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What to do after a data breach? Examining apology and compensation as response strategies for health service providers

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  • Kristin Masuch

    (University of Goettingen)

  • Maike Greve

    (University of Goettingen)

  • Simon Trang

    (University of Goettingen)

Abstract

Innovative IT-enabled health services promise tremendous benefits for customers and service providers alike. Simultaneously, health services by nature process sensitive customer information, and data breaches have become an everyday phenomenon. The challenge that health service providers face is to find effective recovery strategies after data breaches to retain customer trust and loyalty. We theorize and investigate how two widely applied recovery actions (namely apology and compensation) affect customer reactions after a data breach in the specific context of fitness trackers. Drawing on expectation confirmation theory, we argue that the recovery actions derived from practice, apology, and compensation address the assimilation-contrast model’s tolerance range and, thus, always lead to satisfaction with the recovery strategy, which positively influences customers’ behavior. We employ an experimental investigation and collect data from fitness tracker users during a running event. In the end, we found substantial support for our research model. Health service providers should determine specific customer expectations and align their data breach recovery strategies accordingly.

Suggested Citation

  • Kristin Masuch & Maike Greve & Simon Trang, 2021. "What to do after a data breach? Examining apology and compensation as response strategies for health service providers," Electronic Markets, Springer;IIM University of St. Gallen, vol. 31(4), pages 829-848, December.
    • Handle: RePEc:spr:elmark:v:31:y:2021:i:4:d:10.1007_s12525-021-00490-3
    DOI: 10.1007/s12525-021-00490-3
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    References listed on IDEAS

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    Cited by:

    1. Edith Maier & Ulrich Reimer & Nilmini Wickramasinghe, 2021. "Digital healthcare services," Electronic Markets, Springer;IIM University of St. Gallen, vol. 31(4), pages 743-746, December.
    2. Uddin, Mohammad Rajib & Akter, Shahriar & Lee, Wai Jin Thomas, 2024. "Developing a data breach protection capability framework in retailing," International Journal of Production Economics, Elsevier, vol. 271(C).

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    More about this item

    Keywords

    Health data breach recovery action; Data breach response strategies; Compensation; Apology; Expectation confirmation theory; Assimilation-contrast model;
    All these keywords.

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior

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