Customer Satisfaction

Consumer reviews are important to online shoppers. So, are more people participating now?

Phillip Nones Branding, Business, Content Creation and Content Management, Marketing, Marketing Communications, Marketing Research, Media, Sales, Social Commentary, Social Media , , , , , ,

Based on new research, the time-honored “90-9-1 rule” may no longer be accurate.

The 90-9-1 rule states that for every 100 people active online, one person creates content … nine people respond to created content … and 90 are merely lurkers – consuming the information but not “engaging” with it at all.

But now we have a survey by ratings and reviews platform Clutch which suggests that the ratio may be changing. The Clutch survey finds that around 20% of online shoppers have written reviews for some of their purchases.

That finding would seem to indicate that more people are now involved in content engagement than before. Still, when just one in five shoppers are writing and posting customer reviews, it continues to represent only a distinct minority of the market.

So, the big question for brands and e-commerce providers is how to encourage a greater number of people to post reviews, since such feedback is cited so often as one of the most important considerations for people who are weighing their choices when purchasing a new product or service.

A few of the ways that businesses have attempted to increase participation in customer reviews include:

  • Make the review process as efficient as possible by requesting specific feedback through star ratings.
  • Provide additional rating options on product/service performance sub-categories through quick guided questions.
  • Offering incentives such as a contest entry might also help gain more reviews, although the FTC does have regulations in place that prohibit offering explicit incentives in exchange for receiving favorable reviews.
  • Providing timely customer service – including resolving products with orders – can also increase the likelihood of garnering reviews that are positive rather than negative ones.

This last point is underscored by additional Clutch results which, when the survey asked why online shoppers write reviews, uncovered these reasons:

  • Was especially satisfied with the product or service: ~33%
  • Received an e-mail specifically requesting to leave feedback: ~23%
  • Was offered an incentive to leave feedback: ~5%
  • Was especially dissatisfied with the product or service: ~2%

For companies who might be concerned that negative feedback will be given lots of play, the 2% statistic above should come as some relief. And even if a negative review is published, the situation can often be rectified by reaching out to the reviewer and providing remedies to make things right, thereby “turning lemons into lemonade.”

After all, most consumers are pretty charitable if they sense that a company is making a good-faith effort to correct a perceived problem.

Antisocial behavior: Major retailers do much better broadcasting on social media than they do responding.

Phillip Nones Branding, Business, Content Creation and Content Management, Direct Marketing, Human Resources, Marketing Communications, Media, Media Consumption, Social Media , , , ,

untitledWhen it comes to social media, it turns out that the major U.S. retail brands are a lot better at dishing it out than consuming it.

On the “dishing out” side of the ledger, these retailers have been posting an ever-increasing number of social messages aimed at their target audiences.

A recent report from Sprout Social Index titled Snubbed on Social shows just how much:  In the 3rd Quarter of 2014, the average number of messages deployed by the typical major retailer was around 150, but in the 3rd Quarter of 2015, the number had grown to in excess of 350.

But what happens when these retailers are on the receiving end of social messages? Sprout Social has determined that the typical retailer receives around 1,500 inbound social messages over a busy quarter (such as during the holiday season).

Of these, approximately 40% of the messages are ones that warrant a response.

But only about 1 in 6 – fewer than 20% of them — actually get one.

And those consumers who are fortunate enough to receive a response are waiting approximately 12 hours to get it. That’s up from ~11 hours a year earlier.

One interesting factoid from the Sprout Social reporting is that customer messages on Twitter tend to get a better response from brands.

But it’s the difference between merely poor (~14% on Twitter) and downright embarrassing (~9% on Facebook).

untitledScott Brandt, chief marketing officer at Sprout Social, states it succinctly: “More often than not, brands are silent when their customers reach out.”

What are the implications of this (non-)behavior?

For one thing, interacting with customers helps drive more interesting and more purchases.  Sprout reports that consumers are seven times more likely to respond to social promotions and other social news if they have had meaningful interaction with the brand.

