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American Customer Satisfaction Index (ACSI) Q4 Results Released Today

The American Customer Satisfaction Index (ACSI) Q4 results were released today.  The ACSI was founded at The University of Michigan in 1994 and is the leading measurement of Customer Satisfaction in the world.  And while others may make up acronyms and new gimmicks to try to measure consumer satisfaction, the ACSI is the only measurement that has the financial evidence behind it that proves its accuracy, reliability and precision.  And the only methodology that stands up to peer review and has the respect of Economists and Researchers around the world.

Fourth Quarter ACSI Results:  The fourth quarter results cover some very important sectors: Retail, Finance and E-Commerce.  Overall, the ACSI dipped by 0.1% to a 75.9, just 0.2 off its all time high and 0.2 above the Q4 2008 results.  Very impressive results considering the still difficult economy.  These results do not hurt the economic outlook and give us confidence that the economic recovery has a very good chance of continuing on its current pace. 

E-Commerce Key Findings (for the full report check out www.ForeSeeResults.com )

• Satisfaction with e-commerce is up nearly 2% since last year to 81.4.
• The increase in the overall e-commerce sector score is clearly driven by the rebounding online brokerage industry, up 5.4% to 78, with Fidelity and Charles Schwab sharing the top spot with a score of 79.
• The e-retail industry, always the strongest within the e-commerce sector, gains one point to a score of 82 and Netflix takes the top spot.
• The online travel industry ties its all time high aggregate score of 77, not seen since 2005.  Expedia holds the top spot.

Retail Sector: Customer Satisfaction with the retail sector, which includes department and discount stores, specialty retail stores, supermarkets, health and personal care stores and gas stations rose 1.3% to a score of 76.2.  Department and discount stores climbed 1.4% to an ACSI score of 75.  Some notable results include Target up 4% to a score of 80.  Specialty retailers rose 1.3% to a score of 77, with Barnes & Noble leading the way with a score of 84. Supermarkets remained unchanged with Publix continuing to lead the way with score of 86, up 5%.

Finance & Insurance:  This sector improved 1.4% to a score of 77.1, with Banks coming in with a score of 75 and Credit Unions registering 84.  Life Insurance rose 1.3% to 79, Health Insurance went up 2.7% to 75 and Property & Casualty Insurance dropped 1.2% to a score of 80.

You can find out more about the American Customer Satisfaction Index at www.ForeSeeResults.com and TheACSI.org

Summary

So, why is Customer Satisfaction important?  Well, as a leading economic index, the ACSI is unmatched.  And for individual companies an accurate measurement of customer satisfaction can give you the intelligence you need to make the right decisions to optimize your investments.  Consumers go where they are satisfied, so to win in the ultra competitive environment we live in today, companies must satisfy their customers or they face the risk of not surviving.

Social Security Website Better Than Amazon, Google and Netflix!

Wow, what a headline.  And it's true.  At least from user's perspective.  We released the Q4 American Customer Satisfaction Index (ACSI) E-Government Satisfaction Index this week and the results were very good. 

Across over 100 Federal Government websites and over 250,000 visitors surveys, satisfaction with Federal Government websites registered a score of 75.2 on a scale of 0-100.  Equaling the highest score ever registered by the ACSI E-Gov Index last quarter.

But more impressive then that was 27% of the sites measured scored 80 or higher with the Social Security Retirement Estimator (www.ssa.gov/estimator) and Social Security iClaim online benefits application(www.socialsecurity.gov/applyonline) both scored 90.  To put that in perspective, in the last published ACSI results covering the e-business and e-commerce sectors included Amazon at 86, Google at 86 and Netflix at 85.

You can download the full report here or email me and I will send you a copy.

So does that mean the Social Security site is better than Amazon's, easier to use than Google's, has more functionality then Netflix?  Not necessarily.  But more importantly it means that visitors to the site are having a better experience and are more satisfied with the experience on the Social Security site.  The site is doing a better job compared to their expectations.

Now, I hear other self proclaimed experts go on and on about what sites are the best based on their personal opinion.  Not to say their opinion is worthless, but it is worth no more than any other site visitor.  In fact, most "experts" are not "normal" visitors.  Listen to your site visitors, measure their satisfaction and know their expectations.

Congratulations to the folks at the Social Security Administration and the rest of the sites that scored 80 and above, the threshold for a great performing site.

Satisfaction Down on Cyber Monday

Our first 2009 holiday benchmark shows some cause for concern: online satisfaction with e-retail on Cyber Monday is at its lowest level in four years.

Why is this troubling? Because the ACSI methodology used to conduct the survey predicts future financial success and links satisfaction to likelihood to purchase online and offline. I'm seeing online retail forecasts ranging a 3% increase to an 8% increase, with a few outliers suggesting higher or lower.

