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ACSI-Customer-Sat-Retail-Sector-Feb2015Customer satisfaction with the retail sector has slipped, reports the American Customer Satisfaction Index (ACSI), with traditional retail the culprit. The latest annual study finds that customer satisfaction with almost all forms of traditional retail dropped, while satisfaction with online retailers improved. The results are a reversal of trends seen in last year’s report, in which satisfaction with traditional retailers had closed the gap with online retail.

Here’s a look at how some of the retail industry segments fared.

  • Department and Discount Stores

This was the only traditional retail segment to not experience a decrease in customer satisfaction, remaining flat at an overall level of 77 (on a 100-point scale, where 80 is considered the threshold of excellence) for the third consecutive year.

Among these retailers, Nordstrom continued to be the most-highly rated, picking up 3 points to a score of 86. Nordstrom was followed by Dillard’s (81) and the average of smaller chains (81). Wal-Mart languished at the bottom of the list again, dropping 3 points to a score of 68, this year joined by Exchange, which plummeted by 7 points.

As a result, the gap between the last-placed and top-rated retailers widened to its largest point in the study’s history, dating back to 1995.

Meanwhile, department and discount store customers were again most satisfied with the convenience of store locations and hours (86) and least satisfied with the speed of the checkout process (72).

  • Specialty Retail Stores

The specialty store segment lost a point in overall satisfaction, dipping to a score of 79 a year after reaching its highest point since 2001.

Costco continued to lead the pack, remaining steady at a high score of 84, narrowly ahead of L Brands (83), which was measured for the first time. At the bottom of the list were Gap (-2 points to 75) and Home Depot (-3 points to 76).

In terms of customer experience, the ability to provide brand names, the layout and cleanliness of store, the courtesy and helpfulness of staff, and the convenience of store location and hours were all grouped at the top by satisfaction (82). Shoppers were the least satisfied with the frequency of sales and promotions and the speed of the checkout process, each with an index reading of 76.

  • Supermarkets

Supermarkets shed a couple of points after reaching a new peak last year, registering an index score of 76 in the latest study. A year after being the runaway leader with a score of 86, Publix shed 4 points in satisfaction and dropped to the third place, supplanted by the newly-measured Wegmans and Trader Joe’s, each with a score of 85. This is the first year that Publix has not led its category; up until this year it was the only company in ACSI’s 20 years of coverage across 43 industries that had led its category each year.

Meanwhile, Wegmans’ top position is its latest accolade; a Harris Poll recently found it to be the “visible company” with the best reputation, edging last year’s winner, Amazon.

At the bottom of this list? Wal-Mart again, this time with a low score of 71.

Much as with the department and discount store segment, supermarket shoppers were most satisfied with the convenience of store location and hours (88) and least satisfied with the speed of the checkout process (74).

  • Health & Personal Care Stores

The health and personal care store category shed a couple of points in overall satisfaction, registering an average score of 77.

This year, the study included the pharmacy services of the largest merchandise and supermarket chains, with Kroger entering the rankings in the lead with a score of 81. That was matched by the average of smaller stores.

Wal-Mart, another new rankings entrant, fared poorly again, with its low score of 68 being 7 points below the next-lowest, CVS Caremark. Meanwhile, Rite Aid saw the biggest improvement, gaining 4 points to a score of 78.

In a familiar refrain, customers were most satisfied with the convenience of store locations and hours (89) and least satisfied with the speed of checkout processes (79). Of note, the quality of pharmacy services (88) registered a high score.

  • Internet Retail

After dipping to its lowest point since 2001 in the 2013 study, this latest report finds that overall satisfaction with internet retailers improved by 4 points to 82. Despite shedding a couple of points in its index reading, Amazon (86) remained the online retailer to beat, 5 points ahead of its nearest competitors (Newegg, Netflix, and the average of smaller online retailers).

Netflix gained 2 points to a score of 81, continuing its rebound from its low point in 2011 (74). Meanwhile, last year’s big drop in satisfaction among the aggregate of smaller internet retailers was reversed in this year’s findings, with these smaller online retailers picking up 6 points to a score of 81.

As with last year, shoppers were most satisfied with the ease of checkout and payment process (90) and least satisfied with the usefulness of site-generated recommendations of other products (76).

Other Findings:

  • After reaching a new peak last year, overall satisfaction with retail trade decreased by 1.2 points to a score of 76.8. Nevertheless, that was the second-highest customer satisfaction rating since the ACSI began measuring the retail sector in 1995. It’s worth noting that last year’s report included customer satisfaction with internet brokerage sites in its retail trade average, while this year’s report omitted brokerages.
  • Satisfaction with gasoline stations dipped by a couple of points to 73.

About the Data: The ACSI describes its methodology as follows:

“The ACSI Retail Report 2014 is based on interviews with 8,738 customers, chosen at random and contacted via telephone and email between October 7 and November 7, 2014. Customers are asked to evaluate their recent experiences with the largest brick-and-mortar and Internet retail sector companies in terms of market share, plus an aggregate category consisting of “all other”””and thus smaller””retailers. The survey data are used as inputs to ACSI’s cause-and-effect econometric model, which estimates customer satisfaction as the result of the survey-measured inputs of customer expectations, perceptions of quality, and perceptions of value. The ACSI model, in turn, links customer satisfaction with the survey- measured outcomes of customer complaints and customer loyalty.”

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