A Bit(coin) of happiness after a failure: an empirical examination of the effectiveness of cryptocurrencies as an innovative recovery tool

Amin Nazifi, Samantha Murdy, Ben Marder, Jana Gäthke, Bardia Shabani

Research output: Contribution to journalArticlepeer-review

Abstract

This research provides the first examination of the effectiveness of cryptocurrencies as an innovative recovery tool. Through four experiments, we assess the effects of crypto-compensation against traditional compensation
types (voucher/cash) on customer recovery satisfaction. Study 1 findings indicate that crypto-compensation is more effective than voucher and cash in improving customer recovery satisfaction. Further, it shows that consumer
innovativeness moderates the effectiveness of crypto-compensation. After establishing the effectiveness of crypto-compensation, Study 2 finds a moderating effect of consumer choice in influencing crypto-compensation
effectiveness. Study 3 reveals the differential effect of communicating different crypto-compensation benefits on customer recovery satisfaction. Finally, Study 4 concludes that familiar cryptocurrencies (e.g., Bitcoin vs. EOS) best restore satisfaction after a failure and that compensation message framing (i.e., cryptocurrency monetary value vs. real nominal value) moderates this relationship. Theoretical and practical implications are discussed.
Original languageEnglish
Pages (from-to)494-505
Number of pages12
JournalJournal of Business Research
Volume124
Early online date16 Nov 2020
DOIs
Publication statusPublished - 5 Jan 2021

Keywords

  • service recovery
  • compensation 2.0
  • cryptocurrency
  • customer satisfaction
  • prospect theory

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