Recovering Together: A Moderated Mediated Analysis of Co-Created Recovery on Repatronage Intentions

Abstract

Service failures can significantly impact hotel customers’ loyalty, often leading to negative re-patronage intentions. However, how service recovery efforts are designed and implemented is crucial in mitigating these adverse effects. Co-created service recovery, where customers actively participate in solving service failures, has emerged as a critical strategy to improve customers’ subsequent behaviours. Drawing on the value co-creation theory, this study investigates the moderating effect of co-created service recovery on customers’ responses to service failures and their subsequent re-patronage intentions. A two-phase quasi-experimental study was conducted to determine the effectiveness of co-created service recovery relative to customers’ aversion, distrust, and negative re-patronage intentions. Quantitative data was obtained from 153 purposively sampled participants. Data was analysed using a t-test and moderated mediation analysis using Model 14 in PROCESS macro. The findings suggest that when customers perceive their input as valued during recovery efforts, they are less likely to be aversive and distrustful towards the hotel. In turn, their negative re-patronage intentions are reduced. These findings provide important insights for hotel managers on enhancing co-creation as a service recovery strategy to improve customer loyalty and retention.