Tourism Management 30 (2009) 51–62

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Tourism Management
journal homepage: www.elsevier.com/locate/tourman

The effects of perceived justice on recovery satisfaction, trust,

word-of-mouth, and revisit intention in upscale hotels
Taegoo (Terry) Kim a,1, Woo Gon Kim b, *, Hong-Bumm Kim c, 2
a
BK21 Institute for HRD in Tourism Research for Jeju International Free City, Cheju National University, 66 Jejudaehakno, Jeju Special Self-Governing Province,
Jeju City 690-756, Republic of Korea
b
International Center for Hospitality Research, Dedman School of Hospitality, College of Business, Florida State University, 1 Champions Way, UCB 4100,
P.O. Box 3062541, Tallahassee, FL 32306-2541, USA
c
College of Hospitality and Tourism, Sejong University, Kwang-jin Gu, Gun-ja Dong 98, Seou 143-747, Republic of Korea

a r t i c l e i n f o a b s t r a c t

Article history: The purpose of this study is to assess the relative influences of distributive (DJ), procedural (PJ), and
Received 13 October 2007 interactional (IJ) justices on customer satisfaction with service recovery and to examine the relationship
Accepted 8 April 2008 between recovery satisfaction and subsequent customer relationships: trust, word-of-mouth (WOM),
and revisit intention. On-site surveys were administered to collect data from hotel guests who stayed,
Keywords: and experienced a service failure, at five-star hotels. The effect of DJ on satisfaction with service recovery
Service failure was stronger than those of PJ and IJ. Since DJ, PJ, and IJ have significant effects on trust, WOM, and revisit
Service recovery
intention through recovery satisfaction, recovery satisfaction was found to be an important mediating
Complaint handling
Perceived justice
variable. In addition, the mediational role of trust between recovery satisfaction and WOM/revisit
Trust intention is substantial. Thus, in a case where strong trust is formed between the service provider and
Nested model the customer, a long-term relationship can be expected.
Model comparison Ó 2008 Elsevier Ltd. All rights reserved.
Model parsimony

1. Introduction Grönroos (1990, p. 5) defined service recovery processes as ‘‘those

No matter how excellent the service a hotel delivers, every hotel
still often makes mistakes in meeting the expectations of today’s
hotel guests, who tend to be more demanding and less loyal than
ever before. Service failures are inevitable due to the high ‘‘people
factor’’ of services in the hospitality business (Susskind, 2002).
Service failure can prompt customer dissatisfaction with the service
provider, which could possibly lead to customer complaints. Hotel
guests who are dissatisfied with the service encounter could pos-
sibly show any number of the following four reactions: exit silently,
spread a negative word-of-mouth (WOM), voice their complaints to
the operator, or continue to patronage the same property despite
their dissatisfaction (Karande, Magnini, & Tam, 2007; Susskind,
2002; Tax, Brown, & Chandrashekaran, 1998).
* Corresponding author. Tel.: þ1850 644 8242; fax: þ1850 644 5565.
E-mail addresses: tgkim62@cheju.ac.kr (T. (Terry) Kim), wkim@cob.fsu.edu
(W.G. Kim), kimhb@sejong.ac.kr (H.-B. Kim).
1
Tel.: þ8264 754 3199; fax: þ8264 754 3198.
2
Tel.: þ822 3408 3172; fax: þ822 3408 3312.
actions in which a firm engages to address a customer complaint
regarding a perceived service failure.’’ Some researchers suggest
that a company’s service recovery effort can restore customer sat-
isfaction (Smith & Bolton, 1998; Smith, Bolton, & Wagner, 1999),
reinforce customer relationships, and eventually attain customer
patronage (Blodgett, Granbois, & Walters, 1993; Blodgett, Hill, &
Tax, 1997; Chebat & Slusarczyk, 2005; Smith & Bolton, 1998; Wirtz
& Mattila, 2004). Superb post-failure recovery efforts can induce
‘‘service recovery paradox,’’ a term coined by McCollough and
Bharadwaj (1992), whereby customers experiencing a service fail-
ure perceive a higher level of post-recovery satisfaction than those
who did not experience a service failure encounter at all.
Past research reveals that effective complaint handling is posi-
tively related to customer loyalty and the subsequent customer
retention, which eventually leads to long-term profitability (Brown,
Cowles, & Tuten, 1996; Reichheld & Sasser, 1990; Tax et al., 1998).
Since hotel companies cannot prevent all customer complaints,
they have recently devoted a great deal of money and effort to learn
how to better manage and respond to customer complaints about
service failures. Hotel companies have implemented service re-
covery programs that empower employees to immediately solve

