Barnes & Noble, Kohl’s, and Marriott Top Customer Service Ratings

In a new report called Rating Customer Service Experiences, 2010, I analyzed how 4,600+ US consumers rated their customer service experiences with 92 large companies across 14 industries. Led by Barnes & Noble, Kohl’s, and Marriott, 24 companies received a Net Satisfaction Score* of 80% or higher.

At the other end of the spectrum, 10 firms had Net Satisfaction Scores below 50%: Charter Communications, Comcast, Washington Mutual, United Healthcare, Aetna, Citigroup, AOL, HSBC, Bank of America, and Capital One.

The absolute scores tell only a part of the story. We also compared the customer service rating for each company with the average for its industry. It turns out that credit unions, Kaiser, and Apple led 25 firms that were five or more percentage points above their peers.

At the other end of the spectrum, 11 firms fell more than 10 percentage points below their industry average: Washington Mutual, Charter Communications, Bank of America, Citigroup, HSBC, United Healthcare, JP Morgan Chase, Aetna, Capital One, United Airlines, and Office Depot.

I also examined the ratings given by different generations of consumers. In 10 of the 14 industries, Seniors were the most satisfied with customer service. For nine of the industries, Gen Y were the least satisfied.

*Net Satisfaction Score: We asked consumers to rate their customer service experiences on a 5-point satisfaction scale. To create the Net Satisfaction Score, we took the percentage of consumers who gave the company a “4” or “5” and subtracted the percentage of consumers that gave the company a “1” or “2.”

The bottom line: Focus on customer service in 2010.

Credit Unions And SunTrust Lead Banks In Customer Experience

Forrester’s 2010 Customer Experience Index (CxPi) ranks 133 firms across 14 industries. I recently published the bank analysis which examines the 13 banks in the CxPi. Here are the overall results:

As a group, the banks were in the middle of the pack of industries with an “okay” average rating of 66%. But banks had the largest drop of any industry, down five percentage points from the 2008 CxPi. Here are some insights from looking at the banking results:

  • The best bank customer experience. Credit unions and SunTrust Bank up well above the other 11 banks on the list.
  • The worst bank customer experience. At the bottom of the list, three banks ended up with “very poor” ratings: Washington Mutual, Bank of America, and Capital One.
  • Most banks declined. Of the 11 banks that were also ranked in 2008, only three of them improved: SunTrust Bank, Wachovia, and U.S. Bancorp. Going in the other direction, Bank of America, Washington Mutual, and Wells Fargo had double-digit declines.
  • Capital One and Bank Of America and Citibank aren’t enjoyable. The CxPi has three underlying components: 1) meeting needs, 2) being easy to work with, and 3) enjoyability. Three banks tied for the bottom of the “enjoyability” ratings: Bank of America, Capital One, and Citibank.

The bottom line: Banks headed in the wrong direction in 2009

Retailers Lead, TV Service Providers Lag In Loyalty

I just published research called How Loyal Are Consumers? Not Very that examines the loyalty that consumers have with 113 large firms across 12 industries: airlines, banks, cell phone service providers, credit card providers, hotels, insurance firms, Internet service providers, investment firms, medical insurance companies, PC manufacturers, retailers, and TV service providers.

We asked 4,500+ US consumers about three areas of loyalty:

  1. Willingness to consider the provider for another purchase
  2. Reluctance to switch business away from the provider
  3. Likelihood to recommend the provider to a friend or colleague

Here are some of the industry-level findings (in terms of the percentage of loyal customers):

  • Willingness-to-repurchase
    • Leaders: Retailers (89%) and Insurers (82%)
    • Laggards: TV Service Providers (69%) and ISPs (73%)
  • Reluctance-to-switch 
    • Leaders: Retailers (80%) and Investment Firms (73%)
    • Laggards: Airlines (62%) and TV Service Providers (63%) 
  • Likelihood-to-recommend 
    • Leaders: Retailers (81%) and Insurers (75%)
    • Laggards: TV Service Providers (59%) and Health Plans (60%)

Here are some of the company findings (ranked relative to their industry averages): 

  • Willingness-to-repurchase
    • Leaders: USAA credit cards (+24%), Southwest Airlines (+13%), and credit unions banking (+13%) 
    • Laggards: US Airways (-18%), Sprint (-16%), and RadioShack (-13%)
  • Reluctance-to-switch 
    • Leaders: USAA credit cards (+20%), Apple (+19%), and Hampton Inn (+18%)
    • Laggards: US Airways (-18%), Sprint (-16%), RadioShack (-15%), and Washington Mutual banking (-15%)
  • Likelihood-to-recommend 
    • Leaders: USAA credit cards (+26%), Kaiser (+17%), and Southwest Airlines (+17%)
    • Laggards: US Airways (-18%), Compaq (-17%), and RadioShack (-16%)

The bottom line: What are you doing to make your customers more loyal?

