short messages after a service failure to maintain customer relationships could significantly enhance customer evaluations of the service provider. Of course, how consumers respond to such measures online is an promising research area and needs further investigation.