Given the large investments required for high-quality complaint handling design, managers need practical guidance in understanding its actual importance for their particular company. However, while prior research emphasizes the general relevance of complaint handling design, it fails to provide a more differentiated perspective on this interesting issue. This study, which is based on an integrative multi-level framework and a dyadic dataset, addresses this important gap in research. Results indicate that the impact of a company’s complaint handling design varies significantly depending on the characteristics of the complaining customers with which the firm has to deal. Further, this paper shows that, contingent on these characteristics, a company’s complaint handling design can shape complainants’ fairness perceptions either considerably or only slightly. Overall, findings suggest that companies should apply an adaptive approach to complaint handling to avoid misallocation of attention, energy, and resources.
This is a preview of subscription content, access via your institution.
Buy single article
Instant access to the full article PDF.
Price excludes VAT (USA)
Tax calculation will be finalised during checkout.
These findings remain stable when estimating a model that only includes main effects, but no cross-level interaction terms.
Moreover, additional analyses show that for both groups of each customer-related characteristic, the estimate for the effect of complaint handling design on perceived fairness is significant.
While our study focuses on the moderating effects of customer characteristics on the impact of a company’s complaint handling design, it is worth mentioning that the interaction effects in our model (see Table 5) can also be interpreted in the opposite way. Specifically, our study also advances academic understanding by suggesting that a company’s complaint handling design influences the impact of customer characteristics. For example, the higher the quality of company’s complaint handling design, the lower is the negative effect of a customer’s perceived severity of the problem, importance of the product, and attribution of responsibility, respectively, on perceived fairness. Thus, high-quality complaint handling may weaken the impact of customer perceptions of the problem. A similar reasoning can be applied to reinterpreting the other interaction effects.
Aiken, L. S., & West, S. G. (1993). Multiple regression: Testing and interpreting interactions (3rd ed.). Newbury Park: Sage.
Ailawadi, K. L., Neslin, S. A., & Gedenk, K. (2001). Pursuing the value-conscious consumer: store brands versus national brand promotions. Journal of Marketing, 65(1), 71–89.
Anderson, N. H. (1981). Foundation of information integration theory. New York: Academic.
Andreassen, T. W. (2000). Antecedents to satisfaction with service recovery. European Journal of Marketing, 34(1/2), 156–175.
Andreassen, T. W. (2001). From disgust to delight: do customers hold a grudge? Journal of Service Research, 4(1), 39–49.
Armstrong, J. S., & Overton, T. S. (1977). Estimating nonresponse bias in mail surveys. Journal of Marketing Research, 14, 396–402.
Bagozzi, R. P., & Yi, Y. (1988). On the evaluation of structural equation models. Journal of the Academy of Marketing Science, 16(1), 74–97.
Bearden, W. O., & Oliver, R. L. (1985). The role of public and private complaining in satisfaction with problem resolution. Journal of Consumer Affairs, 19(2), 222–240.
Belsley, D. A., Kuh, E., & Welsch, R. E. (1980). Regression diagnostics: Identifying influentia data and sources of collinearity. New York: Wiley.
Berry, L. L. (1995). On great service: A framework for action. New York: Free.
Bitner, M. J., Booms, B. H., & Tetreault, M. S. (1990). The service encounter: diagnosing favorable and unfavorable incidents. Journal of Marketing, 54(1), 71–84.
Blodgett, J. G., Granbois, D. H., & Walters, R. G. (1993). The effects of perceived justice on complainants’ negative word-of-mouth behavior and repatronage intentions. Journal of Retailing, 69(4), 399–428.
Blodgett, J. G., Hill, D., & Tax, S. S. (1997). The effects of distributive, procedural, and interactional justice on postcomplaint behavior. Journal of Retailing, 73, 185–210.
Bolton, R. N. (1998). A dynamic model of the duration of the customer’s relationship with a continuous service provider: the role of satisfaction. Marketing Science, 17(1), 45–66.
Brown, S. W. (2000). Practicing Best-in-class service recovery. Marketing Management, 9(2), 8–9.
Brown, S. P., & Beltramini, R. F. (1989). Consumer complaining and word of mouth activities: field evidence. Advances in Consumer Research, 16(1), 9–16.
Bryk, A. S., & Raudenbush, S. W. (2002). Hierarchical linear models: Applications and data analysis methods (2nd ed.). Newbury Park: Sage.
Bush, R. F., & Busch, P. (1981). The relationship of tenure and age to role clarity and its consequences in the industrial salesforce. Journal of Personal Selling & Sales Management, 2(1), 17–23.
