The influence of guarantee compensation and fix on service recovery

This study employed a 3 x 2 full-factorial, between-subjects design experiment examining the influence of service guarantee compensation and fix on hotel guests’ satisfaction following invocation of a service guarantee. The study involved a sample of 390 online panel members. As expected, satisfaction is enhanced when the problem is corrected, however overcompensating guests beyond what was initially promised does not enhance satisfaction evaluations. Increasing compensation from the low to the medium (promised) level results in stronger satisfaction ratings when the problem is fixed versus when it is not.