Examining the penalty resolution process: Building loyalty through gratitude and fairness

This project examines pricing issues in the service industry. In this research, we examine consumers’ responses to price penalties (e.g., late payment fees, restocking fee, cancelation fees etc.). We examine factors that make some penalties fair but others unfair. More importantly, we bring customer-service provider interactions into our model and examine the effect on long-term customer relationship building. We conducted multiple studies. The paper was sent to Journal of Retailing and received a reject and resubmit. We conducted an additional study and are preparing for resubmission (with Monika Kukar-Kinney at University of Richmond).