Obviously, ignoring the social messages that come through isn’t the way to build that engagement.

One dynamic that appears to be at work is that brands continue to use social media as a vehicle for broadcast messaging, whereas many consumers view social platforms as the place for a more conversational, two-way level of engagement.

You know – just like social media is supposed to work.

But there are some seemingly intractable reasons why it’s difficult to put the “theory” of social interaction into “practice.”

For starters, there are so many ways for people to communicate with companies and brands today (versus only by letter, phone or in person not that many years ago), that too many businesses are either stretched to thin or simply don’t feel the need to respond urgently if at all.

Another issue is similarly personnel-related. For brands to respond better would mean hiring and training people who possess the authorization to actually do something about a question or concern.  Low-level staff with low wages and benefits and with no authority to resolve issues is a clear ticket to nowhere.

At the very least, putting a process in place that provides a quick response to all inquiries – even if the initial response is auto-generated – is just plain common sense. The value to the consumer of a response that comes within just a few minutes – even if the message was posted in the dead of night – is what makes consumers bond with a brand.  (Just having their existence validated is huge for some people.)

Contrast that to the other, more common experience of brands ignoring their consumers to death … and where people never forget which companies aren’t good at responding to their questions or concerns. Does anyone think that reputation doesn’t have a dampening effect on sales?

More information about the Spout Social Index can be found here.

Customer Satisfaction: Going in the Wrong Direction?

Phillip Nones Branding, Business, Marketing Research , , , , , ,

The new American Customer Satisfaction Index report points to disappointing trends over the past year.

acsiAnother year has gone by — and with it the unsettling revelation that companies may be more talk than action when it comes to improving their customer satisfaction levels with customers.

The latest evidence of this comes from newly released ASCI (American Customer Satisfaction Index) figures. The data were compiled from results reported by ACSI in 2015 based on surveys conducted from Q4 2014 though Q3 2015.

What the ACSI report shows is that customer satisfaction is trending in the wrong direction. Of the 43 industries tracked by ASCI, only five of them registered an overall improvement in customer satisfaction score, while the other 38 declined or stayed the same.

The ASCI index includes more than 325 measures, with some companies represented in multiple industries where they hold substantial market share. Each company’s rating is based on a total possible high-score of 100.

Here’s the unpleasant bottom-line finding: In nearly 60% of the cases where year-over-year comparisons were possible, customer satisfaction scores have declined over the past year.

Where are the biggest problem areas? Perhaps not surprisingly, four of the five companies that experienced the largest declines in customer satisfaction were in the communications sector:   Comcast, AT&T, Cox Communications and Time Warner Cable.

ccComcast experienced a particularly bad result, with its ASCI score dropping ~10 percentage points to 54, tied for second-lowest among all companies included on the index. Cox Communications’ rating declined ~9 points to 58, and Time Warner Cable showed a similar percentage decline all the way down to a 51 score – the lowest rating recorded among all the companies on the index.

On the other hand, there were some bright spots in the latest ASCI report — and a lot of it has to do with Internet-based sectors.

Indeed, three of the five industries which charted overall improvements in customer satisfaction ratings are Internet-based, including Internet retail (up ~5 percentage points to an index of 81, the highest total achieved by any of the industries categories).

Other industries that exhibited an improvement in customer satisfaction ratings over the past were online travel services (which improved by ~1.5 percentage points to a composites score of 78) and social media (up ~4 percentage points to 78).

Two other industries that notched improved composite scores were household appliances – doing quite well with an ~81 score — and passenger air travel which, while still mired in a low index of 71, actually is during a tad better than in earlier years.

Even though the overall trends in customer satisfaction haven’t been in the right direction, more than 70 companies managed to achieve ACSI scores of 80 or better in the most recent evaluation, which has to be considered a very positive outcome. Most of these firms are manufacturers rather than service companies – which also continues a trend observed in prior-year surveys.

Additional results and detailed findings can be viewed here. Do any of the company findings surprise you?

