The social nature of customer experiences creates complex and potentially detrimental dynamics in failure situations, such as when other customers side with the complainer or the firm. The present research is the first to analyze such coalitions and their consequences. We conceptualize a triad composed of a complainer, a service employee, and one or multiple others as a third actor. A field study of consumer complaints on social media shows that coalitions occur in 32% of cases, negatively shifting the affective tone of an online conversation from approximately neutral to negative. Both third actor-complainer and third actor-service employee coalitions independently deteriorate the affective tone, their individual effects are not additive, and the third actor-complainer coalition exerts the larger impact of both coalitions. Two experiments reveal that complainers feel betrayed by the third actor when this actor sides with the service employee (vs. the complainer), which strengthens complainers' satisfaction with taking steps as a recovery effort by the firm and weakens satisfaction with an offered apology. This research provides managerial insights into the practical significance of coalition effects, how coalitions impair firm response effectiveness, and under which conditions different responses sustain their effectiveness. It also presents several avenues for future research.

Service encounters nowadays are increasingly characterized by customer-to-customer (C2C) interactions where customers regularly become targets of other customers' misbehavior. Although previous research provides initial evidence of the contagiousness of such C2C misbehavior, it remains unclear whether, how, and why C2C misbehavior spreads when frontline employees (FLEs) are involved and what FLEs can do to curb it. Two online and one field experiment in the context of co-working and transportation services reveal that FLE-directed blame attributions drive the spread of C2C misbehavior while perpetrator-directed blame attributions reverse it. These blame attributions are greater the more severely customers judge other customers' misbehavior. Findings further rule out alternative contagion mechanisms (social norms and emotional contagion) and show that contagion spills over to C2C misbehavior unrelated to the initial transgression. By specifying how contagion unfolds and by explicating the central role blame attributions play in C2C misbehavior contagion, this research uncovers its social dynamics, thus extending existing theory on customer misbehavior and attribution theory in multi-actor settings. Managerially, this research provides FLEs with explicit guidance on what they should do (personalized FLE interventions delivered either in person or remotely) and avoid doing (disapproving looks, FLE service recovery) when faced with C2C misbehavior.

One key challenge for consumers at the base of the pyramid (BoP) is access to products that could transform their livelihood, leading to nonconsumption as the dominant pattern. Previous studies have claimed that nonconsumption could be addressed with services offering access to goods without ownership. Drawing on expected utility theory, we conduct two experimental studies in rural India that provide the first empirical support for the idea that the availability of access-based services reduces nonconsumption at the BoP. Additionally, we show that this effect is explained by BoP consumers' expected utility assessment as reflected in their perception of access being more affordable and entailing less financial risk than ownership. We also demonstrate that access temporality, an important configurational variable for access-based service providers, affects the degree to which nonconsumption can be decreased. Compared to short-term access, BoP consumers perceive long-term access to be too similar to ownership in terms of affordability and financial risk, which causes them to refrain from purchasing. Overall, the results suggest that access-based services represent a viable alternative for addressing nonconsumption at the BoP. However, service providers should be aware that short-term access is required to gain acceptance among BoP consumers.

Service innovation is a key source of competitive differentiation across firms and markets. Despite growing attention from practitioners and academics alike, systematic scholarly inquiry into service innovation's diverse theoretical foundations has to date been limited. This article explores different approaches to service innovation and proposes a typology of four archetypes, each informed by a distinct theoretical perspective and by different underlying assumptions. Process-based and output-based archetypes focus on value-adding phases and output value, respectively. Experiential and systemic archetypes have attracted less attention but become central for firms seeking to cocreate phenomenologically determined value within the service ecosystem. The article also contributes to service innovation research and practice by bringing together the existing archetypes, which were previously treated separately. Juxtaposing these archetypes and emphasizing value and value cocreation, the article proposes an integrative view of how novel value cocreation can be enhanced in service innovations. Finally, we develop an agenda for future research, encouraging researchers and managers to plan service innovations systematically, deploying each archetype in value cocreation, and combining them within an integrative approach.

This article analyzes the effects of diversification and brand breadth on firm performance for professional service firms (PSFs). The research aim is two-fold. First, we test whether moving into products may put at risk the core resources that sustain PSFs' competitive advantage. Second, we study which branding strategies best match their diversification attempts. Broad (narrow) brands characterize a branding strategy with scarce (plentiful) associations to specific product characteristics. We analyzed trademark portfolios of 47 U.S.-based management consulting firms in the 2000 to 2009 time period. Panel regression results suggest that (1) PSFs always benefit from diversification when they remain pure-service providers; (2) performance is positively related to a strategy of specialized narrow brands.

We conduct a systematic exploratory investigation of the effects of firms' existing service productivity on the success of their new service innovations. Although previous research extensively addresses service productivity and service innovation, this is the first empirical study that bridges the gap between these two research streams and examines the links between the two concepts. Based on a comprehensive data set of new service introductions in a financial services market over a 14-year period, we empirically explore the relationship between a firm's existing service productivity and the firm's success in introducing new services to the market. The results unveil a fundamental service productivity-service innovation dilemma: Being productive in existing services increases a firm's willingness to innovate new services proactively but decreases the firm's capabilities of bringing these services to the market successfully. We provide specific insights into the mechanism underlying the complex relationship between a firm's productivity in existing services, its innovation proactivity, and its service innovation success. For managers, we not only unpack and elucidate this dilemma but also demonstrate that a focused customer scope and growth market conditions may enable firms to mitigate the dilemma and successfully pursue service productivity and service innovation simultaneously.

The Net Promoter Score (NPS) is, according to Reichheld, the single most reliable indicator of company growth, and many companies use this recommendation-based technique for measuring customer loyalty. Despite its widespread adoption by many companies across multiple industries, the debate about NPS goes on. A major concern is that managers treat NPS as being equivalent across customers, which is often very misleading. By using a unique data set that combines customers' promoter scores and online word-of-mouth (eWOM) behavior, this research studies how individual customers' promoter scores are related to eWOM, including its relationship with the three categories of customers that are identified by the NPS paradigm (i.e., promoters, passives, and detractors). Based on a sample of 189 customers, their promoter scores and corresponding eWOM, the results show that there is a positive relationship between customers' promoter scores and the valence of online messages. Further, while detractors and promoters are homogeneous with respect to the valence of the eWOM messages they spread, passives show message valence heterogeneity. Thus, although passives, the largest group of customers, have no weight in calculating the NPS, our results reveal that companies should flag passives for further attention and action.