Chebat, J.-C., & Kollias, P. (2000). The impact of empowerment on customer contact employees’ roles in service organizations. Journal of Service Research, 3(1), 66–81.
Chebat, J.-C., Davidow, M., & Codjovi, I. (2005). Silent voices. Why some dissatisfied consumers fail to complain. Journal of Service Research, 7(4), 328–342.
Clemmer, E. C. (1993). An investigation into the relationship of fairness and customer satisfaction with services. In R. Cropanzano (Ed.), Justice in the workplace: Approaching fairness in human resource management (pp. 193–207). Hillsdale: Erlbaum.
Cohen, J., Cohen, P., West, S. G., & Aiken, L. S. (2003). Applied multiple regression/correlation analysis for the behavioral sciences (3rd ed.). Mahwah: Erlbaum.
Conlon, D. E., & Murray, N. M. (1996). Customer perceptions of corporate responses to product complaints: the role of explanations. Academy of Management Journal, 39(4), 1040–1056.
Cummings, W. T., Jackson, D. W., & Olstrom, L. L. (1989). Examining product managers’ job satisfaction and performance using selected organizational behavior variables. Journal of the Academy of Marketing Science, 17(2), 147–156.
Dagger, T. S., Danaher, P. J., & Gibbs, B. J. (2009). How often versus how long: the interplay of contact frequency and relationship duration in customer-reported service relationship strength. Journal of Service Research, 11(4), 371–388.
Davidow, M. (2003). Organizational responses to customer complaints: what works and what doesn’t. Journal of Service Research, 5(3), 225–250.
Diehl, K., Kornish, L. J., & Lynch, J. G. (2003). Smart agents: when lower search costs for quality information increase price sensitivity. Journal of Consumer Research, 30, 56–71.
Folger, R., & Greenberg, J. (1985). Procedural justice: an interpretive analysis of personnel systems. Research in Personnel and Human Resources Management, 3, 141–183.
Folkes, V. S. (1984). Consumer reactions to product failure: an attributional approach. Journal of Consumer Research, 10, 398–409.
Fornell, C., & Bookstein, F. L. (1982). A comparative analysis of two structural equation models. In C. Fornell (Ed.), A second generation of multivariate analysis (pp. 289–324). New York: Praeger.
Fornell, C., & Larcker, D. F. (1981). Evaluating structural equation models with unobservable variables and measurement error. Journal of Marketing Research, 18, 39–50.
Fornell, C., & Wernerfelt, B. (1987). Defensive marketing strategy by customer complaint management: a theoretical analysis. Journal of Marketing Research, 24, 337–346.
Fornell, C., Mithas, S., Morgeson, F. V., III, & Krishnan, M. S. (2006). Customer satisfaction and stock prices: high returns, low risk. Journal of Marketing, 70(1), 3–14.
Friedman, M. L., & Churchill, G. A., Jr. (1987). Using consumer perceptions and a contingency approach to improve health care delivery. Journal of Consumer Research, 13(4), 492–510.
Ganesan, S. (1994). Determinants of long-term orientation in buyer–seller relationships. Journal of Marketing, 58(2), 1–19.
Gilbert, F. W., & Warren, W. E. (1995). Psychographic constructs and demographic segments. Psychology & Marketing, 12(3), 223–237.
Gilliland, S. W. (1993). The perceived fairness of selection systems: an organizational justice perspective. Academy of Management Review, 18(4), 694–734.
Gilly, M. C., & Gelb, B. D. (1982). Post-purchase consumer processes and the complaining consumer. Journal of Consumer Research, 9(3), 323–328.
Goodwin, C., & Ross, I. (1989). Salient dimensions of perceived fairness in resolution of service complaints. Journal of Consumer Satisfaction, Dissatisfaction, and Complaining Behavior, 2, 87–92.
Goodwin, C., & Ross, I. (1992). Consumer responses to service failures: influence of procedural and interactional fairness perceptions. Journal of Business Research, 25(2), 149–163.
Grainer, M. (2003). Customer care: The multibillion dollar sinkhole. Alexandria: Customer Care Alliance.
Greenberg, J., & McCarty, C. (1990). The interpersonal aspects of procedural justice: a new perspective in pay fairness. Labor Law Journal, 41, 580–585.
Handy, C. (1994). Understanding organizations (4th ed.). London: Penguin.
Hart, C. W. L., Heskett, J. L., & Sasser, W. E. (1990). The profitable art of service recovery. Harvard Business Review, 68(4), 148–156.
Hartline, M. D., & Ferrell, O. C. (1996). The management of customer-contact service employees: an empirical investigation. Journal of Marketing, 60(4), 52–70.
