Advantage Rent A Car and USAA Lead in 2013 Temkin Forgiveness Ratings

All companies, even customer experience leaders, make mistakes. But how much goodwill have companies built up for consumers to forgive them after those miscues? To answer this question, Temkin Group surveyed 10,000 U.S. consumers about companies with whom they’ve recently interacted. We used this data for the third annual Temkin Forgiveness Ratings of 246 companies across 19 industries.

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Company Results

Here are the highlights of the 246 companies in the 2013 Temkin Forgiveness Ratings:

• Advantage earns top spot. With an excellent score of 61%, Advantage earned the highest rating.
• USAA dominates forgiveness. USAA grabbed the next three spots for its banking, insurance, and credit card businesses.
• The rest of the top 10. H.E.B., Blackboard, Aldi, Alaska Airlines, credit unions and Publix round out the top 10
• No industry owns the top. The top 25 companies in the ratings comes form a variety of industries: Four grocery chains, three airlines, three retailers, two banks, two hotel chains, two investment firms, two software firms, one appliance maker, one auto dealer, one credit card issuer, one fast food chain, one health plan, one insurance carrier, and one rental car agency.
• HSBC dominates the bottom. HSBC earned the bottom two spots in the ratings for its credit card and banking businesses.
• Many TV service providers are at the bottom. Six of the bottom 12 companies are TV service providers: Cox Communications, Time Warner Cable, Comcast, Verizon, Charter Communications, and Optimum (iO)/Cablevision.
• USAA most outperforms its peers. We compared company ratings with their industry averages and USAA came in the top three spots, 36 points above in banking, 31 points ahead in credit cards, and 28 points ahead in insurance. Three other companies are more than 20 points above their industry averages: Advantage (car rentals), credit unions (banking), and TriCare (health plans).
• HSBC most underperforms. HSBC fell the farthest below its industry average in two areas, 23 points behind its peers in banking and credit cards. Five other companies had scores that were 15 points and more below their industry: US Airways (airlines), Motel 6 (hotels), McAfee (software), Kia (auto dealers), and Hertz (rental cars).

We also examined year-over-year results for 204 companies that were in both the 2012 and 2013 Temkin Forgiveness Ratings. Here are some highlights of that analysis:

• Chrysler improves the most. With a jump of 29 percentage points, Chrysler is the most improved company.  Six other companies gained 20 points or more: Continental Airlines, Citigroup, Avis, EarthLink, Ameriprise Financial, and Alaska Airlines.
• US Cellular declines the most. With a drop of nearly 20 percentage points, US Cellular dropped the most in 2013.  Nine other companies fell by more than 10 points: Bright House Networks, HSBC, Cox Communications, Hertz, PNC, SunTrust Bank, Dollar Rental Car, Hyatt, and TD Ameritrade.

Industry Results

Here are the highlights of the 19 industries in the 2013 Temkin Forgiveness Ratings:

• TV service providers are unforgivable. TV service providers, as an industry, earned the lowest Temkin Forgiveness Rating of 12%. It was five points below Internet service providers and seven points below wireless carriers.
• Grocery chains are the most forgivable.  With an average rating of 39%, grocery chains are the highest scoring industry. Three industries are just four points behind: hotel chains, auto dealers, and rental car agencies.
• Credit cards make the most improvements. Credit cards made the largest improvement, nine percentage points, over the previous year.  Auto dealers, rental car agencies, and airlines also improved by more than five points.
• TV service providers head in the wrong direction. Led by TV service providers that dropped three points between 2012 and 2013, three industries earned lower scores in 2012. The other industries are retailers and appliance makers.

Calculating the Temkin Forgiveness Ratings

During January 2013, Temkin Group asked consumers to identify companies that they have interacted with during the previous 60 days.  For a random subset of those companies, consumers are asked to rate companies as follows:

How likely are you to forgive these companies if they deliver a bad experience?
Responses from 1= “extremely unlikely” to 7= “extremely likely”

For all companies with 100 or more consumer responses, we calculated the “net forgiveness” score. The Temkin Forgiveness Ratings are calculated by taking the percentage of consumers that selected either “6” or “7” and subtracting the percentage of consumers that selected either “1,” “2,” or “3.”