0261-5177/$ – see front matter Ó 2008 Elsevier Ltd. All rights reserved.
doi:10.1016/j.tourman.2008.04.003
52 T. (Terry) Kim et al. / Tourism Management 30 (2009) 51–62
problems by offering dissatisfied customers appropriate compen-
sation (Stoller, 2005). For instance, the Hampton Inn has imple-
mented a service guarantee program which resulted in one of the
highest customer retention rates in the hotel industry and, sub-
sequently, a high economic return (Ettorre, 1994). Each year
Hampton Inn spends approximately 0.5% of its total room revenue
on dissatisfied guests. For every $1 invested, the Hampton Inn re-
alizes $7 in additional revenue from a new customer or a disgrun-
tled one who would not have returned without the atonement
(Stoller, 2005). Ritz-Carlton is considered a leader in thoroughly
managing guest complaints by empowering all its employees to
resolve all customer disputes up to $2000 per day (Stoller, 2005).
A justice theory framework appears to gain popularity in
explaining how guests evaluate service providers’ reactions to
service failure/recovery. Perceived justice is a multi-dimensional
concept comprising three dimensions: distributive (DJ), procedural
(PJ), and interactional justice (IJ). The application of the justice
framework facilitates a deepening theoretical understanding of the
service provider and the customer relationship dynamics (Collie,
Sparks, & Bradley, 2000). Notwithstanding the recent advances
concerning the effects of perceived justice on post-recovery be-
havior, there is still room to learn how a service provider’s recovery
efforts affect subsequent customer relationships with the company.
Although some studies have been performed on service recovery in
the service industry field, such as the hospitality industry (e.g.,
DeWitt, Nguyen, & Marshall, 2008; Karande et al., 2007; Karatepe,
2006; Mattila & Patterson, 2004; Ok, Back, & Shanklin, 2005; Smith
et al., 1999; Sparks & Fredline, 2007; Wirtz & Mattila, 2004; Yuksel,
Kilinc, & Yuksel, 2006), only a few studies have attempted to adopt
the relationship marketing approach to explain the relationship
between perceived justice with service recovery, recovery satis-
faction, and three relationship outcome variables: trust, WOM, and
revisit intention. Considering the importance of the outcomes of
the relationship management after service recovery efforts, this
study attempts to fill the gap by linking the perceived justice of the
recovery efforts following service failure with important customer
relationships.
The purpose of this study, then, is to assess the relative effects of
DJ, PJ, and IJ on recovery satisfaction and to examine the relation-
ships between recovery satisfaction and customer relationship
variables: trust, WOM, and revisit intention. Satisfaction with
recovery serves as the mediator between the three dimensions of
perceived justice and post-recovery relationship variables.
2. Literature review and hypotheses
2.1. Perceived justice with service recovery
The justice theory of Adams (1963) has been adopted as
a powerful vehicle in predicting customer satisfaction or dissatis-
faction after they have experienced service failure. Table 1 sum-
marizes the existing empirical literature that examines the effect of
perceived justice on recovery satisfaction and relationship outcome
variables in hospitality as well as in a variety of other industries.
Generally, the perceived justice dimensions with service recovery
include DJ, PJ, and IJ (Blodgett et al., 1997; Chebat & Slusarczyk,
2005; Clemmer & Schneider, 1996; Karatepe, 2006; Ok et al., 2005;
Smith et al., 1999; Tax et al., 1998).
2.1.1. Distributive justice (DJ)
Smith et al. (1999, pp. 358–359) defined DJ as ‘‘the allocation of
costs and benefits in achieving equitable exchange relationships.’’
DJ has generally dealt with the outcomes given to the customers
during service recovery, which include such monetary rewards as
refunds for failed service, discounts, coupons, and free-of-charge
(Mattila, 2001; Sparks & McColl-Kennedy, 2001), and adjustment
and substitution (Lewis & McCann, 2004). DJ in service recovery has
been measured by the ‘‘justice,’’ ‘‘fairness,’’ ‘‘need,’’ ‘‘value,’’ and
‘‘reward’’ of outcomes (Blodgett et al., 1997; Chebat & Slusarczyk,
2005; Smith et al., 1999; Wirtz & Mattila, 2004).
2.1.2. Procedural justice (PJ)
PJ refers to ‘‘the perceived fairness of policies, procedures, and
criteria used by decision makers to arrive at the outcome of a dis-
pute or negotiation’’ (Blodgett et al., 1997, p. 189). That is, the per-
ceived PJ for service recovery means the customer’s perception of
justice for the several stages of procedures and processes needed to
recover the failed service (Mattila, 2001). PJ is the customer per-
ception of the company’s systematic and appropriate process in
solving the service problems or managing the customer com-
plaints, and it includes the company’s policies and disciplines
(Smith et al., 1999), including ‘‘timeliness,’’ ‘‘promptness,’’ ‘‘ap-
proach,’’ ‘‘flexibility,’’ ‘‘procedure control,’’ ‘‘outcome control,’’
‘‘right policy and execution,’’ and ‘‘appropriate method’’ for the
specific contents of PJ in service recovery (Blodgett et al., 1997;
Chebat & Slusarczyk, 2005; Maxham III & Netemeyer, 2002; Smith
et al., 1999; Wirtz & Mattila, 2004).
2.1.3. Interactional justice (IJ)
IJ in service recovery is related to the way customers involved in
a failed service are handled, and it means the evaluation of the de-
gree to which the customers have experienced justice in human
interactions from the employees of service firms during the recovery
process (Sparks & McColl-Kennedy, 2001). Tax et al. (1998, p. 62)
conceptualized IJ as ‘‘the perceived fairness of interpersonal treat-
ment that people receive during the enactment of procedures.’’ The
specific methods suggested for IJ in service recovery are ‘‘courtesy,’’
‘‘respect,’’ ‘‘interest,’’ ‘‘careful listening,’’ ‘‘effort,’’ ‘‘trust,’’ ‘‘explana-
tion,’’ ‘‘empathy,’’ ‘‘apology,’ and ‘‘communication’’ (Blodgett et al.,
1997; Mattila, 2001; Smith et al., 1999; Wirtz & Mattila, 2004).
2.2. Perceived justice and satisfaction with the recovery
Extant research indicated that perceived justice of the recovery
efforts could affect satisfaction with the recovery (Blodgett et al.,
1997; Chebat & Slusarczyk, 2005; Mattila & Patterson, 2004;
Karatepe, 2006). As reported in Table 1, many of them insisted that
the degree of the influence would vary according to the types of
justice itself. For instance, Smith et al. (1999) concluded that DJ has
a stronger impact on satisfaction than the other two types of jus-
tice. On the other hand, Blodgett et al. (1997) stated that IJ was the
most important determinant of satisfaction followed by DJ. Con-
sistent with the findings of Blodgett et al. (1997), Karatepe (2006)
disclosed that IJ has a greater influence on hotel guests’ satisfaction
with complaint handling than do DJ and PJ. Ok et al. (2005), on the
other hand, showed that PJ had the largest influence on recovery
satisfaction in a restaurant followed by DJ and then IJ. Thus, the
above discussion on perceived justice with service recovery leads to
the following hypotheses:
Hypothesis 1a. DJ has a positive effect on satisfaction with the
recovery.
Hypothesis 1b. PJ has a positive effect on satisfaction with the
recovery.
Hypothesis 1c. IJ has a positive effect on satisfaction with the
recovery.
2.3. Recovery satisfaction and trust
Many researchers have studied customer satisfaction with
service recovery (e.g., Blodgett, Wakefield, & Barnes, 1995; Brown
 T. (Terry) Kim et al. / Tourism Management 30 (2009) 51–62
et al., 1996; Goodwin & Ross, 1992; Maxham III, 2001; McCollough,
Berry, & Yadav, 2000; Ok et al., 2005; Smith & Bolton, 1998; Smith
et al., 1999; Tax et al., 1998). In this research, customer satisfaction
with service recovery means a positive status of emotion perceived
by customers in the process and result of recovering the failed
service. Davidow (2000, p. 478) defines satisfaction with complaint
handling as ‘‘the customer’s overall affective feeling about the firm
as a result of the firm’s complaint handling.’’
Trust builds when the customer has confidence in a service
provider’s reliability and integrity (Morgan & Hunt, 1994; Wong &
Sohal, 2002). Trust is a requisite in service marketing for main-
taining the relationship between customers and service providers,
because customers often have to make a purchase decision before
they actually experience the service (Berry & Parasuraman, 1991).
As satisfaction arises from meeting or exceeding the expectations of
the customer, satisfaction over time strengthens the reliability of
the service provider and cultivates trust (Ganesan, 1994; Tax et al.,
1998). Previous research confirms that satisfaction with service
recovery serves as a predictor of trust (Ok et al., 2005; de Ruyter &
Wetzels, 2000; Tax et al., 1998). Thus, the following hypothesis is
proposed:
Hypothesis 2. Recovery satisfaction has a positive effect on trust.
2.4. Recovery satisfaction, word-of-mouth, and revisit intention
Previous empirical research suggests that recovery satisfaction
is strongly associated with customer loyalty (de Ruyter & Wetzels,
2000; Karatepe, 2006). Extant research also reveals that effective
complaint handling is positively related to subsequent customer
retention (Reichheld & Sasser, 1990; Smith & Bolton, 1998; Tax
et al., 1998). Maxham III and Netemeyer (2002) showed that re-
covery satisfaction has a significantly positive effect on spreading
positive WOM. Furthermore, Tax et al. (1998) claimed that
recovery satisfaction has a positive effect on a customer’s revisit
intention.
If recovery from service failure is effective, the customer
satisfaction increases and revisit intention will rise. However, if
recovery from service failure is not executed fairly, recovery
satisfaction will decrease, and ultimately WOM referral and
revisit intention will also decrease. Thus, the following hypoth-
eses are proposed:
Hypothesis 3. Recovery satisfaction has a positive effect on WOM.
Hypothesis 4. Recovery satisfaction has a positive effect on revisit
intention.
2.5. Trust, word-of-mouth, and revisit intention
Morgan and Hunt (1994) developed a model of relationship
