Understanding the effects of a social media service failure apology: A comparative study of customers vs. potential customers

•The role of a service failure apology to current & potential customers is examined.•Attitudinal & behavioural effects of a social media apology are hypothesised.•The model predicts behavioural intentions of customers and non-customers.•Better targeting & audience control for a social media apology is necessary.•Managers need increase the behavioural intentions to become a customer. Service failure apologies on social media are a new crisis communication outlet trend used by companies to apologise to affected customers quickly and offer solutions, ultimately to restore customers' trust and brand loyalty. This paper contributes to the nascent literature on companies' social media service failure apologies and fills a gap in the social commerce literature by recognising that due to the open and public nature of social media, these apologies may reach not just affected customers, but also unintended audiences such as potential customers among the general public, which could potentially damage a company's reputation and market share. An online survey administered to 241 customers and 271 non-customers of a famous mobile phone brand, which used YouTube to apologise to its customers for a service failure incident, is used to explore potential behavioural outcomes, after exposure to the apology. Findings confirm that both customers and non-customers of the service provider may become exposed to a social media service failure apology. The hypothesised model predicts behavioural intentions to remain a customer after exposure to the social media service apology better than behavioural intentions to become a customer, even though relationships hold for both groups. Theoretical and managerial implications are discussed.