The Ideal Privacy Policy?

Phillip Nones Business, Direct Marketing, Marketing Communications, Security, Social Commentary, Social Media , , , ,

policyRecently, I came upon a column written by software entrepreneur and business author Cyndie Shaffstall in which she proposes the following policy for any company to adopt that truly cares about its customers’ privacy:

The Ideal Privacy Policy:

1.  We have on file only your first name, last name, and e-mail address.

2.  We ask for nothing else.

3.  We send you only e-mails you request.

4.  We have nothing to share with others – and wouldn’t if they asked.

5.  We won’t change this policy without prior notice – ever. 

Thank you for being our customer, 

~ Your Grateful Vendor 

Cyndie Shaffstall
Cyndie Shaffstall

As Shaffstall herself acknowledges, she’s never actually seen a policy like this.

But if a company actually adopted such a policy, it would certainly make people more comfortable about purchasing its products — particularly things like phones, wearables and other products that capture and process user-specific data as part of their functionality.

Unfortunately, Shaffstall is correct in asserting that few if any companies would actually adopt such a privacy policy.  Because if they did, they’d be voluntarily walking away from so much of what makes the online world such a lucrative business proposition.

But think for a moment:  Wouldn’t it be absolutely wonderful if we didn’t have to consider such privacy policies “too good to be true”?

Do you know any real-live examples of companies whose privacy policies come close to this ideal?  If so, please share them with readers here.

Online customer care: Is retailer responsiveness going in opposite directions at once?

Phillip Nones Branding, Business, Marketing Communications, Social Media , , , , , , , ,

waiting for a responseAn interesting shift is happening in online customer care:  Response times are improving on social media while they’re getting worse in e-mail communications.

That’s what a new analysis by customer interactive software provider Eptica, as outlined in its 2015 Multichannel Customer Experience Study, is showing.

What Eptica has found is that retailers’ response times to answer customer queries posted on Twitter have improved dramatically in the past year.

Today, a customer query is being answered in an average time of a little over 4 hours.

That’s more than twice fast as in Eptica’s 2014 study, when the average response time clocked in at just over 13 hours.

In addition, the number of tweets successfully handled by retailers stands at around 43%, which is a full ten percentage points higher than what Eptica found in its 2014 study.

While more improvement is needed, the trend line is looking pretty good.  And it makes sense, since the “immediacy” of social media platforms is where many people believe a quick response should be forthcoming.

Crossing Lines

lines crossingBut while customer care response times via social media are improving, the opposite appears to be the case in e-mail customer service – and startlingly so.

Eptica’s evaluation shows that the average time it takes to respond to customer service queries submitted via e-mail is significantly longer than just a year ago.

Then, the average response time was ~36 hours.  Now, it’s nearly 44 hours – or nearly two days.

And while more e-mail customer service queries are successfully handled via e-mail when compared to tweets (~58% versus ~43%), that figure is worsening as well.  Last year, the percentage of e-queries successfully handled was ~63%.

More broadly, there continues to be a pretty significant disconnect between the “ideal” and the “reality” when it comes to online customer care and service.

Nearly all retailers provide an e-mail channel through which consumers may contact them.  But … less than three-fourths of them actually answer the e-mail messages they receive.  Moreover, the responses they provide – often automatically generated – don’t answer the customer’s question.

For a consumer with an issue or a concern, there’s little difference between getting no answer at all and receiving one that’s a “non-response response” in answer to a specific query.  Both seem to convey this message, “We don’t much care, because your issue just isn’t that important to us.”

Turning to social media, nearly 90% of major retailers have a presence on Twitter.  There, the “ignore” factor is even bigger than with e-mail:  ~45% don’t respond to their customers’ queries.

So while the social media figures certainly look better now than they did a year ago, it turns out there’s still a good ways needed to go.

