The actions that an organization takes when any service failure occurs can be referred to as service recovery.
It can be understood as a pre-planned strategy or course of activity undertaken by the company for converting the dissatisfied or aggrieved state of clients into a satisfied state.
Numerous research studies have revealed that clients whose service failures are resolved speedily by the company are more loyal in comparison with those clients who never faced any service failure.
Thus, the practices of service recovery hold significant importance in any customer loyalty program, effective service recovery, handling complaints and retaining customers.
Service recovery, in a particular way, is a positive approach to handling complaints. Although there are various negative implications associated with complaint handling, service recovery has positive implications.
Therefore, the practices of service recovery act as a way for the company to achieve latent and potential customer value by developing a positive and fruitful relationship with them.