Hess, R. L., Ganesan, S., & Klein, N. (2003). Service failure and recovery: the impact of relationship factors on customer satisfaction. Journal of Academy of Marketing Science, 31(2), 127–145.
Homans, G. C. (1961). Social behavior: Its elementary forms. New York: Harcourt, Brace & World.
Homburg, C., & Fürst, A. (2005). How organizational complaint handling drives customer loyalty: an analysis of the mechanistic and the organic approach. Journal of Marketing, 69(3), 95–114.
Homburg, C., & Fürst, A. (2007). See no evil, hear no evil, speak no evil: a study of defensive organizational behavior towards customer complaints. Journal of the Academy of Marketing Science, 35(4), 523–536.
Hunt, J. M., & Kernan, J. B. (1991). Consumer reaction to inequitable exchange: the role of causal inferences. The Journal of Social Psychology, 131(5), 685–696.
Jarvis, C. B., MacKenzie, S. B., & Podsakoff, P. M. (2003). A critical review of construct indicators and measurement model misspecification in marketing and consumer research. Journal of Consumer Research, 30, 199–218.
Jasso, G. (1980). A new theory of distributive justice. American Sociological Review, 45, 3–32.
Johnston, R. (2001). Linking complaint management to profit. International Journal of Service Industry Management, 12(1), 60–69.
Krishnan, S., & Valle, V. A. (1979). Dissatisfaction attributions and consumer complaint behavior. In W. Wilkie (Ed.), Advances in consumer research (4th ed., pp. 445–449). Ann Arbor: Association for Consumer Research.
Kumar, N., Scheer, L. K., & Steenkamp, J.-B. E. M. (1995). The effects of supplier fairness on vulnerable resellers. Journal of Marketing Research, 32(1), 54–65.
Licata, J. W., Mowen, J. C., Harris, E. G., & Brown, T. J. (2003). On the trait antecedents and outcomes of service worker job resourcefulness. Journal of the Academy of Marketing Science, 31(3), 256–271.
Lichtenstein, D. R., Ridgway, N. M., & Netemeyer, R. G. (1993). Price perceptions and consumer shopping behavior: a field study. Journal of Marketing Research, 30(2), 234–245.
Lind, E. A., & Tyler, T. R. (1988). The social psychology of procedural justice. New York: Plenum.
March, J. G., & Simon, H. A. (1993). Organizations (2nd ed.). Cambridge: Blackwell.
Mattila, A. S. (2001). The effectiveness of service recovery in a multi-industry setting. Journal of Services Marketing, 15(7), 583–596.
Maxham, J. G., III, & Netemeyer, R. G. (2003). Firms reap what they sow: the effects of shared values and perceived organizational justice on customers’ evaluations of complaint handling. Journal of Marketing, 67(1), 46–62.
Maxwell, S. (1999). The social norms of discrete consumer exchange: classification and quantification. American Journal of Economics & Sociology, 58(4), 999–1018.
McColl-Kennedy, J. R., Daus, C. S., & Sparks, B. A. (2003). The role of gender in reactions to service failure and recovery. Journal of Service Research, 6(1), 66–82.
McCollough, M. A., Berry, L. L., & Yadav, M. S. (2000). An empirical investigation of customer satisfaction after service failure and recovery. Journal of Service Research, 3, 121–137.
Narayandas, D., & Kasturi, R. V. (2004). Building and sustaining buyer–seller relationships in mature industrial markets. Journal of Marketing, 68(3), 63–77.
Neter, J., Kutner, M. H., Nachtsheim, C. J., & Wasserman, W. (1996). Applied linear statistical models (4th ed.). Chicago: Irwin.
Nunnally, J. C. (1978). Psychometric theory (2nd ed.). New York: McGraw-Hill.
Oliver, R. (1997). Equity: How consumers interpret fairness. In R. Oliver (Ed.), Satisfaction: A behavioral perspective on the consumer (pp. 193–215). Boston: McGraw-Hill.
Olsen, L. L., & Johnson, M. D. (2003). Service equity, satisfaction, and loyalty: from transaction-specific to cumulative evaluations. Journal of Service Research, 5(3), 184–197.
Palmatier, R. W., Scheer, L. K., & Steenkamp, J.-B. (2007). Customer loyalty to whom? Managing the benefits and risks of salesperson-owned loyalty. Journal of Marketing Research, 44(2), 185–199.
Palmer, A., Beggs, R., & Keown-McMullan, C. (2000). Equity and repurchase intention following service failure. Journal of Services Marketing, 14(6), 513–528.