Burgeoning social activity is no reason for retailers to take their foot off the gas pedal when it comes to supporting their customers via e-mail.  E-mail may not be the most exciting channel, but it’s the way millions of consumers prefer to communicate with retailers, companies and brands.  It’s counterproductive and foolish to diss them or treat them like second-class citizens.

In my own personal experience I’ve experienced the exact dynamics as described by Eptica at work – and I’m not afraid to name names.  TruGreen® Lawn Care did a stellar job of avoiding responding to my e-mail and phone queries … but it took less than two hours to get a response from someone at the firm after I posted a not-so-happy tweet about the company’s (lack of) responsiveness.

For me, the “public shaming” aspects of Twitter turned out to be far more of a squeaky wheel than the “private pleading” of an e-mail or phone message.

Do you have personal anecdotes of your own about the dynamics of online customer care?  Please share your thoughts and experiences with other readers here.

Hotels Finally Turn the Corner on Customer Satisfaction

Phillip Nones Branding, Business, Uncategorized , , , , , , , , , , , , ,
Hotel guest satisfaction surveys
According to J. D. Power, hotel guest satisfaction ratings in North America are up for the first time in years.

One of the industry segments that took the biggest beating in customer satisfaction during the recent recession was the hotel sector.

Annual surveys conducted by J. D. Power charted a continuing decline in satisfaction rates.  In everything from reservations and the check-in process to the cost of stay, hotel customers have been giving “thumbs down” for the past half-decade.

Until now.  

Marketing information services company J. D. Power & Associates, part of McGraw Hill, has just released the results of its latest annual survey, based on responses from more than 68,700 hotel guests in the United States and Canada collected between July 2012 and May 2013. 

J.D. Power has conducted these hotel industry surveys annually for the past 17 years.

According to the 2013 North America Hotel Guest Satisfaction Index Study, the overall guest satisfaction rating index is 77.7 on a 100-point scale. 

That may seem like a “Gentleman’s C,” but it’s an increase from last year’s 75.7 score. 

More to the point, it’s the first time in quite a few years in which the aggregate rating has gone up.

Where has satisfaction increased?  Pretty much in every category surveyed, with the largest gains coming in the reservations process, check-in/check-out procedures, and hotel costs and fees.

Other categories included in the study were guest room satisfaction, food and beverage service, other hotels services, and hotel faciliites.

The largest area of continuing discontent is in Internet usage.  Customer complaints are all across the board — ranging from spotting connectivity and slow speeds to usage charges.

Other areas where improvements are sought are in HVAC comfort and controlling noise levels.

What about customer reaction to rising hotel rates?  After all, they’ve gone up by about 5% over the past two years. 

But the J. D. Power survey found little concern about rate increases.  Rick Garlick, director of the survey, suggests that pulling out of the economic downturn might explain this lack of concern.  “The economy may be playing a part in price satisfaction because people have a little more to spend,” he noted.

The people who appear to be the least satisfied with their stay experience are the ones who chose to stay at a hotel based on price alone.  It’s like the adage says:  “You get what you pay for.”

On the other hand, the most satisfied guests weren’t necessarily people who stayed at 5-star properties.  Instead, they’re ones who evaluated hotels carefully beforehand using online tools such as third-party hotel reviews and ratings.  The “eyes wide open” strategy, as it were.

Such evaluation tools have made it easier to know what to expect from a hotel stay, contributing to overall satisfaction ratings because there’s less likelihood of a “rude awakening.”

The J. D. Power surveys also ask respondents to rate hotel brands.  I was interested to see which hotels scored highest in the various different categories in this year’s survey:

  • Luxury category:  Ritz-Carlton
  • Upscale:  Hyatt
  • Midscale Full Service:  Holiday Inn
  • Midscale:  Drury
  • Economy/Budget:  Microtel (Wyndham)
  • Extended Stay:  TownePlace Suites

Come to think of it, none of these results is particularly surprising.  In fact, three of the brands (Ritz-Carlton, Holiday Inn and Drury) have been tops in their category for three or more consecutive years of the J. D. Powers studies.

Additional survey findings are available here.