We know sales were up on Cyber Monday--higher than last year and higher than Black Friday. But satisfaction was down. Does this mean people are buying early to take advantage of discounts, or do you think we'll see a strong and robust online holiday shopping season? 

Are Healthcare Websites Sick?

As the debate on healthcare continues, we decided to look at the healthcare websites that we measure at ForeSee Results and see how they are meeting the needs of consumers.  You can download the full report here.

Why look at consumer satisfaction of healthcare sites?  Well, as the debate goes on, one thing is certain, healthcare costs a lot of money.  And one way to reduce and manage some of those costs is better use of technology, for example, improving the quality and effectiveness of the healthcare websites.  The web brings us the opportunity of a win-win that is rarely available in other channels.  The first win is providing more information to citizens when they need it, anytime from anywhere you can get to the internet.  More information that is more readily available to consumers is a big win for consumers.  The second win is cost.  By providing more information, be it educational information about symptoms of a disease, potential side effects of a drug, information about the services provide by a hospital or information about deductibles and co-pays of your health insurance, we can lower the cost of providing the information to consumers.  A more informed consumer will make better health care decisions and lower the total cost of the servicing of that consumer.  A win - win!

So, how did the healthcare sites we measured do.  First of all, we surveyed more then  40,000 consumers who visited these healthcare sites in October and we utilized the proven methodology of the American Customer Satisfaction Index (ACSI) that was founded at The University of Michigan to measure the consumers satisfaction with the websites and how it would impact the consumer's future behavior.  We segmented the sites into four categories and their satisfaction scores are as follows:

• Government Health Information Sites     79
• Pharmaceutical Sites                           78
• Hospital Sites                                      73
• Health Insurance Sites                          64

The aggregate across all sites was 75.  To put these numbers in comparison, we look at 80 as the threshold for a very good site.  On average, the over 700 sites measured everyday by ForeSee Results, resulting in over 1 million completed surveys per month, score a 72, 4% below the healthcare index.  Not bad! 

The sites measured were wide ranging in their success to date, with scores as low as 42 and as high as 86.  86 is the same score that web leaders Amazon and Google obtained in their most recent published ACSI report.  Very impressive results from some of these healthcare sites.

I applaud all the sites (even the ones scoring in the 40's) because the first step to improvement is to measure.  You cannot manage what you do not measure.  And if you don't measure it you won't know if you improved.  So those low scoring sites are at the beginning of a journey that is bound to take them nowhere but up.

So, does satisfaction really matter for these sites?  Well, we talked about the win-win earlier, but lets take another perspective on it.  When we looked across those 40,000 consumers surveyed in October on these healthcare sites, we see that there is huge payback for high satisfaction.  When we look at the consumers who scored 80 or higher and compare them to those that scored 69 or lower, across all the sites, we see that the highly satisfied consumer is:

• 139% more likely to return to the website
• 169% more likely to recommend the website to others
• 153% more likely to use the website as a primary resource for interacting with the healthcare organization

This is truly a huge payback for satisfying your customers and results in the win-win, more information and services at a lower cost.

Holiday Predictions

Well, Thanksgiving dinner is over and as I sit here, after having eaten way too much Turkey and way too many deserts, it is time to ponder the online holiday season that is just minutes away from kicking off.  Actually, it seems in many ways it has already started.  Things used to be simple...and defined.  We had Black Friday and Cyber Monday.  But now, many retailers have turned this week into "black Friday week" with aggressive discounts all week long.  I remember reading an article a while back where many prominent retailers said there wasn't going to be the deep discounting that we have seen during prior holidays.  We will see if they can hold out.  From the looks of things so far, I doubt it.

All of us that work in and around e-retail are being asked about our predictions for 2009 holiday sales online. Here are my predictions.

Overall, I’m cautiously optimistic and think sales will be up. And I say that for a few reasons.

1. Everyone’s being a lot smarter about inventory, and e-retailers always have a leg up when it comes to inventory because they can leverage so many different warehouses, while a brick and mortar store has more limited inventory. Those who have bought well will do better both online and offline, but the lack of inventory offline will help online retailers this year.

2. H1N1 paranoia will send more people online to do their shopping. What better way to avoid nasty germs (except for those in your own house or office...and of course those computer viruses) than by shopping online?  That reminds me of a story about my grandmother.  Thanksgiving seems like a good time for a story.  Many years ago, back in the mid to late 80's, when we first started hearing about computer viruses there was a widely publicized computer virus.  At that time I was working in technology at National Bank of Detroit.  My grandmother calls me and is all worried, wondering if I am sick.  She was even ready to bring me some chicken soup.  I told her I wasn't sick, and she said, "but I heard on the news about that awful computer virus and I know you work with computes all day".  Aren't grandmothers great!