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To see all of the companies in the Temkin Forgiveness Ratings as ell as all of our other Temkin Ratings and sort through the results, visit the Temkin Ratings website

The bottom line: Forgiveness is an asset that you accumulate by consistently meeting customer needs.

TracFone and Verizon Wireless Lead Wireless Industry in 2013 Temkin Experience Ratings

We recently released the 2013 Temkin Experience Ratings that ranks the customer experience of 246 companies across 19 industries based on a survey of 10,000 U.S. consumers. Here are highlights from the wireless industry:

• On average, the wireless industry showed a slight decrease from 60.3% in 2012 to 59.9% this year, earning the sector a “poor” rating.
• The top company in the industry, TracFone, is only #115 overall, but its rating of 66% is four points above second place Verizon Wireless. This is the third straight year that TracFone has led the industry.
• Three wireless companies earned “poor” ratings: AT&T (59%), Sprint (58%), and T-Mobile (56%). This is the second straight year that T-Mobile has been in last place in the industry.
• AT&T and Sprint are the only two wireless carriers with decreases in their ratings between 2012 and 2013.
• TracFone leads in the functional component of the ratings and Verizon Wireless leads in the accessible component.
• MetroPCS has a very unique profile; it leads in the emotional component, but is the lowest scoring in the accessible component.
• T-Mobile is the lowest rated in both the functional and emotional components
• Here’s a link to industry results from the 2012 ratings.

Download entire dataset for $395

Report: 2013 Temkin Experience Ratings

We published the 2013 Temkin Experience Ratings. The report analyzes feedback from 10,000 U.S. consumers to rate 246 organizations across 19 industries. Congratulations to the top firms in this year’s ratings: Publix, Trader Joe’s, Aldi, Chick-fil-A, Amazon.com, and Sam’s Club.

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You can also download the data for $395.

The Temkin Experience Ratings are based on evaluating three elements of experience:

1. Functional: How well do experiences meet customers’ needs?
2. Accessible: How easy is it for customers to do what they want to do?
3. Emotional: How do customers feel about the experiences?

Here are the top and bottom companies in the ratings:

Here’s how the industries compare with each other:

(NOTE: We have published posts on the detailed results for all 19 industries)

Here are the companies that are leaders and laggards across the 19 industries:

In this year’s ratings, 37% of companies earned “good” or “excellent” scores, while 28% are rated as “poor” or ”very poor.” Companies with at least a “good” rating grew by nine-percentage points since 2012 and by 21-points since 2011. Of the 203 companies that are included in both the 2012 and 2013 Temkin Experience Ratings, 57% firms had at least a modest increase. The companies that made the largest improvement over 2012 are Citibank, TriCare, TD Ameritrade, Office Depot, EarthLink, Hardees, and Regions Bank.

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Get the Data

Do you want to see all of the data? You can purchase an excel spreadsheet for $395…

To view all of our ratings (experience, loyalty, trust, forgiveness, customer service, and web experience), visit the Temkin Ratings website…

The bottom line: Customer experience is improving, but there’s still a long way to go

Companies Don’t Earn The Loyalty Their CX Deserves

Our report The ROI of Customer Experience shows that customer experience is highly correlated to loyalty. The research analyzed the relationship between Temkin Loyalty Ratings and Temkin Experience Ratings (TER) for 206 U.S. companies.

After analyzing the connection between these ratings, we found that some companies seem to have higher loyalty levels than they seem to deserve based on their customer experience while others have lower loyalty levels.

Using that dataset, I compared actual loyalty levels with projected loyalty levels. How? By plugging each company’s experience rating into our regression model to identify what their loyalty rating should be (normalized to their industry average) based on its TER and compared that projected rating with its actual loyalty rating. In the chart below you can see the companies with the largest positive and negative variances from the model’s projections.

