Purpose: This paper empirically examines the direct and indirect effects of perceived termination severity on customers' behavioral reactions via betrayal and justice. It also examines the moderating effects of attitude toward complaining (ATC).
Design/methodology/approach: This paper employs a quantitative method approach using a scenario-based experiment in a banking setting.
Findings: The results show that a more severe termination approach results in higher customer negative reactions. Betrayal is shown to be a key driver of customers' behavioral reactions, and ATC moderates these effects.
Research limitations/implications: Future studies should examine the effects of different termination strategies in markedly different cultures and should also examine other boundary conditions such as prior warning, relationship quality and service importance in influencing customers' negative behavioral responses.
Originality/value: This paper contributes to the service termination literature by shedding light on the impact of termination severity on customers' reactions. It also unveils the mechanism that explains customers' reactions to service termination. Further, it reveals that ATC moderates customers' public (but not private) complaining behaviors.
- customer complaint behavior
- firm-initiated service termination
- perceived justice
- termination severity