marketing that conceptualized trust as the key mediating variable to
the development of long-term customer relationships. Gwinner,
Gremler, and Bitner (1998) indicated that the psychological benefit
of belief and trust is more important than special treatment or social
benefit in the relationship between service firms and customers.
Therefore, customers developing trust with service providers have
proper reasons to maintain the relationship with them. Because of
these inherent characteristics, a service firm (such as a hotel) is able
to employ trust as the most powerful marketing tool to build cus-
tomer loyalty. In particular, when service providers recover in a way
that builds customer trust, the perceived risk in complaining to the
providers in the future is likely to be reduced (DeWitt et al., 2008).
Garbarino and Johnson (1999) suggest that trust and commit-
ment both affect the future purchase intentions of an exchange
partner. Selnes (1998) confirmed that trust has a positive influence
53
on motivation to improve a mutually beneficial buyer–seller
relationship. Oh (2002) demonstrated that trust in restaurant
customers has a significantly positive effect on relationship in-
tention and repurchase intention. In light of the aforementioned
evidence, the following hypotheses are proposed:
Hypothesis 5. Trust has a positive effect on WOM.
Hypothesis 6. Trust has a positive effect on revisit intention.
3. Method
3.1. Measures
Multiple item scales were used to measure each construct in this
study. If possible, validated scales from previous literature were
employed after a slight modification. In this study, the items in all
scales, except for WOM, revisit intention, and one item for DJ, were
measured on a seven-point Likert-type scale ranging from ‘‘strongly
disagree’’ (1) to ‘‘strongly agree’’ (7). WOM and revisit intention were
measured on a seven-point Likert-type scale anchored with ‘‘least
likely’’ (1) and ‘‘extremely likely’’ (7). One item to measure DJ,
‘‘compared to what you expected, the offer received (e.g., discount)
was,’’ was anchored with ‘‘less than expected’’ (1) and ‘‘more than
expected’’ (7). A total of 25 items were used to capture the seven
latent constructs: three exogenous (perceived justice dimensions)
and four endogenous constructs (recovery satisfaction and
relationship outcome variables: trust, WOM, and revisit intention).
As shown in Table 2, the DJ was measured by a four-item scale
adopted from Blodgett et al. (1997) and Smith et al. (1999). The PJ
was measured by a four-item scale adapted from Blodgett et al.
(1997) and Karatepe (2006). To measure the IJ construct, we used
a five-item scale adapted from Karatepe (2006), Smith et al. (1999),
and Tax et al. (1998). The recovery satisfaction scale was measured
by a four-item scale adapted from Brown et al. (1996), as well as
from Maxham III and Netemeyer (2002). The four-item scale for
trust was adapted from Morgan and Hunt (1994) and Wong and
Sohal (2002). The WOM scale was measured by a two-item scale
adapted from Mattila (2001) and Wong and Sohal (2002). Finally,
the two-item scale, revisit intention, was adapted from Mattila
(2001) and Maxham III and Netemeyer (2002).
3.2. Sampling frame and data collection
Data were collected from hotel guests in Seoul, Korea. We chose
five-star hotels as our sample, because successful service recovery
from failure is a high priority for luxury hotel managers to maintain
long-term guest relationships. Researchers contacted the directors
of marketing for all 11 luxury hotels, but only 4 of the hotels
allowed a research team to survey their guests. The four hotels are
affiliated with an international chain brand and primarily cater to
business travelers. A screening question was asked to see if re-
spondents encountered any service failure at a five-star hotel dur-
ing the past six months. The on-site self-administered survey was
distributed to only those qualified Korean hotel guests. The ques-
tionnaire was adapted from original English questionnaire items
and then translated into Korean. Two research faculties, who were
educated in the U.S., and a native Korean were involved in the
translation process. A group of six hotel managers and four research
faculties participated in a pilot test to refine the instrument by
clarifying any ambiguous expressions, awkward wordings, or dis-
tortions of the original meanings. The survey provides respondents
a monetary incentive for completing and returning the question-
naire, and out of 1000 surveys, the response rate was 47.8%, rep-
resenting a total of 478 returned questionnaires. Out of the 478
collected, 27 questionnaires were either incomplete or the answers
54 T. (Terry) Kim et al. / Tourism Management 30 (2009) 51–62
Table 1
Previous studies on the perceived justice, recovery satisfaction, and related-relationship outcome variables
Author/s Sample
DeWitt et al. (2008) Restaurants and hotel
customers
Karande et al. (2007) Online consumer panel
(of a large reputed
marketing research
company) as hotel
and customers
Sparks and Fredline (2007) Community members
who had previously
experienced staying
in luxury hotels
Karatepe (2006) Hotel customers
Yuksel et al. (2006) Hotel customers
Ok et al. (2005) Members of community
service and religious
group as casual
restaurant customers
Chebat and Slusarczyk (2005) Bank customers
Mattila and Patterson (2004) Undergraduate students
(American, Thai, and
Malay) as casual dining
restaurant customers
Maxham III (2001) Barber shop customers
McCollough et al. (2000) Airline passengers
Smith et al. (1999) Undergraduate students
and hotel customers
Tax et al. (1998) Employees as customers
Research design Notable findings
Between-subjects Perceived justice following a service recovery had a
experiment with positive effect on customer trust. In addition, trust
hypothetical scenarios following service recovery had a positive effect on
involving service customer loyalty (customer loyalty was employed
failures two perspectives: attitudinal and behavioral loyalty.
Justice perception construct was used as single global
construct instead of three individual dimensions
of justice).
Between-subjects Simple-effect tests showed that procedural justice had
experiment with a significant positive effect on overall post-failure
hypothetical scenarios satisfaction for the airline and hotel scenairos and
involving service combined sample. Customers had higher overall
failures post-failure satisfaction when they had higher
procedural justice perceptions (for the airline, hotel,
and combined samples) than lower procedural justice
perceptions (for the airline, hotel, and combined
samples) across all samples.
Between-subjects A referential explanation of a service failure had a
experiment with different impact on customer evaluations of customer
hypothetical satisfaction and intended loyalty than a justification.
scenarios involving More thorough accounts of a service failure resulted in
service failures higher levels of customer satisfaction and intended
loyalty. Account adequacy for a service failure is greater
in contexts of low versus high outcome severity. Under
the high severity condition an explanation of a service
failure reduced the level of counterfactual thinking.
Retrospective Distributive, procedural, and interactional justice affect
self-report survey complaint satisfaction and complaint loyalty, where
of past dissatisfactory interactional justice has a stronger impact on complaint
experiences satisfaction and complaint loyalty than other types of justice.
Between-subjects There are more differences than similarities in complaining
experiment with behaviors of British, Israeli, Dutch and Turkish hotel customers.
hypothetical scenarios These countries had a favorable attitude toward complaining.
involving service A moderate relationship between attitudes and choice of
failures complaining behaviors was found. Hotel customers with
favorable attitudes to complaining were more likely to engage
in voice behavior, whereas hotel customers with negative
attitudes were more likely to display switch or loyalty behavior.
Mixed-design Distributive, procedural, and interactional justice affect service
experiment with recovery satisfaction, which in turn affects trust and overall
hypothetical scenarios satisfaction. Here, procedural justice has a stronger impact
on service recovery satisfaction than other types of justice.
Telephone interview Interactional justice (e.g., courtesy) demonstrated direct effect
survey of past on loyalty-exit behavior. Distributive and procedural justice
dissatisfactory (i.e., timeliness) have only indirect effect on loyalty through
experiences the mediating effects of negative and positive emotions.
Quasi-experimental Compensation seemed to drive customers’
and between-subjects fairness perceptions, in particular with American consumers.
with hypothetical Offerings an explanation
scenarios for the failure had a positive impact on customer perceptions
regardless of the customers’ cultural orientation. Perceived
fairness was directly linked to post-recovery satisfaction.
Mixed-design Moderate to high service recovery efforts notably enhanced
experiment with post-failure satisfaction, purchase intent, and positive WOM.
hypothetical On the other hand, poor service recoveries appeared
scenarios to aggravate the dissatisfaction resulted from a service failure.
Between-subjects Distributive and interactional justice affected satisfaction with
experiment with a particular experience.
hypothetical scenarios
involving service failures
Mixed-design Distributive, procedural, and interactional justice affected service
experiment with encounter satisfaction. In particular, the impact of distributive
hypothetical justice on recovery satisfaction appeared to be stronger than
scenarios that of procedural and interactional justice.
Cross-sectional Interactional, distributive, and procedural justice affected
survey capturing satisfaction with complaint handling. In particular, interactional
retrospective justice has a stronger impact on satisfaction with complaint
evaluations of handling than other types of justice.
past complaints
 T. (Terry) Kim et al. / Tourism Management 30 (2009) 51–62 55