The companies with loyalty levels the most above the projections are USAA, Highmark, Medicaid, credit unions, and TriCare. The companies that fall the most below the projections are T-Mobile, BMW, Bosch, AT&T, and Alamo.

Let’s examine USAA as an example. Since it has very high experience ratings compared with its industry peers, our model projects that its loyalty ratings should be at the high end of banks, credit card issuers, and insurance carriers. This analysis shows that USAA’s actual loyalty levels are higher than expected, even after factoring in its wonderful customer experience.

So what?!? There’s nothing inherently good or bad with being above or below the projected loyalty level. There’s no reason to expect companies to fall directly on their projected loyalty levels.

What’s interesting about this analysis is not what’s good or bad, but WHY are some companies so far away from the projected levels. This is where I’ll leave the data behind and offer my interpretation about WHY some companies have higher than projected loyalty while others have lower than projected loyalty:

• Product fit. CX is not the only component of customer value. Companies that have tailored their products and services to better meet customers’needs (like USAA and TriCare) have an even better loyalty level than their CX would suggest. If companies have a poor product offering, then their loyalty may be lower than projected (this may explain Sears and DHL).
• Product quality. If companies have quality problems with their offerings, then they would have lower loyalty levels than their CX deserve (this may explain AT&T, T-Mobile, and Alamo).
• Service expectations. Companies that have premium status (BMW cars and Bosch appliances) often elicit higher expectations from customers, so they don’t earn the loyalty that their CX would suggest and have to work harder.
• Trapped customers. In industries where customers have a hard time switching, a bad experience may not lead to the loyalty decline anticipated by the model; the same type of situation would occur if a company is harder to move away from than it’s competitors (this may explain Medicaid, Medicare, MSN, and EarthLink).
• Commoditization. In industries that have a lot of pricing comparisons, customers may overly focus on price and not award good customer experience with the level of loyalty that the model projects (this may explain Alamo). It can also push consumers that have poor experience to more quickly leave a company for its competitor (this may explain DHL).
• Substitutions. In sitations where customers don’t have a lot of clear alternatives, they will be more loyal to a company than the model suggests (this may explain eBay). A company that relies on self-service may be seen as easier to move from than a company that forms more personal connections with customers (this may explain E*TRADE).
• Emotionality. Sometimes customers develop a strong affinity for a brand that increases loyalty and dampens the negative effect of any poor experiences (this may explain Southwest Airlines and Apple).

These items cover three broad topics: offerings, competitive environment and customer expectations. What do you think causes companies to earn more or less loyalty than their customer experience seems to deserve?

The bottom line: CX is correlated to loyalty, but other things matter as well

Report: Net Promoter Score Benchmark Study, 2012

We just published a Temkin Group report, Net Promoter Score Benchmark Study, 2012. It provides NPS data on 180 U.S. companies across 19 industries. Here’s the executive summary:

USAA took the top two spots for its banking and insurance businesses while HSBC came in at the bottom for banking and credit cards. Our analysis of differences across consumer demographic segments showed that NPS tends to go up with age, doesn’t vary much by income levels, and is often highest with Asians. We also asked consumers what would make them more likely to recommend the companies and found that promoters are more likely to select lower prices and detractors are more likely to select better customer service. While there is some debate about the efficacy of NPS, our analysis shows that promoters are much more likely than detractors to purchase more in the future across all industries. To help you implement a successful NPS program, we’ve included eight tips such as don’t believe in an “ultimate question” and use control charts, not pinpointed goals.

Download report for $295
(includes the data)

The industries included in this report are airlines, auto dealers, banks, computer makers, credit card issuers, fast food chains, grocery chains, health plans, hotel chains, insurance carriers, Internet service providers, investment firms, major appliance makers, parcel delivery services, rental car agencies, retailers, software firms, TV service providers, and wireless carriers.

