Service recovery strategies for crowdsourced transportation: an examination of their impacts on user loyalty

Crowdsourced transportation (CT), which can be applied to passenger transportation and deliveries, is a growing business model, especially in modern societies. The service nature of CT which utilises public participation to provide transportation services makes it prone to service failures, which can cause users’ switching behaviour. Grounded on perceived justice and perceived value theories, the objectives of this study are to identify the service recovery strategies and to examine their impact on user loyalty (i.e. switching behaviour) after a service failure. In total, 549 survey responses were collected from CT users and analysed using structural equation modelling. Results show that five service recovery strategies can be employed by CT service platforms after a service failure, namely, ‘compensation’, ‘apology’, ‘problem solving’, ‘response speed’ and ‘explanation’. These strategies influence users’ perceived justice, which in turn influence user loyalty directly and indirectly via perceived value. The findings of this study have contributed to the development of a unified framework for service recovery in the context of CT and have several strategic management implications for CT service platforms to retain users.