Table 1 (continued)

Author/s Sample Research design Notable findings

Smith and Bolton (1998) Undergraduate students Between-subjects Cumulative satisfaction and repatronage intent increased as
and hotel customers experiment with transactional satisfaction increases.
hypothetical scenarios

Blodgett et al. (1997) Consumers recruited Quasi-experiment Interactional justice can compensate for lower levels of
from church groups with hypothetical distributive justice. In addition, interactional justice was
scenarios the most important determinant of satisfaction followed
by distributed justice.

Clemmer and Schneider (1996) Fast food restaurant, Retrospective Distributive justice was the most important determinant
bank, and hospital self-report survey of customer satisfaction, followed by procedural justice
customers of past dissatisfactory and interactional justice. Thus, procedural and interactional
experiences justice may be secondary to distributive justice.

Blodgett et al. (1995) Retail customers Retrospective When customers perceived a lack of distributive or
self-report survey interactional justice, they became unsatisfied, and this led
of past dissatisfactory to a high post-redress negative WOM and to a low
experiences intention to re-patronize.

Blodgett et al. (1993)
University staff Retrospective Overall perceived justice affected negative WOM and
self-report survey repatronage intentions. In addition, overall perceived
of past dissatisfactory justice was found to mediate the effects of likelihood of
experiences success, attitude toward complaining, product importance,
and stability and controllability on complaining behavior.

Goodwin and Ross (1992)
Undergraduate Between-subjects Apology (i.e., interactional justice) and voice appeared to
students experiment with enhance fairness and satisfaction perceptions in the ‘‘favorable
hypothetical scenarios outcome’’ condition, when consumers were offered a discount
or gift after service failure. When no tangible offering was made,
apology and voice had lesser effect and in some instances were
associated with lower perceptions of fairness and satisfaction.

Table 2
Construct measurements

Constructs and measurement items References

Distributive justice (x1) Blodgett et al. (1997); Smith et al. (1999)
 Compared to what you expected, the offer received (e.g., discount) was
 Taking everything into consideration, the manager’s offer was quite fair
 Given the circumstances, I feel that the hotel has offered adequate compensation
 The customers did not get what they deserved (i.e., regarding a refund, coupon,
and room upgrade, etc.) (R)
Procedural justice (x2) Blodgett et al. (1997); Karatepe (2006)
 My complaint was handled in a very timely manner
 My complaint was not resolved as quickly as it should have been (R)
 The procedure for handling my complaint was complicated (R)
 Employees made an effort to adjust the procedure of handling my complaint
according to my needs
Interactional justice (x3) Karatepe (2006); Smith et al. (1999); Tax et al. (1998)
 Employees were courteous to me
 Employees’ communication with me was appropriate
 Employees put the proper effort into resolving my problem
 Employees showed a real interest in trying to be fair
 Employees showed concern
Recovery satisfaction (h1) Brown et al. (1996); Maxham III and Netemeyer (2002)
 Overall, I am satisfied with the service I received
 I am satisfied with the manner in which the service failure was resolved
 This hotel’s response to the service failure was better than expected
 I now have a more positive attitude toward this hotel
Trust (h2) Morgan and Hunt (1994); Wong and Sohal (2002)
 This hotel’s employees can be trusted at all times
 This hotel’s employees have a high level of integrity
 This hotel’s employees made every effort to fulfill the promises made
to its customers
 Overall, this hotel is reliable
Word-of-mouth (h3) Mattila (2001); Wong and Sohal (2002)
 I would recommend this hotel to other people
 I would tell other people positive things about this hotel
Revisit intention (h4) Mattila (2001); Maxham III and Netemeyer (2002)
 I consider this hotel as my first choice compared to other hotels
 I have a strong intention to visit this hotel again

Note: R items were reverse scored.

56 T. (Terry) Kim et al. / Tourism Management 30 (2009) 51–62

were found to be unreliable, leaving a remaining 451 question- and less than $65,000, 14.2% between $25,000 and less than
naires that were retained for further data analysis. $45,000, and 9.5% less than $25,000.
The aforementioned sample characteristics exhibit that the re-
3.3. Data analysis spondents of this study are rather equally distributed in terms of
gender. However, age distribution shows that the majority of
Data were analyzed using the two-step approach (Anderson & respondents are in their 30s and 40s. The general picture of our
Gerbing, 1988). In the first step, a confirmatory factor analysis (CFA) sample can be depicted as adult, highly educated, affluent pro-
was performed to determine whether the measured variables re- fessionals. These sample characteristics show that our respondents
liably reflected the hypothesized latent variables. In the second represent typical Korean baby-boomers.
step, path analyses were tested to determine overall model fit, path
coefficients significance, and explanatory power (R2). 4.2. Measurement model
More specifically, because a competing model (Model 2) is
nested within a proposed model (Model 1), a c2 difference test was The adequacy of the measurement model was examined by
used. Also, to compare the proposed model (Model 1) with the confirmatory factor analysis (CFA). Table 4 demonstrates the results
competing model (Model 2), path analysis was used to compare the of the measurement model. Most of the model fit indices from CFA
two models in terms of overall model fit (including absolute fit demonstrated a good fit with c2 (df) ¼ 648.10 (254), normed c2 (c2/
measures, incremental fit measures, as well as parsimony fit mea- df) ¼ 2.55, goodness-of-fit index (GFI) ¼ 0.90, root mean square
sures), path coefficients significance, and explanatory power. error of approximation (RMSEA) ¼ 0.07, adjusted goodness-of-fit
index (AGFI) ¼ 0.86, normed fit index (NFI) ¼ 0.94, Tucker–Lewis
4. Results index (TLI) ¼ 0.95, and comparative fit index (CFI) ¼ 0.96. Although
the c2 statistic shows significant p-value, the relatively large sample
4.1. Respondents’ demographic profile size of our study (N ¼ 451) offsets the seriousness of the effect of
statistic to the validity of measurement model (Anderson &
The demographic profile of the respondents is presented in Gerbing, 1982). Collectively, the results of the CFA satisfy the rec-
Table 3. The sample consisted of 51.7% male and 48.3% female re- ommended level of goodness of fit, which implies that the mea-
spondents. Approximately 28.8% were single or divorced and 71.2% surement model generally fits the sample data well.
were married. In terms of age, 40.6% of the respondents were 40–49 In this study, an effort to purify the measurement scales was per-
years old, 23.9% were 30–39, 22.4% were 50 or older, and 13.1% were formed in the stage of employing the CFA for the purpose of delineating
younger than 30. The majority of the respondents (77.8%) were more valid constructs. Scale items displaying insignificant and low
highly educated, holding at least a college degree; 13.7% had some values of factor loadings were deleted from the measurement variables
graduate education. In terms of occupation, the largest group in the of each scale. It can also be noted that scale reliability is an important
distribution (31.9%) was administrative or managerial workers, measure of scale adequacy. When scale reliability is high, variables
followed by 23.3% professionals (such as doctors, lawyers, pro- measuring a single factor share a high degree of common variance
fessors, and researchers), 17.3% sales or service industry-related, (Sanders & Premus, 2005). The Cronbach’s alphas of the six constructs
15.5% self-employed workers, and 5.8% technical workers. With range from 0.83 (WOM) to 0.97 (revisit intention), which shows that
regard to annual household income, 35.3% of the respondents the measures are internally consistent because they are all above the
earned more than US$65,000, followed by 41.0% between $45,000 recommending criterion of 0.70 (Nunnally, 1978). Fornell and Larcker
(1981) suggest that composite construct reliability may be an alter-
native criterion to Cronbach’s alpha in examining the internal consis-
Table 3 tency of the variables in the measurement model. The composite
Profile of the respondents
construct reliability of each construct ranges from 0.70 (WOM) to 0.93
Variables Frequency (N ¼ 451) (revisit intention), exceeding a suggested minimum of 0.70 (Bagozzi,
N % 1980). The results show that all scales of the measurement model
Gender demonstrate adequate internal consistency for further analysis of the
Male 233 51.7 construct model.
Female 218 48.3
Martial status 4.3. Convergent and discriminant validity
Single or divorced 130 28.8
Married 321 71.2
Age (year) Convergent validity exists when a researcher’s proposed scale
Less than 30 59 13.1 items for the same construct are correlated strongly with significance.
30-39 108 23.9 The standardized loadings and the squared multiple correlation (SMC)
40-49 183 40.6
for the measurement items and the constructs were examined as
50 or older 101 22.4
Education level evidences of convergent validity (Bollen, 1989). Significant factor
Associate degree or below 100 22.2 loadings for a specific construct suggest a confirmation of convergent
College 289 64.1 validity such that indicators for a given construct should be at least
Graduate school 62 13.7 moderately correlated among themselves. All items loaded signifi-
Occupation
Self-employed/owner 70 15.5
cantly on their constructs with the lowest critical ratio (t-value) of
Administrative/managerial 144 31.9 15.61 (p < 0.001), indicating that the specific measurement variables
Professional 105 23.3 are sufficient in their representation of the constructs (Hair, Anderson,
Sales/service 78 17.3 Tatham, & Black, 1998). In addition, the convergent validity can be
Technical 26 5.8
achieved when the SMC between the items and the construct is
Others 28 6.2
Annual household income (US$) greater than the cut-off value of 0.40 (Bollen, 1989; Kline, 1986). Since
Less than $25,000 43 9.5 all the SMC of each item surpassed the recommended level, evidence
$25,000 – Less than $45,000 64 14.2 of convergent validity for the tested items is provided.
$45,000 – Less than $65,000 185 41.0 Evidence of discriminant validity is demonstrated when
$65,000 or more 159 35.3
measures of conceptually different constructs are not strongly
 T. (Terry) Kim et al. / Tourism Management 30 (2009) 51–62 57

