ABSTRACT
One relevant quote
What happens when customers lie?
Research/case problem
What happens when a service has not failed and customers misbehave, fraudulently claiming compensation.
Case Synopsis
Service recovery and reinstatement of customer satisfaction after a service has failed that have been studied in different industries. Best practice in the management of service recovery exists within the tourism industry, where a wide range of responses are used to repair the damage caused. What however happens when the service has not failed, and customers fraudulently claim this compensation? In other words, what happens when customers lie?
This chapter examines the false claims made by British tourists against Spanish hotels, more generally known as the “holiday sickness scam” as customers claimed to be suffering from food poisoning as a result of their stay at the hotel in order to claim undue compensation. The study adopts the business ecosystem to identify the role of different players in the scam at three key stages. First, it traces the origins of the scam back to 2015 when an increase in claims was first identified, and highlights the role of a previously unimportant actor in the ecosystem, the claims management companies who encouraged British customers to make fraudulent claims. Second, it identifies the financial and reputational impact on the Spanish tourism industry in 2016 at the height of the scam when resorts experienced an unprecedented increase in customer claims. Finally, it identifies how the industry worked with distant ecosystem members from 2017 to resolve the issue (e.g. the European Commission and the Spanish and UK Governments).
This case serves to stimulate discussion on socially responsible consumers by addressing the converse – misbehaving customers. It identifies the role of the firm in changing consumer behaviour from unsocially responsible to socially responsible by examining the effectiveness of existing business practices and demonstrating the benefits of adopting a business ecosystem approach.
