Abstract: The purpose of this paper is to introduce the perspective of potential customers into service recovery literature and explore the effect of online service recovery efforts on potential customers. This paper conducts an experiment using a 2×2×2 between-subject factorial design and uses questionaire to collect data, which are subsequently analyzed with structural equations modeling. The study finds that different elements of responses have different effects on potential customers’ dimensions of justice perception: (1) explanation adequacy has significant effects on both distributive and interpersonal justice, while (2) apology provision only has a significant effect on interpersonal justice. (3) Responder information disclosure has no significant effect on both distributive justice and interpersonal justice. For service recovery literature, this study provides a framework on the factors that influence potential consumers’ trusting belief from a justice perspective, and extends the literature to the online context. In practice, this study investigates the effects of firms’ service recovery efforts from the perspective of potential customers instead of the complainants, which provides a new perspective to design and examine firm’s service recovery approaches in the online context. Practitioners shall respond to the negative online review by providing an adequate explanation of the service failure, as well as an apology, in order to better attract potential customers.

Key words: Trust, Perceived justice, Service recovery, Online review, Negative review, Potential customer