Table 4
Measurement model results

Constructs and measurement items Standardized loadings t-Values SMCs

Distributive justice (x1; a ¼ 0.91; AVE ¼ 0.56; CCR ¼ 0.84)
Compared to what you expected, the offer received (e.g., discount) was 0.80 16.00 0.64
Taking everything into consideration, the manager’s offer was quite fair 0.84 16.87 0.70
Given the circumstances, I feel that the hotel has offered an adequate compensation 0.94 – 0.89
I did not get what I deserved (i.e., regarding a refund, coupon, room upgrade) (R) 0.95 17.83 0.90

Procedural justice (x2; a ¼ 0.93; AVE ¼ 0.55; CCR ¼ 0.86)

My complaint was handled in a very timely manner 0.73 21.69 0.54
My complaint was not resolved as quickly as it should have been (R) 0.96 42.32 0.92
The procedure for handling my complaint was complicated (R) 0.97 – 0.93
Employees made an effort to adjust the procedure of handling my complaint 0.74 21.15 0.55
according to my needs

Interactional justice (x3; a ¼ 0.92; AVE ¼ 0.49; CCR ¼ 0.83)

Employees were courteous to me 0.97 – 0.93
Employees’ communication with me was appropriate 0.85 30.97 0.72
Employees put the proper effort into resolving my problem 0.68 19.52 0.46
Employees showed a real interest in trying to be fair 0.96 47.48 0.92
Employees showed a concern 0.65 18.07 0.42

Recovery satisfaction (h1; a ¼ 0.93; AVE ¼ 0.52; CCR ¼ 0.82)

Overall, I am satisfied with the service I received 0.80 22.59 0.64
I am satisfied with the manner in which the service failure was resolved 0.85 25.13 0.71
This hotel’s response to the service failure was better than expected 0.89 – 0.79
I now have a more positive attitude toward this hotel 0.88 26.38 0.78

Trust (h2; a ¼ 0.86; AVE ¼ 0.51; CCR ¼ 0.75)

This hotel’s employees can be trusted at all times 0.80 15.61 0.63
This hotel’s employees have a high level of integrity 0.72 16.11 0.52
This hotel’s employees make every effort to fulfill the promises made 0.77 17.62 0.59
to its customers
Overall, this hotel is reliable 0.87 – 0.76

Word-of-mouth (h3; a ¼ 0.83; AVE ¼ 0.54; CCR ¼ 0.70)

I would recommended this hotel to other people 0.85 21.72 0.72
I would tell other people positive things about this hotel 0.85 – 0.71

Revisit intention (h4; a ¼ 0.97; AVE ¼ 0.88; CCR ¼ 0.93)

I consider this hotel as my first choice compared to other hotels 0.97 44.00 0.94
I have a strong intention to visit this hotel again 0.97 – 0.93

Model fit measures
c2 (df) 648.10 (254)
Normed c2 2.55
GFI 0.90
RMSEA 0.07
AGFI 0.86
NFI 0.94
TLI 0.95
CFI 0.96

Note: All standardized loadings are significant at the 0.01 level or better. GFI ¼ goodness-of-fit index, RMSEA ¼ root mean square error of approximation, AGFI ¼ adjusted
goodness-of-fit index, NFI ¼ normed fit index, TLI ¼ Tucker–Lewis index, CFI ¼ comparative fit index, SMC ¼ squared multiple correlation, AVE ¼ average variance extracted,
CCR ¼ composite construct reliability. Normed c2 ¼ c2/df. R items were reverse scored. CCR ¼ (S standardized loadings)2/(S standardized loadings)2 þ (S indicator mea-
surement error), AVE ¼ (S squared standardized loadings)/(S squared standardized loadings) þ (S indicator measurement error).

correlated among themselves. To assess the discriminant validity,
the square root of the average variance extracted (AVE) in each
construct is compared to the correlation coefficients between two
constructs (Fornell & Larcker, 1981). One pair of scales between
trust and WOM appeared to have relatively high correlation
(F ¼ 0.71) (see Table 5). The variances extracted for both constructs
were 0.51 and 0.54, respectively (see Table 4). Since the two vari-
ances are greater than the square of the correlation coefficients
(F2 ¼ 0.50), a discriminant validity is confirmed. These results
exhibit that the variables in our measurement model appear to
have acceptable levels of discriminant validity.
4.4. Path model testing
4.4.1. Proposed model (Model 1)
The results of the structural model tested are illustrated in Fig. 1.
Using the path analysis, the predicted relationships among exoge-
nous and endogenous constructs were tested. The maximum like-
lihood (ML) estimation was employed to estimate the structural
parameters of the model. In comparison with values suggested by
Hu and Bentler (1999), the overall fit of the model to the data
resulted acceptable statistics as follows: c2 (df) ¼ 27.15 (10),
normed c2 ¼ 2.72, GFI ¼ 0.98, RMSEA ¼ 0.07, AGFI ¼ 0.95,
NFI ¼ 0.99, TLI ¼ 0.97, and CFI ¼ 0.99.
All structural path estimates were significant at the 0.01 level,
where the signs of all structural paths were consistent with the
hypothesized relationships among the latent constructs. The model
accounted for a substantial proportion of the variance (R2) in four
endogenous variables: 47.2% of variance in recovery satisfaction,
34.1% in trust, 63.7% in WOM, and 52.5% in revisit intention (see
Fig. 1).
Hypothesis testing generally led to support for all of the hy-
potheses proposed. Regarding the relationships between perceived
justice and recovery satisfaction, distributive (Hypothesis 1a:
g11 ¼ 0.49, p < 0.01), procedural (Hypothesis 1b: g12 ¼ 0.17,
p < 0.01), and interactional perception (Hypothesis 1c: g13 ¼ 0.24,
p < 0.01), all appeared to have significant influences on recovery
satisfaction with complaint handling. It is noteworthy here that the
58 T. (Terry) Kim et al. / Tourism Management 30 (2009) 51–62

Table 5
Correlation estimates, construct means, and standardized deviations

Constructs Number of items M SD 1 2 3 4 5 6 7

1. Distributive justice (x1) 4 3.94 1.46 1.00
2. Procedural justice (x2) 4 3.84 1.44 0.32 1.00
3. Interactional justice (x3) 5 4.14 1.38 0.21 0.28 1.00
4. Recovery satisfaction (h1) 4 3.97 1.47 0.61 0.40 0.40 1.00
5. Trust (h2) 4 4.29 1.27 0.33 0.33 0.41 0.59 1.00
6. Word-of-mouth (h3) 2 4.31 1.35 0.41 0.31 0.39 0.68 0.71 1.00
7. Revisit intention (h4) 2 4.60 1.41 0.33 0.29 0.42 0.63 0.67 0.70 1.00

