This article aims to investigate how service providers are employing their channels to support the handling of customer complaints in an online to offline era. It provides a timely contribution by characterizing multichannel recovery practices, discussing its implications for customers, and discovering new trends. The study employs a qualitative multi-method research, which includes not only more than one method of collecting data, but also more than one method of analyzing data. Data collection involved 50 records of customer complaints, 10 semistructured interviews, direct observation and internal bank reports. The results suggest that multichannel customers are not willing to interact with a large number of channels to solve their problems leading to a high number of interactions. Customers expect a complex recovery not in terms of interactivity but in terms of depth. Recovery solutions, such as apologizing and monetary compensations are non-permanent solutions, are inefficient in the long term and imply financial losses. Despite the investment that is required, this investigation advocates for permanent solutions. To avoid service failures and complex recovery processes, it is possible that companies are improving their operations management in search of new strategies that are blurring the boundaries of O2O into a mix of offline and online channels (O2).

Introduction

The emergence of Internet and new technologies has changed the foundations of service interactions, as we have witnessed a strong growth of services provided through multiple channels (Sousa and Voss, 2006). Financial services have pioneered many of these advancements, when banks established the first automated teller machines (Dabholkar, 1996), followed by online and mobile banking (Hoehle et al., 2012; Proença and Rodrigues, 2011) where no personal contact is required between buyer and seller (Meuter et al., 2000). The use of multichannel strategies to reach customers is now the norm rather than the exception (Kim et al., 2005; Webb and Lambe, 2007). As the O2O (i.e., offline to online or online to offline) mode has gained popularity in recent years, an increasing number of single-channel retailers are transforming themselves into multichannel retailers (Wang et al., 2016). For instance, an increasing number of consumers search and book products/ services online first, and, then, consume them in brick-and-mortar stores (Xiao and Dong, 2015). While companies are struggling to consistently maintain high service standards through all channels, service delivery systems are not foolproof, and, thus, service failures are inevitable (Hart et al., 1990). Managers have to focus on maintaining high standards of service delivery, but they must also be prepared to counteract service failures with effective service recovery processes (Shapiro and Nieman-Gonder, 2006). Service failure and recovery has been considerably studied in the last two decades. Despite the insights gained and the consensus reached, however, we still have a somewhat limited understanding of the topic (Holloway et al., 2009).