Does ethnocentrism work? Evaluating the effect of airlines service recovery strategies on airline brand equity

The study aims to investigate how corporate social responsibility (CSR), service recovery effort, severity of service failure, and ethnocentrism affect service recovery satisfaction and airline brand equity among Malaysia Airlines passengers. Additionally, it explores how ethnocentrism moderates these effects. Using an airport intercept survey, the researchers surveyed 308 passengers from state-owned Malaysia Airlines who had experienced service failure and recovery. They then analyzed the data with PLS-SEM. The results showed that CSR and service recovery efforts significantly influenced service recovery satisfaction. Additionally, CSR, service recovery satisfaction and customer ethnocentrism significantly affected airline brand equity. Service failure severity does not significantly influence service recovery satisfaction, and customer ethnocentrism does not moderate the relationship between service failure severity and service recovery satisfaction. The empirical insights provide valuable information for policymakers and managers in the airline sector of developing countries, especially those managing state-owned airlines. The study clarifies the complexities of the relationship between service recovery efforts and brand equity and fills a gap in the literature by demonstrating the negative consequences of inadequately addressed service failures during service recovery efforts.