Bank of America: The Financial Institution Everyone Loves to Hate

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Bank of AmericaIf you’ve ever had an unpleasant or unfulfilling experience regarding Bank of America and how it handles transaction fees, branch operations or customer service in general, raise your hand.

Uh-huh.  I thought so. 

Our family’s lone experience working with BofA (when an inherited bank CD matured a few years back) was enough to elicit the famous cry:  “Never again!”

Evidently, we’re not alone.  According to the latest American Customer Satisfaction Index report, customers give Bank of America its lowest satisfaction score in more than a decade.

In fact, BofA’s 2012 score of ACSI score of 66 out of possible 100 points is two points lower than its 2010 score.

There’s more:  Not only does BofA trail all of its main banking competitors, it’s the only financial institution with a customer satisfaction grade that is actually lower than its pre-recession level.

Not surprisingly, the bank is also the least popular one among consumers.  It’s had that ignominious distinction for four years running.

Just how are big banks faring in general?  The ACSI report reveals the following index scores (out of a possible 100):

  • JPMorgan Chase:  74 (up 7 points from 2010)
  • Wells Fargo:  71 (-2)
  • Citigroup:  70 (-1)
  • Bank of America:  66 (-2)

In general, consumers tend to rate smaller banking institutions, with an aggregate score of 79, higher than their big-bank rivals.  But the highest ratings in this sector are reserved for credit unions (82).

Incidentally, the American Customer Satisfaction Index is also calculated for the major insurance carriers — one of the 47 industries and 10 sectors that it surveys quarterly.  Who’s on top there?  Blue Cross/Blue Shield scores best among health insurance firms with a 73 rating, while Aetna brings up the rear with a 67 score.

As for property and casualty insurance providers, the scores are somewhat better.  State Farm and Progressive lead in this category with an 81 score … but none of the other major firms do significantly worse.

If you’re interested in exploring the results in greater depth, you can review the current and historical ACSI scores here.

The companies everyone love to hate.

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Bad company ratingsIt seems that there are certain companies people like to criticize all the time. One that I’ve heard quite a bit of grumbling about in recent months is Comcast.

Now comes along a report from 24/7 Wall St, an equity investment data aggregator and investment firm, which has compiled a list of the “Ten Most Hated” companies in America.

Its list is based on reviewing a variety of qualitative and quantitative attributes. Companies were examined based on total return to shareholders in comparison to the broader market plus competitors in the same sectors.

Financial analyst opinions on publicly held companies were also reviewed, as well as findings from consumer surveys conducted by diverse sources (the University of Michigan’s American Customer Satisfaction Index, Consumer Reports, J.D. Power & Associates, ForeSee, etc.)

Also evaluated was the Flame Index, which uses an algorithm to review ~12,000 websites to rank companies based on the frequency of negative words and terms associated with them.

Lastly, an analysis of media coverage to determine the extent of negative and positive news coverage was conducted.

Stripping away such quasi-governmental agencies as the U.S. Post Office, Freddie Mac and Fannie Mae, it leaves us with an interesting list of the “worst of the worst.”

Some of the companies that made the 24/7 Wall St list – and the reasons for them achieving the dubious honor – include:

American Airlines – Not only has this airline filed for Chapter 11 bankruptcy, it’s rated the worst airline for customer service. It’s performing at or near the bottom of the heap on attributes like on-time departures, flight cancellations, and baggage handling problems. American Airlines’ University of Michigan ACS index of 63 is dramatically lower than Southwest – the industry’s leader which scored an 81 on the index.

Facebook – This behemoth may claim a user base of 800 million+, but that doesn’t stop people from having major grievances with the company. A recent customer satisfaction survey conducted by IBOPE Zogby found that ~30% of users consider Facebook’s customer service to be “poor.” (Anyone who has ever actually tried to interface with the company might be tempted to ask, “What customer service?” Facebook has also received negative press coverage for sneakily instituting, with no warning, privacy settings that change how it shares personal information with others.