The report contains the following components:

• NPS for 180 companies across 19 industries
• NPS differences based on age, income, and ethnicity of consumers
• Improvement areas selected by promoters and detractors by industry
• Connection between NPS and future purchases by industry
• Eight tips for implementing a successful NPS program

Download report for $295
(Includes the data)

The bottom line:  Companies need to give customers a reason to recommend them

2012 Temkin Web Experience Ratings

Temkin Group has just released the 2012
We introduced the Temkin Web Experience Ratings last year. The 2012 Web Experience Ratings include 159 companies from 18 industries and is based on a survey of 10,000 U.S. consumers.

Congratulations to the top firms in this year’s ratings: Amazon, credit unions, USAA, PNC, Southwest Airlines, eBay, Sam’s Club, ShopRite, JCPenney, and ING Direct. Of course, not every company has earned good web experience, especially the companies at the bottom of the 2012 ratings:  Charter Communications, Humana, Qwest, Cigna, Time Warner Cable, Anthem, Road Runner, Medicare, Blue Shield of CA, and TracFone.

We also  examined industry averages and found that banks and investment firms have earned the highest Temkin Web Experience Ratings followed by hotel chains and retailers. But consumers gave very low ratings to Internet service providers, health plans, and TV service providers.

The research also examines how individual companies are rated relative to their industry peers. The following 11 firms outscored their industry average Temkin Web Experience Ratings by 10 percentage points or more: Kaiser Permanente, Amazon, ShopRite, Southwest Airlines, USAA, Starbucks, H.E.B., Publix, credit unions, Marriott, and Apple.

The following 15 companies fell 10 percentage points or more below their industry averages: Wells Fargo Advisors, AAA, Charter Communications, Delta Airlines, Citibank, Bank of America, Humana, TracFone, Qwest, Old Navy, U.S. Airways, Rite Aid, Kohl’s, Kmart, and Charter Communications.

Temkin Group also analyzed changes from the 2011 Temkin Web Experience Ratings. Led by TV service providers and insurance carriers 11 of the 12 industries that were in both the 2011 and 2012 ratings improved since last year.

Seventy-two percent of companies that were in the 2011 and 2012 Temkin Web Experience Ratings showed improvement. Led by Comcast (Internet and TV service), Allstate, AOL, Charter Communications, Toshiba, and Sam’s Club, 20 companies improved by 10 percentage points or more between 2011 and 2012. Only three companies­— Kohl’s, TracFone, and Rite Aid—declined by 10 percentage points or more during that timeframe.

Do you want to see the data? Go to the Temkin Ratings website where you can sort through all of the results for free. You can even purchase the underlying data if you want to get more access.

The bottom line: Web experience is not good enough for how important it is

TracFone Tops Customer Experience Ratings of Wireless Carriers

This post examines the seven wireless carriers included in the 2012 Temkin Experience Ratings.

TracFone was the top rated carrier, but only received an “okay” rating. AT&T, Verizon Wireless, and Sprint also earned “okay” ratings while the remaining carriers were rated “poor.”

The average ratings for the wireless carriers placed it 13th out of 18 industries in the study. Temkin Group also analyzed the changes between 2011 and 2012 and found that customer experience in the wireless industry improved over the previous year. Led by Virgin Mobile and TracFone, all six carriers that were in both the 2011 and 2012 Temkin Experience Ratings had improved ratings. Sprint fell behind the other carriers with only a very slight improvement since last year.

Other highlights from the research include:

• TracFone and Verizon Wireless received the highest Functional ratings, while T-Mobile received the lowest. Virgin Mobile had the largest increase in this area while Sprint had the largest decline.
• TracFone and Verizon Wireless received the highest Accessible ratings, while Virgin Mobile and T-Mobile received the lowest. TracFone had the largest increase in this area while T-Mobile had the largest decline.
• TracFone received the highest Emotional ratings, while T-Mobile and US Cellular received the lowest. Virgin Mobile had the largest increase in this area while T-Mobile had the smallest.

Do you want to see the data? Go to the Temkin Ratings website where you can sort through all of the results for free. You can even purchase the underlying data if you want to get more access.

