Customer evaluations of service organizations' penalties: An integrative framework based on cognitive, affective, and behavioral responses

Faced with a competitive market environment, an increasing number of service organizations are using penalties as an essential means of increasing revenues. Because customers' responses to penalties are usually negative, it is very important that service organizations make efforts to manage penalty policies and penalty incidents. This dissertation develops an integrative framework to explain customers' responses to penalties based on well-established theories. Concepts from attribution theory, operant conditioning theory, social justice theory, and expectancy disconfirmation are used to explain customers' cognitive, affective, and behavioral responses. The study examines the effects of attribution and penalty attributes on customers' perceptions of justice and the effects of perceived justice on dissatisfaction/satisfaction judgments. Also, the study investigates the role of dissatisfaction with penalties in overall satisfaction judgments and behavioral intentions (e.g., intentions to repurchase, intentions to engage in negative word-of-mouth).; This research uses a cross-sectional survey design and collects data online using the critical incident technique. The proposed model was estimated using two-stage least squares regression.; The results showed that different penalty attributes influence the three dimensions of perceived justice differentially and that perceived justice affects customers' dissatisfaction/satisfaction with penalties. The results have implications for both researchers and marketing practitioners. The study concludes with guidelines designed to help organizations to establish “penalties” that fit their customers' “crimes.”...