Note: Composite scores were calculated by averaging scores items representing that construct. The scores range from 1 to 7. A higher score indicates a more favorable response.
All correlations are significant at the 0.01 level or better.

effect of perceived DJ on recovery satisfaction is stronger than those
of perceived PJ and IJ.
As hypothesized, recovery satisfaction was positively associated
with trust (Hypothesis 2: b21 ¼ 0.54, p < 0.01), WOM (Hypothesis 3:
b31 ¼ 0.37, p < 0.01), and revisit intention (Hypothesis 4: b41 ¼ 0.36,
p < 0.01). This shows that a customer’s recovery satisfaction would be
affected more significantly by DJ than by either PJ or IJ. Furthermore,
trust had a significant effect on WOM (Hypothesis 5: b32 ¼ 0.52,
p < 0.01) and revisit intention (Hypothesis 6: b42 ¼ 0.46, p < 0.01),
which would imply the significant mediating role of trust in the causal
link from recovery satisfaction to WOM and revisit intention.
4.4.2. Competing model (Model 2)
In addition to the proposed model (Model 1) illustrated in Fig. 1,
a competing model (Model 2) was tested (see Fig. 2). In the com-
peting model (Model 2), recovery satisfaction was presumed to
have only an indirect effect on WOM and revisit intention; that is,
the competing (full-mediation) model (Model 2) was nested within
the proposed (partial-mediation) model (Model 1), emphasizing
the mediating role of trust from recovery satisfaction to WOM and
revisit intention. The competing model (Model 2) achieved a good
level of fit (c2 (df) ¼ 41.09 (12), normed c2 ¼ 3.42, GFI ¼ 0.97,
RMSEA ¼ 0.08, AGFI ¼ 0.90, NFI ¼ 0.97, TLI ¼ 0.93, CFI ¼ 0.98),
which reinforces the intervening role of trust for final performance
of service recovery efforts.
All structural path estimates were significant at the 0.01 level,
where the signs of all structural paths were consistent with the
hypothesized relationships among the latent constructs. The model
accounted for a substantial proportion of the variance (R2) in four
endogenous variables: 43.3% of variance in recovery satisfaction,
34% in trust, 42.7% in WOM, and 42.2% in revisit intention (see
Fig. 2).
4.4.3. Model comparison
The model comparison should focus on assessing model fit and
compare the fit of competing and theoretically plausible models
(Kelloway, 1998). As both the proposed model (Model 1) and the
competing model (Model 2) fit the original data appropriately, a c2
difference test was employed to determine if one of these struc-
tures performed better than the other (Anderson & Gerbing, 1988;
Bentler & Bonett, 1980) (see Figs. 1 and 2).
As shown in Table 6, the c2 statistics between the two models
were compared using the proposed model (Model 1) as a reference
point. The c2 statistics’ difference between the two models was
significant (Dc2 ¼ 13.94, Ddf ¼ 2, p < 0.001), which indicated that
adding the direct paths from recovery satisfaction to WOM and
revisit intention does improve its fit, though both models had met
the fit criteria. In this type of model comparison, parsimony fit
measures such as CFI (Bentler, 1990), the Akaike information cri-
terion (AIC) (Akaike, 1987; Arbuckle, 2006; Jöreskog & Sörbom,
1993), and the Browne–Cudeck criterion (BCC) (Arbuckle, 2006;
Browne & Cudeck, 1989) are appropriate for model comparison
because these assess parsimony as well as fit (Rust, Lee, & Valente,
1995). As shown in Table 6, in the case of the proposed model
(Model 1), CFI is 0.99, and in the case of the competing model
(Model 2), CFI is 0.98. As bigger value of this criteria indicates
a better fit of the model, these results indicated a preference for the
proposed model (Model 1) over the competing model (Model 2). In

D3
Distributive Word-of-mouth
0.66
justice (η3)
(ξ1) (R2 = 0.64)
H1a (γ11): 0.49** **
D1
0.66** **
0.75
D2
Recovery
Procedural H1b (γ12): 0.17** satisfaction
** Trust 0.86
0.43** justice (η2)
(η1) 2
(ξ2) (R = 0.34)
(R2 = 0.47)