Best Buy – This company is still smarting over self-inflicted problems during the holiday season when it ran out of popular merchandise it sold online … then neglected to inform buyers of the fact until just two days before Christmas. The retailer’s explanations (excuses?) seemed lame. It’s one reason ForeSee dropped Best Buy from being the second-ranked company for retail satisfaction prior to the holiday season (just behind Amazon). Now Best Buy is ranked so poorly, it no longer appears among the Top 20 national retailers. To make matters worse, Forbes magazine predicts that Best Buy is a prime candidate for simply disappearing … the only question is whether it will happen before or after Sears/Kmart bites the dust.

Netflix – Here’s a company that’s gone from the “highest of the high” to the “lowest of the low” in one fell swoop. Instituting dramatically higher pricing in August 2011 resulted in the rapid loss of more than 800,000 Netflix subscribers … accompanied by the company’s stock price plummeting 30% from over $300 per share to $215 in under six months (and more than 60% for the full year).

Johnson & Johnson – When an iconic brand like J&J can manage to have a slew of two dozen product recalls over a two-year period – including with Motrin and Children’s Tylenol – it’s bound to have a dramatic impact on company performance and reputation. The FDA took over three Tylenol plants in March 2011, and OTC drug sales are off double digits compared to the previous year. While J&J’s stock price hasn’t tanked in the event, it has remained flat – which is horrendous performance compared to the rest of the pharma industry.

For the record, the five other companies named to 24/7 Wall St.’s “Ten Worst” list were:

 AT&T
 Bank of America
 Goldman Sachs
 Nokia
 Sears

… And I’m sure all of us can think of reasons why these also gained entry onto the “rogue’s gallery” of corporations.

A word of advice to customer call centers: Location matters.

Phillip Nones Uncategorized , , , , , , , , , , , , , ,

In the drive to become low-cost producers in their industry categories and to be price-competitive in a down economy, many companies are looking into every corner of their business to wring out excess costs wherever they can.

And with business as soft as it is right now, one would think that telephone customer contact centers are a prime target for outsourcing and offshoring. After all, it’s one of the more labor-intensive operations. And relying on resources in English-speaking Second and Third World countries is far cheaper than employing American workers — 50% to 75% less costly by some estimates.

But instead of migrating offshore, evidence is mounting that some companies are beginning to bring their call center operations back into the United States instead.

Why is this happening? Well, when one considers that the purpose of a call center is to promote customer satisfaction, placing these functions offshore hasn’t exactly accomplished that. It’s a topic I’ve addressed before in this blog.

And now, we have new survey data that prove it. A recently-published survey conducted by CFI Group (Claes Fornell International) covers 2,200 respondents who rated telephone customer contact centers run for retailing firms, cable/satellite TV providers, cellular phone service providers, financial service firms, computer equipment manufacturers and government agencies.

The annual survey uses the University of Michigan’s American Customer Satisfaction Index to rate overall satisfaction. In this year’s study, that satisfaction index stands at 74 on a 100-point scale. Not a great score by any stretch; in fact, most companies would surely want to score better.

But when comparing the ratings for domestic call centers versus offshore ones, the differences are stark. The domestic satisfaction index was 84, while the offshore index was only 62.

Moreover, the survey respondents were nearly twice as likely to recommend a company or product to others if they thought the customer contact center reps are in the United States … and three times more likely to abandon the brand if the call center is located offshore.

Is this disparity in results simply the result of American nativism or chauvinism? Perhaps. But it becomes a lot harder to discount the differences when we see that respondents reported that U.S. call center reps resolved their problems 68% of the time during the first contact — “first-call resolution” in industry jargon — as compared to only 42% of the time for contact centers located offshore. That’s a difference that can’t be ignored.

Looking into every corner of a business to find ways to drive down costs certainly makes sense. But in the case of customer call centers, there’s clearly a danger of being “penny-wise, pound-foolish” … and risking a customer backlash that ends up negating any cost savings you might have realized – or worse.