USAA Sets The Standard In Credit Card Experiences

In Forrester’s 2008 Customer Experience Index (CxPi), we ranked 113 companies across 12 industries. I recently published a snapshot of the credit card industry results from 10 firms: American Express, Bank of America, Capital One, Chase, Citigroup, Discover, HSBC, USAA, Washington Mutual, and Wells Fargo. Here are some highlights of the results:

  • Experiences are “okay.” As a group, the 10 credit card issuers ended up with an “okay” rating of 68%, a small increase over the 2007 CxPi results.
  • USAA stands apart in the industry. With an “excellent” rating of 91%, USAA easily outpaced the other firms and ended up #2 in the overall rankings. The second firm on the credit card list, American Express, was 12 percentage points back with a “good” rating and Discover was the only other provider with a “good” rating.
  • HSBC came out at the bottom. With a “very poor” rating of 54%, HSBC came out at the bottom of the list. Two firms ended up with “poor” ratings: Washington Mutual and Bank of America.
  • USAA dominated all categories. USAA came out on top in all three components of the CxPi, with the largest lead in enjoyability. American Express earned “excellent” ratings for meeting user needs and being easy to work with.
  • Washington Mutual dropped the most. When we compared results for nine of the firms that were in the 2007 CxPi, Washington Mutual ended up having the largest decline (9 percentage points). HSBC wasn’t far behind; falling 8 points. Capital One and Discover made the largest gains; both increased by 4 percentage points.

The bottom line: Credit card providers need to learn a lot from USAA.

Surprise! Banks Got Better At Customer Experience

In Forrester’s Customer Experience Index (CxPi), we ranked 114 companies across 12 different industries. As part of that research stream, I am publishing reports on each of the industries. The first one published is a snapshot of the banking industry results. It turns out that banks, as a group, made the largest improvement of any of the 12 industries. And they needed it!

In June 2007, I write a report called Banks Prepare For Customer Experience Wars. After a decade of focusing on mergers and acquisition as their strategy for growth, big banks were beginning to concentrate on organic growth. To succeed, they needed to improve the experiences they deliver to existing customers. Why? My research uncovered a very strong correlation between customer experience and loyalty.

Here are some of the highlights of the banking results:

  • Banks really improved. In last year’s CxPi, banks ended in 6th place out of nine industries. This year, banks had the highest increase in average score (+7%) and ended up in 4th place out of 12 industries — only falling behind retailers, hotels, and insurers.
  • Credit unions lead. With the only overall “excellent” rating, credit unions easily topped the list of banks in the CxPi – taking the top spot for the second year in a row. Next in line was National City which was the only bank to receive a “good” rating.
  • JPMorgan Chase lags. JP Morgan Chase ended at the bottom of the list with a rating of “poor” – taking over the bottom spot from last year’s cellar dweller Citibank.
  • SunTrust and National City shine in some areas. Credit unions were at the top of the list for all three components  of the CxPi. For usefulness, SunTrust received the second highest score and Washington Mutual fell to the bottom. For ease of use, National City and Wells Fargo were ranked second and third, while JPMorgan was ranked last. For enjoyability, Citibank, Capital One, and JPMorgan Chase all received “very poor” ratings.
  • U.S. Bancorp leads the improvement bandwagon. U.S. Bancorp made the most headway of any bank (+18%). SunTrust Bank and Citibank also had double-digit improvements in CxPi. Wachovia Bank, on the other hand, was the only bank with an overall decline in its CxPi.

The bottom line: Kudos to banks for improving; hopefull they’ll keep it up.

Citibank And JPMorgan Chase Face Customer Experience Crossroads

It’s been quite a week in the banking industry. Washington Mutual was sold to JPMorgan Chase and there’s talk of Wachovia merging with Citibank. From a customer experience perspective, it doesn’t look good. Why not?

In Forrester’s Customer Experience Index, we ranked 14 banks. The bottom 2 on the list were Citibank and JPMorgan Chase. Wachovia was fourth and Washington Mutual was eighth. If we assume that the acquiring company will set the prevailing tone, then that’s a big loss for customer experience. Making matters worse, the integration of large organizations tends to make people become very internally focussed as they try to merge systems, products, organizations, and processes.

My take: The advice that I gave in my previous post called Two Words For Vikram Pandit (Citigroup CEO): “Customer Experience” is even more important than ever, for both Vikram Pandit and Jamie Dimon (JPMorgan Chase CEO). Since we know that customer experience highly correlates to loyalty in banking, these CEOs should make customer experience a key tenet of the integration. Without a keen focus in this area, customer experience will likely get worse.

The CEOs shouldn’t just push for minimal customer disruptions, I’d like to see them strive for customer experience excellence. But this type of bold move will take leadership. It will take an ongoing commitment from the CEOs to maintain the focus on customer experience, and very strong Chief Customer Officers to chart and guide the transformation.

Both big banks will need to go through the five stages of maturity that I defined in my research on the customer experience journey:

The bottom line: Only strong leadership can convert customer experience from a liability to an asset.

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