Managing Service Recovery via Social Media: The Impact of Transparency and Service Recovery Type in the Distribution of Feedback

Purpose: The popularity of social media has altered how customers interact with businesses, and an increasing number of customers prefer to voice their complaints on social media. Bystanders can observe the customer complaint process on social media, but the impact of transparency on bystanders remains uncertain. Therefore, this study established and verified a model for defining the effect of transparency and service recovery types on bystanders. Research Design and Methodology: In this study, we used the internet survey platform “So Jump” to collect data. And we validated three studies with SPSS 26.0 and Smart PLS 4.0. Result: First, we showed that the transparency process (vs. result) is more likely to increase customer forgiveness and E-loyalty and reduce E-NWOM intention among bystanders. Second, customer forgiveness also plays a complementary mediating role between transparency and E-loyalty, as well as between transparency and E-NWOM intention. Finally, we found a modest interaction effect between transparency (process vs. result) and service recovery types (psychological vs. tangible vs. hybrid) on bystanders’ customer forgiveness and E-loyalty. Conclusions: This study provides actionable recommendations for how service managers can effectively employ social media as a means for distributing feedback information to manage service recovery in the future.