Petty, R. E., & Cacioppo, J. T. (1986). Communication and persuasion: Central and peripheral routes to attitude change. New York: Springer.
Petty, R. E., Harkins, S. G., & Williams, K. D. (1980). The effects of group diffusion of cognitive effort on attitudes: an information processing view. Journal of Personality and Social Psychology, 38(1), 81–92.
Phillips, L. W., & Sternthal, B. (1977). Age differences in information processing: a perspective on the aged consumer. Journal of Marketing Research, 14(4), 444–457.
Raimondo, M. A., Miceli, G., & Costabile, M. (2008). How relationship age moderates loyalty formation: the increasing effect of relational equity on customer loyalty. Journal of Service Research, 11(2), 142–160.
Rao, A. R., & Bergen, M. E. (1992). Price premium variations as a consequence of buyers’ lack of information. Journal of Consumer Research, 19(3), 412–423.
Reinartz, W. J., & Kumar, V. (2003). The impact of customer relationship characteristics on profitable lifetime duration. Journal of Marketing, 67, 77–99.
Richins, M. L. (1983). Negative word-of-mouth by dissatisfied consumers: a pilot study. Journal of Marketing, 47(1), 68–78.
Roberts, J. K. (2004). An introductory primer on multilevel and hierarchical linear modelling. Learning Disabilities: A Contemporary Journal, 2(1), 30–38.
Roberts, J. K., & Monaco, J. P. (2006). Effect size measures for the two-level linear multilevel model. San Francisco: American Educational Research Association.
Shuptrine, K. F., & Wenglorz, G. (1981). Comprehensive identification of consumers’ marketplace problems and what they do about them. In K. B. Monroe (Ed.), Advances in consumer research (8th ed., pp. 687–692). Ann Arbor: Association for Consumer Research.
Simon, H. A. (1997). Administrative behavior (4th ed.). New York: Free.
Singh, J. (1990). A typology of consumer dissatisfaction response styles. Journal of Retailing, 66(1), 57–99.
Slama, M. E., & Tashchian, A. (1985). Selected socioeconomic and demographic characteristics associated with purchasing involvement. Journal of Marketing, 49(1), 72–82.
Smith, A. K., Bolton, R. N., & Wagner, J. (1999). A model of customer satisfaction with service encounters involving failure and recovery. Journal of Marketing Research, 34, 356–372.
Snijders, T. A. B., & Bosker, R. J. (1994). Modeled variance in two-level models. Sociological Methods and Research, 22, 342–363.
Sweeney, P. D., & McFarlin, D. B. (1997). Process and outcome: gender differences in the assessment of justice. Journal of Organizational Behavior, 18(1), 83–98.
TARP (Technical Assistance Research Program). (1986). Consumer complaint handling in America: An update study (Part II). Washington: Technical Assistance Research Program Institute and United States Office of Consumer Affairs.
Tax, S. S., & Brown, S. W. (1998). Recovering and learning from service failure. Sloan Management Review, 40(1), 75–88.
Tax, S. S., Brown, S. W., & Chandrashekaran, M. (1998). Customer evaluations of service complaint experiences: implications for relationship marketing. Journal of Marketing, 62, 60–76.
Tsiros, M., Mittal, V., & Ross, W. (2004). The role of attributions in customer satisfaction: a reexamination. Journal of Consumer Research, 31(2), 476–483.
Walster, E., Berscheid, E., & Walster, G. W. (1973). New directions in equity research. Journal of Personality and Social Psychology, 25(2), 151–176.
Ward, T., & Dagger, T. S. (2007). The complexity of relationship marketing for service customers. Journal of Services Marketing, 21(4), 281–290.
Webster, F. E. (1978). Management science in industrial marketing. Journal of Marketing, 42(1), 21–27.
Weitz, B. A. (1981). Effectiveness in sales interactions: a contingency framework. Journal of Marketing, 45(1), 85–103.
Zajonc, R. B. (1984). On the primacy of affect. American Psychologist, 39, 117–123.
Zeithaml, V. (1985). The new demographics and market fragmentation. Journal of Marketing, 49(3), 64–75.
Zeithaml, V. A., Varadarajan, P. R., & Zeithaml, C. P. (1988). The contingency approach: its foundations and relevance to theory building and research in marketing. European Journal of Marketing, 22(7), 37–64.
About this article
Cite this article
Homburg, C., Fürst, A. & Koschate, N. On the importance of complaint handling design: a multi-level analysis of the impact in specific complaint situations. J. of the Acad. Mark. Sci. 38, 265–287 (2010). https://doi.org/10.1007/s11747-009-0172-y