The bottom line: Wireless carriers have improved, but they have a long way to go in CX

Report: 2012 Temkin Experience Ratings UK

I’m excited to announce the launch of Temkin Group’s newest offering….

We introduced the Temkin Ratings site in the US last year. The site provides free access to all of our ratings, making it easy to see how consumers rate large companies across a number of dimensions. We decided to extend the Temkin Ratings into the UK with four of our ratings: Experience, Loyalty, Trust, and Forgiveness. You can review all of those ratings from the Temkin Ratings UK site.

As you can see below, we’re also providing the Temkin Experience Ratings report free of charge. We will providing some details around the other ratings in future posts. And, of course, we will be releasing the 2012 ratings in the US later this year — with even more industries.

We just published a new Temkin Group report, 2012 Temkin Experience Ratings UK. Congratulations to the top six companies (out of 66 in the ratings):

1) John Lewis
1) Waitrose
3) Amazon.co.uk
4) Farmfoods
4) Iceland
4) Morrisons

Here is the executive summary from the report:

John Lewis and Waitrose tied for first in the 2012 Temkin Experience Rankings UK, with several other grocery stores and Amazon.com rounding out the top ten. We asked 3,000 British consumers to rate their recent interactions with companies across three dimensions of their experience: functional, accessible, and emotional. These data allowed us to rate 66 companies across seven industries. Only two of those companies received an “excellent” rating, while 26% fell in the “good” category. The results show that retailers and grocery stores deliver the best experience while personal computer manufacturers and insurance companies provide the worst.

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The Temkin Experience Ratings UK are based on evaluating three elements of experience:

1. Functional: How well do experiences meet consumers’ needs?
2. Accessible: How easy is it for consumers to do what they want to do?
3. Emotional: How do consumers feel about the experiences?

Here are the ratings for all 66 companies:

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Are you interested in getting a deeper look at the data? Or do you want to see the differences in industries across age? Then you should visit Temkin Ratings at www.temkinratings.co.uk.

The bottom line: Customer experience excellence is in short supply.

T-Mobile Loses Customers, No Surprise

T-Mobile just announced that it lost a record number of customers in the first three months of the year. Is that a surprise? No. That’s the fate of most companies that provide subpar customer experience. T-Mobile was rated 114th out of 143 companies in the 2011 Temkin Experience Ratings. And, it was the next to last wireless carrier, only beating out Virgin Mobile.

The place where T-Mobile falls behind the most is in its Functional Experience, meeting customers’ basic needs:

With these types of ratings, T-Mobile needs to go through a systematic overhaul of its customer experience effort. It will take a multi-year journey similar to Sprint’s; changing operational processes and culture. T-Mobile will needs to improve in all four customer experience competency areas.

The ratings don’t look too good for Virgin Mobile either.

The bottom line: You can’t expect loyalty if you don’t provide consistently good experiences

TracFone Leads In (Poor Group Of) Wireless Experiences

In the 2011 Temkin Experience Ratings, we examined the customer experience across 12 industries. For this post, we will take a closer look at the six wireless carriers in the ratings.

Wireless carriers have an average rating of “Poor” and was the 8th ranked industry out of 12…

Let’s take closer look at the results for all of the individual wireless carriers…

As you can see, TracFone, Sprint, and AT&T barely cross into the “Okay” customer experience rating. The remaining three carrriers, Verizon Wireless, T-Mobile, and Virgin Mobile are in the “Poor” range.

Let’s take a look at the three components of the Temkin Experience Ratings…

TracFone is the top-performing carrier when it comes to functional and emotional experience, but falls behind four other carriers in the accessible component. While none of the carriers crossed the line of goodness for the accessible component of our ratings, Sprint comes out as the easiest to do business with. Virgin Mobile takes the bottom spot for both emotional and accessible components and T-Mobile falls well behind the other carriers in its functional experience.

The bottom line: Wireless carriers need to deliver better experiences

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