3. For the first time last year, we saw price had a big impact on satisfaction. In previous years, it was interesting that that despite e-retailer’s assumption that people cared only about price, there were actually other elements of the online shopping experience that impacted them more. We were able to find this out using the powerful technology of the American Customer Satisfaction Index (ACSI) and prove it to be true with the data.  But last year, with the recession, we saw that change and price became a key driver of satisfaction. Retailers are jumping on discounting early and they know they need to slash prices to attract customers.

4. Recession fatigue. We’ve been in this recession for more than a year. Those of us that have jobs who have been saving money and watching spending may be tired of being so careful and may be a little more willing to spend money this year.  Maybe some of the pessimism is finally lifting. I wouldn’t say we’re jumping for joy, but maybe we’re hopping for mild excitement.  And what a better time to show that mild excitement then during the holiday season.

5. When we look at years of satisfaction trending data, we see that customers are as satisfied today as they were six months ago and a year ago, after sat took a huge dive last September. Since satisfaction as measured by the ACSI is predictive of online and offline purchases, if satisfaction is keeping steady into a Christmas season, we would expect to see sales go up this holiday season.

So what are your predictions?

Latest American Customer Satisfaction Index Results Released Today

Today the American Customer Satisfaction Index (ACSI) released its latest results on customer satisfaction.  You can read the full commentary here.   Covered in this quarter's results are some of my favorites - Beer and Chocolate.  The categories covered in the Manufacturing Nondurable Goods Sector include Apparel, Athletics shoes, Breweries, Cigarettes, Food Manufacturing, Personal Care & Cleaning Products, Pet Food and Soft Drinks.

If you follow the American Customer Satisfaction Index or ForeSee Results, you know that Customer Satisfaction as measured by the ACSI at a macro level is a leading indicator for economy (Consumer Spending, GDP Growth, etc.) and at an individual company level is a leading indicator for financial success.  The ACSI was founded at the University of Michigan.

So, what does the future hold?

Overall, the National ACSI score dipped ever so slightly from 76.1 (the all time high) last quarter to 76.0 this quarter, a very minor 0.1%.  And it is up a significant 1.3% from Q3 2008 when it had a score of 75.0.  The Q2 ACSI results predictive model pointed to an increase of consumer spending of 3.25% , much higher then most others were projecting and actual Q3 consumer spending growth turned out to be 3.35%.  With a flattening of the score this quarter it is projecting consumer spending to be between 2% and 3% in Q4.

Some of the companies that really excelled in these results include Levi Strauss rising 6.4% to a score of 83, Anheuser-Busch rising 3.7% to 85, Mars, Hershey and Nestle all seeing increases between 1.2% and 2.4% with scores between 85 and 87.  So, America is going back to basics - "non-designer" Jeans, Anheuser-Busch and Chocolate!  Not a total surprise, when the economy is tough we tend to gravitate back to what is familiar and what gives us simple pleasures.

Satisfaction with E-Gov Hits New High

Great news from the American Customer Satisfaction Index (ACSI) E-Government Index today: an all-time high. In fact, the highest score in six years of measurement and the biggest quarter-over-quarter increase ever.

Download the full, free report here.

So, to what do I attribute the increase?

1) We are almost a year into the most tech-savvy presidency in history. At times, it has seemed to me that President Obama has struggled to find footing with social media recommendations that could confuse priorities and shift attention away from the core business of e-government: communication information via the web. But I think this study is pretty convincing evidence that as he settles into his stride, his leadership is improving e-gov. The score didn't go up just a little bit. It went up 2% and almost 2 points to 75.2. This represents almost 300,000 citizen surveys, so an increase of two points and 2% is significant.

2) We did some analysis and found the longer a federal website has been measuring satisfaction, the bigger the improvements, over both the long term and short term. Those that have been measuring 5 or more years had the biggest increases, followed by those who have been measuring for four years, and so on. After all, you can't manage what you can't measure. So while the Obama administration deserves some of the credit, the truth is that the sites with the biggest increases have been watching these issues for YEARS, long before President Obama was even elected to national office. Federal web managers have been working HARD on this stuff, and there is a core group running e-gov that is really committed to listening to Voice of Citizen. They are committed to using e-gov to better serve the citizenry, and they can't do that without understanding what citizens want and need from their government online.

It's an exciting time for e-gov. While we will doubtless see ups and downs over the next quarters, satisfaction overall has been on the upswing, even outperforming some private sector industries. E-gov is one of the things that the federal government seems to be doing really well for the most part. There is always room for improvement, especially if expectations continue to increase. But there are a lot of individual sites doing very, very well.