**
0.50**
D4
H1c (γ13): 0.24** **
Revisit
Interactional 0.54
intention
justice
(η4)
(ξ3)
(R2 = 0.53)

Fig. 1. Results of the proposed model (Model 1). Model fit measures: c2 (df) ¼ 27.15 (10), normed c2 ¼ 2.72, GFI ¼ 0.98, RMSEA ¼ 0.07, AGFI ¼ 0.95, NFI ¼ 0.99, TLI ¼ 0.97, CFI ¼ 0.99.
Note: Normed c2 ¼ c2/df. GFI ¼ goodness-of-fit index, RMSEA ¼ root mean square error of approximation, AGFI ¼ adjusted goodness-of-fit index, NFI ¼ normed fit index,
TLI ¼ Tucker–Lewis index, CFI ¼ comparative fit index. **p < 0.01.
 T. (Terry) Kim et al. / Tourism Management 30 (2009) 51–62
Distributive
justice
(ξ1)
γ11: 0.49**
0.66**
Recovery
Procedural γ12: 0.17**
0.33** justice
satisfaction
(η1)
(ξ2)
(R2= 0.43)
0.43**
γ13: 0.25**
Interactional
justice
(ξ3)
Fig. 2. Results of the competing model (Model 2). Model fit measures: c2 (df) ¼ 41.09 (12), normed c2 ¼ 3.42, GFI ¼ 0.97, RMSEA ¼ 0.08, AGFI ¼ 8.90, NFI ¼ 0.97, TLI ¼ 0.93, CFI ¼ 0.98.
Note: Normed c2 ¼ c2/df. GFI ¼ goodness-of-fit index, RMSEA ¼ root mean square error of approximation, AGFI ¼ adjusted goodness-of-fit index, NFI ¼ normed fit index,
TLI ¼ Tucker–Lewis index, CFI ¼ comparative fit index. **p < 0.01.
the case of the proposed model (Model 1), AIC is 64.15 and BCC is
64.78, while the values for the competing model (Model 2) are
AIC ¼ 81.09 and BCC ¼ 81.90, respectively. As smaller values of
these criteria indicate a better fit of the model (Kelloway, 1998),
these results indicate a preference for the proposed model (Model
1) over the competing model (Model 2). In addition, parsimony
goodness-of-fit index (PGFI) [the proposed model (Model 1): 0.78;
the competing model (Model 2): 0.74] and parsimony normed fit
index (PNFI) [the proposed model (Model 1): 0.88; the competing
model (Model 2): 0.83], which assesses the parsimony fit of com-
peting models (Kelloway, 1998), favor the proposed model (Model
1). Also, for this type of model comparison, the most common
statistical test is normed c2 (Rust et al., 1995). As shown in Table 6,
in the case of the proposed model (Model 1), normed c2 is 2.72,
in the case of the competing model (Model 2), normed c2 is 3.42.
As smaller value of this criteria indicates a better parsimony as
well as a better fit of the model, this result indicated a preference
for the proposed model (Model 1) over the competing model
(Model 2).
More specifically, the indirect effects of recovery satisfaction on
WOM and revisit intention via trust appeared to be relatively
smaller than the direct ones. In sum, compared to the competing
model (Model 2), the exploratory power of the proposed model
(Model 1) had increased by adding the two direct effects of re-
covery satisfaction on WOM and revisit intention: the largest in-
crement in R2 was 0.21 for WOM [0.64 for the proposed model
(Model 1) – 0.43 for the competing model (Model 2)] and 0.11 [0.53
for the proposed model (Model 1) – 0.42 for the competing model
(Model 2)] for revisit intention. Overall, the results suggest that in
a comparison between the proposed model (Model 1) interpreting
trust as a mediating role between the recovery satisfaction and
both WOM and revisit intention and the competing model (Model
2), the proposed model (Model 2) is slightly superior to the com-
peting model (Model 1).
In summary, the models shown in Figs. 1 and 2 can be ordered
in a nested sequence (nested model) to compare model fit,
exploratory power, and parameter estimates as shown in Table 6.
The difference in c2 and degrees of freedom (df), the fit statistics
including absolute fit measures, incremental fit measures, and
parsimony fit measures, as well as exploratory power, indicate that
the proposed model (Model 1) is slightly superior to the competing
model (Model 2).
59
D3
Word-of-mouth 0.79
(η3)
(R2= 0.43)
D1
β32: 0.74**
0.84
D2
β21: 0.54** Trust 0.90
(η2)
(R2= 0.34)
β42: 0.67**
D4
Revisit
intention 0.58
(η4)
(R2 = 0.42)
4.4.4. Direct and indirect effects
The direct and indirect effects in the proposed model (Model 1)
were further examined in an effort to gain in-depth insights into
the customer’s WOM and revisit intention process with service
recovery (see Table 6). Since the proposed model (Model 1) dem-
onstrated a better fit than the competing model (Model 2), the
interpretation of direct and indirect effects focuses on the proposed
model (Model 1) herewith.
Perceived DJ (0.27), PJ (0.06), and IJ (0.14) affected trust positively
via recovery satisfaction, where the DJ perception had the largest ef-
fect on trust via recovery satisfaction. The results show that the effect
of PJ on trust via recovery satisfaction was relatively small, whereas
the effect of DJ on trust via recovery satisfaction was substantial.
Table 6 presented the mediational roles of recovery satisfaction
and trust between DJ (0.32), PJ (0.09), and IJ (0.16) and WOM. In
particular, the effect of perceived DJ on WOM via recovery satis-
faction and trust was found to be the greatest. The data further
suggested DJ (0.31), PJ (0.09), and IJ (0.14) exerted positive effects on
revisit intention via recovery satisfaction and trust. In particular, DJ
perception had the largest effect on revisit intention via recovery
satisfaction and trust. The results also show that the effect of PJ on
revisit intention via recovery satisfaction and trust was not im-
portant, but the effects of DJ and IJ on revisit intention via recovery
satisfaction and trust were substantial.
The direct effect of recovery satisfaction on WOM appeared to be
significant (0.37). Also, the indirect effect via trust was found to be
apparent (0.29). Therefore, trust served as an important mediating
variable between recovery satisfaction and WOM. The results show
that the direct effect of recovery satisfaction on revisit intention via
trust was noticeable with 0.36, and the indirect effect of recovery
satisfaction on revisit intention via trust was noticeable with 0.25.
Thus, these results indicate that the mediational role of trust
between recovery satisfaction and revisit intention is substantial.
5. Discussion and conclusions
Repeat guests are an essential asset to any successful hotel
business. The most effective way to retain repeat guests is to attain
high customer expectations or to provide a service that exceeds the
customers’ expectations. Unfortunately, however, flawless cus-
tomer service may be a practically unattainable goal, because the
hotel business has such unique characteristics as simultaneous
60 T. (Terry) Kim et al. / Tourism Management 30 (2009) 51–62

