February 19, 2002, 12:00 AM

E-retailing racks up high rankings in a new customer satisfaction survey

On a scale of 100, customers shopping web-based retail outlets registered a satisfaction rating of 77 in such areas as perceived quality and value vs. 74.8 for shoppers in traditional retail outlets.

 

Customer satisfaction with web-based retailing sites outstrips satisfaction at retail chains, according to a new customer satisfaction measure released today.

On a scale of 100, customers shopping web-based retail outlets registered a satisfaction rating of 77 in such areas as perceived quality and value vs. 74.8 for shoppers in traditional retail outlets. The report is part of the quarterly American Customer Satisfaction Index.

“These numbers bode well for a new era of profitability for the Internet, driven by an increasing sophistication about the link between customer satisfaction and profitability,” says Larry Freed of ForeSee Results, which specializes in assessing web customer satisfaction. “We’re past the days of just trying a bunch of cool ideas, and moving into a more bottom-line era of getting an understanding of what customers actually care about, and what will produce both satisfaction and profitability.”

In addition to leading traditional retailing in customer satisfaction, online retailing also leads the other online categories that the index measures for customer satisfaction. Those categories are financial services, portals and auctions.

The index is produced through a partnership among the University of Michigan Business School, American Society for Quality, and consulting firm CFI Group. The e-commerce report was produced in partnership with ForeSee Results. ForeSee Results, by using the American Customer Satisfaction Index technology for its clients, is able to measure customer satisfaction and forecast the impact of web site changes on results such as customer loyalty and retention, referrals, and purchase behavior.

In e-commerce companies, Amazon.com posted the highest score at 84, with BarnesandNoble.com at 82 and eBay at 82 not far behind. The biggest improvement was made by 1-800-Flowers.com, where satisfaction jumped 10% from 69 to 76. Buy.com’s satisfaction level exceeded the industry average at 78.

While the numbers provide cause for optimism for e-commerce and the economy at large, Freed says that the competition is going to get tougher. "The companies that can really stay on top of what matters to web customers and what doesn`t will be the winners," he says. "With traditional retail showing increased customer satisfaction and more experienced companies dominating the web, e-retailers will face stiffer competition on both fronts."

Among the biggest portals, Yahoo rated 73, MSN, 67 and AOL, 58. The average for all portals was 65. “AOL`s score is representative of a common struggle among portal companies---not quite knowing what to give customers who still do not know exactly what they want from portals,” Freed says.

The American Customer Satisfaction Index uses a methodology that blends sciences and mathematics to weight key drivers of satisfaction and isolate the components of satisfaction that produce certain customer behaviors such as loyalty and purchasing behavior.

 

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