Latest E-Gov Satisfaction Scores out on Tuesday.

I can't wait to share the latest American Customer Satisfaction Index (ACSI) scores for e-government due out Tuesday.  The results are remarkable.  We are now three quarters into the new "technology savvy" administration, and it will be interesting to see if this has had any impact on the satisfaction scores. 

This report is useful and interesting for a couple of reasons:

1) We can see the trend in citizen satisfaction with e-government overall. The trend over the last six years is generally up, though the recent trend has been stagnation. Tuesday's report will shed light on whether any of the efforts of the Obama administration have come to fruition in terms of improving citizen satisfaction with e-gov initiatives.

2) We can see how indivdual websites are doing compared to each other, compared to the private sector, and compared to themselves over time. There are 104 individual government websites included in the report from virtually every agency and department. Each website gets a score on a 100-point scale; the higher the better. Anything over 80 is generally considered excellent. Which websites have made the biggest improvements over the last quarter? Over the last year? Which sites are better than Amazon and Google? Which sites aren't doing so well?

3) We can quantify the role of online satisfaction on citizens' likelihood to return to the site, recommend it, even use it as a primary resource. We can do this in aggregate for the federal government overall, and for individual sites.

The data is being compiled and reported as we speak--everyone is busily getting everything together for the release on Tuesday.

This report is useful and interesting for a couple of reasons:

1) We can see the trend in citizen satisfaction with e-government overall. The trend over the last six years is generally up, though the recent trend has been stagnation. Tuesday's report will shed light on whether any of the efforts of the Obama administration have come to fruition in terms of improving citizen satisfaction with e-gov initiatives.

2) We can see how indivdual websites are doing compared to each other, compared to the private sector, and compared to themselves over time. There are 104 individual government websites included in the report from virtually every agency and department. Each website gets a score on a 100-point scale; the higher the better. Anything over 80 is generally considered excellent. Which websites have made the biggest improvements over the last quarter? Over the last year? Which sites are better than Amazon and Google? Which sites aren't doing so well?

3) We can quantify the role of online satisfaction on citizens' likelihood to return to the site, recommend it, even use it as a primary resource. We can do this in aggregate for the federal government overall, and for individual sites.

The data is being compiled and reported as we speak--everyone is busily getting everything together for the release on Tuesday.

Congratulations to Dr. Fornell

Dr. Claes Fornell, the founder of the American Customer Satisfaction Index, and a Business School Professor at the Ross Business School at the University of Michigan, was recently given a great, and well deserved, honor.  He was awarded an honorary doctorate by the Stockholm School of Economics at its centennial celebration before the King and Queen of Sweden.  This took place at the Blue Hall of Stockholm City Hall, the venue that hosts the Nobel Prize dinner every year.

While not a stranger to honorary degrees, I am sure this one was even more meaningful to Dr. Fornell, taking place at such a prestigious location, by such a prestigious academic institution, in his home country of Sweden.

Without hesitation, Dr. Fornell is one of the smartest guys I know and is very well deserving of this honor.  His research in the study of the consumer is unmatched. Here is the rest of the story.

Without Dr. Fornell's work, we would not have the technology of the American Customer Satisfaction Index (ACSI) and therefore we would not have ForeSee Results!  So, while we at ForeSee Results don't have an honorary degree to bestow on Dr. Fornell, we do give him our admiration and gratitude.

Congratulations Claes!

ACSI E-Business Report: Google Reigns

The latest ACSI e-business report is out today with conclusive findings: with a score of 86 on the ACSI's 100-point scale, Google outperforms nearest competitor Yahoo by nine points and outperforms MSN by 12 points. Bing wasn't included in this study because the research was done before Bing formally launched.

It seems to me that Bing couldn't have come at a better time for Yahoo and MSN. Since customer satisfaction predicts customer loyalty and retention, future financial performance, and even stock prices, their best chance at this point is to combinemarketshare resources to get traffic. Problem is, though the early Bing market share numbers are good, it's mostly the result of that Yahoo andMSN market share that is being handed to Bing on a silver platter, along with the advertising and PR of the launch...excitement is high and willingness to experiment is high. But where is Bing going to get that long term advantage over Google? If Google has anACSI score of 86 and if Bing comes in about where MSN is today (75), no one will have any reason to switch long term. The only place to get the long-term advantage is from satisfying customers. Bing has to be as committed --or more--than Google. And that's a tough row to hoe. Not only because satisfaction with Google is so high but because Google and Bing have a revenue model that depends on advertising, which searches don't like. Search engines are figuring out how to make money without annoying searchers too much. It's a balance. 

If you are interested in our full report check it out  here.

Quick poll:

Can Bing do it?

What's your prediction for the Google v. Bing head to head?

Will you try Bing?