Examining online reviews and ratings by B2C and B2B customers: do digital service failure type and customer experience matter?

Purpose The remarkable growth of digital services has been marred by widespread failures faced by users and the subsequent fallouts for these firms. Despite the enormous negative impact of these digital service failures on the firms as well as the customers, limited attention has been paid to investigating their consequences. This study addresses this gap. This study aims to examine the impact of these digital service failures faced by B2C and B2B customers – segments with varying consumption goals, on online reviews and ratings posted by them. Importantly, it maps the role of “cognitive” and “affective” customer experience dimensions, in these relationships. Design/methodology/approach The context chosen for the study was mobile payments, where service failures can be critical. The study involved scraping review data from a widely used mobile payment application in an emerging market, India, to obtain data from B2C customers (n = 22,771 observations in the B2C G Pay app) and B2B customers (n = 1,008 observations in the B2B G Pay app). The proposed hypotheses were tested through structural equation modeling. Findings Functional, service, system and information failures led to negative ratings and reviews for B2C customers, and these relationships are mediated by negative affect and cognitive experience dimensions, for functional, service and information failures. In contrast, for B2B customers, only service and functional failures significantly predict negative reviews and ratings. However, the mediating mechanism was found only for the relationship between service failure and ratings in the B2B segment. Research limitations/implications As the study relies on data from one application in a single digital service i.e. mobile payment service, future research could extend this work by examining multiple applications across different digital services. Practical implications Managers may monitor all types of failures for B2C customers to avoid negative customer experiences and subsequent firm outcomes. For B2B customers, attention should be paid primarily to functional and service failures. Originality/value Our research adds to the growing literature on digital services by studying the effects of digital service failures on online ratings through the mediating roles of negative affect and cognitive experiences. Uniquely, our work considers both (B2C and B2B) customer segments’ responses to digital service failures.