Table 6 higher customer loyalty, whereas the poor responses may prompt
Comparison of the proposed model (Model 1) and the competing model (Model 2) customers to switch hotels. Thus, an effective effort for service re-
Paths Proposed model Competing model covery after experiencing faulty service must be carefully planned
(Model 1) (Model 2) and carried out in order to establish a long-term relationship with
Path coefficients (t-values) the customers.
Direct effects The empirical results testing the relationships between per-
H1a (g11): distributive justice / 0.49 (13.74)** 0.49 (13.74)** ceived justice with service recovery, recovery satisfaction, trust,
recovery satisfaction WOM, and revisit intention demonstrated that all hypothesized
H1b (g12): procedural justice / 0.17 (4.58)** 0.17 (4.58)**
relationships were supported. The impact of DJ on recovery satis-
recovery satisfaction
H1c (g13): interactional justice / 0.24 (6.92)** 0.25 (6.92)**
faction appears to be stronger than that of PJ or IJ, which is consis-
recovery satisfaction tent with the previous findings of Smith et al. (1999) and Maxham III
H2 (b21): recovery satisfaction / trust 0.54 (13.97)** 0.54 (13.97)** and Netemeyer (2002). The significant role of DJ in affecting cus-
H3 (b31): recovery satisfaction / word- 0.37 (10.56)** tomer satisfaction would be supported by fair distributive treatment
of-mouth
such as ‘‘refunds,’’ ‘‘discounts,’’ ‘‘coupons,’’ ‘‘upgrading a room,’’ and
H4 (b41): recovery satisfaction / revisit 0.36 (8.96)**
intention ‘‘offering free room and/or food,’’ which are surely important in
H5 (b32): trust / word-of-mouth 0.52 (15.03)** 0.74 (23.45)** winning back satisfaction from disgruntled hotel guests. The impact
H6 (b42). trust / revisit intention 0.46 (11.46)** 0.67 (19.03)** of IJ on recovery satisfaction is found to be stronger than that of PJ
Indirect effects (Davidow, 2003; Karatepe, 2006). To proceed appropriate IJ, hotel
Distributive justice / trust 0.27 (7.10)** 0.29 (7.11)** staffs may be alerted to respond by offering apologies (Smith et al.,
Procedural justice / trust 0.06 (1.82)n.s. 0.07 (1.85)n.s. 1999), showing empathy and attentiveness (Karatepe, 2006), or
Interactional justice / trust 0.14 (2.65)** 0.14 (2.66)**
appearing courteous and respectful (Blodgett et al., 1997). In all, our
Distributive justice / word-of-mouth 0.32 (8.72)** 0.22 (5.14)**
Procedural justice / word-of-mouth 0.09 (1.91)n.s. 0.08 (1.84)n.s. results imply that when hotel management should exert the service
Interactional justice / word-of-mouth 0.16 (4.26)** 0.11 (2.35)* recovery efforts, they should monitor all three justice dimensions of
Recovery satisfaction / word-of-mouth 0.29 (7.29)** 0.43 (10.01)** recovery outcomes: fair monetary compensation for discontented
Distributive justice / revisit intention 0.31 (7.51)** 0.20 (4.13)** guests (i.e., DJ), existing recovery policy and process to resolve the
Procedural justice / revisit intention 0.09 (1.90)n.s. 0.04 (1.74)n.s.
Interactional justice / revisit intention 0.14 (4.14)** 0.08 (1.79)n.s.
service failure (i.e., PJ), and employee–guest communications (i.e.,
Recovery satisfaction / revisit intention 0.25 (6.93)** 0.39 (10.14)** IJ) (Tax et al., 1998). Regarding the PJ, hotel employees must keep in
mind that timeliness in resolving conflicts (Blodgett et al., 1997) and
Model fit measures
Absolute fit measures high customer voice and the neutrality of the recovery process
c2 27.15 41.09 (Karande et al., 2007; Sparks & McColl-Kennedy, 2001) must be
df 10 12 handled carefully.
Normed c2 2.72 3.42 Our findings also show that the effect of recovery satisfaction on
GFI 0.98 0.97
trust is significant and positive (Ganesan, 1994; Garbarino & John-
RMSEA 0.07 0.08
son, 1999; Tax et al., 1998), and in turn, the trust is positively as-
Incremental fit measures
sociated with WOM and revisit intention (Garbarino & Johnson,
AGFI 0.95 0.90
NFI 0.99 0.97
1999; Kim, Han, & Lee, 2001; Oh, 2002). Particularly, the important
TLI 0.97 0.93 role of trust as an antecedent of WOM and revisit intention co-
incides with Kim et al.’s (2001) findings that trust and satisfaction
Parsimony fit measures
CFI 0.99 0.98 play important roles in stimulating customers’ revisit intentions. In
PGFI 0.78 0.74 the hotel industry, appropriate relationship marketing through
PNFI 0.88 0.83 establishing trust is important to form, maintain, and improve
AIC 64.15 81.09 a sound business relationship with customers. Once satisfaction
BCC 64.78 81.90
Dc2 13.94**
with service recovery is met, trust gives confidence to customers
Ddf 2 about the service provider, so future behavior of the customer can
be voluntarily and positively geared toward the company through
Exploratory power
R2 Recovery satisfaction 0.47 0.43 revisit intention, WOM references, and recommendations.
R2 Truth 0.34 0.34 The significant and positive effect of recovery satisfaction on
R2 Word-of-mouth 0.64 0.43 WOM and revisit intention confirms that service recovery efforts
R2 Revisit intention 0.53 0.42 after failure could ultimately enhance the customer relationship
Note: c2 difference test was computed based on comparison to the proposed model (McCollough, 2000; McDougall & Levesque, 2000). This corrobo-
(Model 1). GFI ¼ goodness-of-fit index, RMSEA ¼ root mean square error of ap- rates that a customer can build on a positive feeling by the hotel’s
proximation, AGFI ¼ adjusted goodness-of-fit index, NFI ¼ normed fit index,
efforts of effective service recovery, and the relationship between
TLI ¼ Tucker–Lewis index, CFI ¼ comparative fit index, PGFI ¼ parsimony goodness-
of-fit index, PNFI ¼ parsimony normed fit index, AIC ¼ Akaike information criterion, the service provider and customer can be fortified (Smith et al.,
BCC ¼ Browne-Cudeck criterion. Normed c2 ¼ c2/df. n.s. indicates not significant. All 1999; Tax et al., 1998). The effective service recovery would be one
texts in bold are used to provide a list of criteria that were used to distinguish model of the most important factors in attaining customer repatronage
1 and model 2. (Blodgett et al., 1997; Wirtz & Mattila, 2004).
*Significant at p < 0.05.
**Significant at p < 0.01.
The results of this study provide useful insights into the be-
havior of hotel guests who have experienced faulty service with the
subsequent follow-up action of service recovery. The study results
production and consumption and intangibleness (Collie et al., should help to enlighten the efforts of any hotel manager who
2000). An effective recovery strategy after service breakdown, pursues to ensure that the guests receiving service recovery efforts
therefore, can play an important role in maintaining or increasing perceive a high level of satisfaction. Some more practical implica-
long-term customer loyalty (Brown et al., 1996; McCollough et al., tions are suggested herewith. First, considering the utmost im-
2000; Maxham III, 2001; Ok et al., 2005; Smith & Bolton, 1998). portance of DJ, hotel management should develop specific
When a service breakdown occurs, the effective reactions of the monetary compensation guidelines while training both full- and
service providers can help create even stronger bonds and lead to part-time employees to quickly and properly react to various
 T. (Terry) Kim et al. / Tourism Management 30 (2009) 51–62
service failure situations. A comprehensive training program can
facilitate in selecting the appropriate level of compensation (room
discount versus upgrading a room). Depending on different levels
of complaints and different situations of guests, hotel management
needs to train front desk staff to offer proper arrays of compensa-
tions with similar values and let their guests select the best com-
pensation. Since compensation with less economic value could be
more appealing to a displeased guest, offering optimal compensa-
tion with less cost will be a win–win remedy for both an unhappy
guest and hotel. For example, a room upgrade may be a better re-
dress for a corporate business traveler who is making a business
trip using business account. However, the same guest would most
likely prefer a room discount to a room upgrade when he/she is on
vacation.
In order to enhance the PJ practice, a training program should
focus on instilling the proper procedures and the correct policies by
reacting to customer problems quickly and handling guest com-
plaints in a timely manner. In addition, hotel managers should
implement a training program, which clearly illustrates the ex-
emplary reactions improving the IJ practice via teaching how to
properly treat angry guests, demonstrating empathy and atten-
tiveness, and offering a genuine apology. Situational questions and
role playing can be an effective way for guest-contact employees to
learn what to do and what not to do in non-routine situations. Hotel
managers should consider suitable rewards and recognition for
their staff’s smart choice of exemplary recovery efforts to stimulate
their voluntary participation (Karatepe, 2006).
Second, guest-contact employees should be empowered in such
a way as to provide a quick recovery resolution for any service
breakdown. It is important for hotels to incorporate empowerment
and mentoring procedures into their operating manuals by clearly
delineating the critical issues such as the maximum monetary in-
centive of contact employees without supervisor approval; the
promptness of the responses; and the employees’ behavioral re-
sponses of showing empathy and compassion, of giving an apology,
and of allowing flexibility of complaining procedures (Tax et a1.,
1998). When hotel managers empower their guest-contact em-
ployees, it is important for them to clearly identify authority and
decision-making boundaries. These boundaries need to be revisited
by employees and managers when staff empowerment efforts were
not successful. A caveat for managers is to meet basic needs of
employees and to make sure that employees are not under-
compensated, undertrained, overworked, and underappreciated
(Karatepe, 2006). Under those negative circumstances, empowered
employees are not likely to demonstrate any discretionary energy
nor to make any extra efforts to remedy service failures. Managers
need to coach their employees and to provide proper training and
learning opportunities to assure their employees make better de-
cisions in the future. It is critical for managers to have a strong trust
in their staff’s capability to respond to complaints or service fail-
ures. It is also crucial for managers to avoid micro-management;
this avoidance will enhance the employees’ morale and team sprit
leading to customer satisfaction and long-term bottom line.
Finally, the ultimate goal of service recovery is not limited to
preventing the loss of customers, but rather to maintain a long-
term cooperative relationship with customers. Our findings, then,
will be useful to hotel managers for developing procedures that
maximize the customer satisfaction with service recovery and
subsequently augment long-term customer relationships.
6. Limitations and future research directions
Of course, there are some limitations that this study could not
escape. First, the results of this study might be affected by re-
spondents’ memory bias, because the study was based on the cross-
sectional survey to respondents who had stayed in five-star hotels.
61
Future research needs to adopt a longitudinal design to trace the
relationship between customers’ perceived justice associated with
service recovery over time, because most relationship variables
may be measured more accurately in the time-series design.
Second, future research may focus on the empirical validation of
the recovery paradox across different segments (e.g., accommo-
dation, restaurant, casino, theme park, and other recreation busi-
nesses) of the tourism industry. Also, the recovery paradox may not
be realized, because the impact of the first critical failure is too
devastating to be overcome by recovery efforts in some sectors of
the tourism industry. However, the recovery paradox could be
found in other segments of tourism industry, so that further
research may confirm it across different types of businesses (e.g.,
resort hotels vs. downtown hotels or luxury restaurants vs. quick-
service restaurants) within a segment of the tourism industry.
Third, the results of this study need to be cautiously generalized
because the sample is limited to hotel guests from a single country
in Asia. It will be interesting to see the findings gleaned from
a similar study conducted on hotel guests from Western cultures.
Also, future researchers should conduct cross-cultural studies to
explore the role of culture in justice theory.
Fourth, although this study, like the majority of similar studies,
presumes satisfaction as an antecedent of trust (Garbarino &
Johnson, 1999; Morgan & Hunt, 1994), another study presumes that
trust was established as an antecedent of satisfaction (Anderson &
Narus, 1990). Further research would be able to validate a more
solid basis of causal relationships among recovery satisfaction and
trust.
Finally, future research may consider some significant moder-
ating variables between the three dimensions of perceived justice
and satisfaction, such as the length of relationship with the hotel,
frequency of hotel stay, and the purpose of customers’ travels.
Acknowledgement
The authors would like to thank the three anonymous reviewers
of Tourism Management for their helpful insights in improving this
paper.
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