MarketTools Blog

The American Customer Satisfaction Index (ACSI) recently released its report on the 19 most hated companies in America, with Airlines, Banks, Power and Telco companies leading the list. 

It’s not surprising that industries with little competition and high switching costs – like banks, power and telco – don’t always provide stellar customer service. It takes significant time and energy to switch providers, and in some cases there just aren’t other options. They’ve got you. Airlines, however, continue to surprise me. Given the level of competition and relative price equality found on consolidator sites, it’s amazing to me that airlines are doing so little to keep customers satisfied and loyal.

According to ASCI, “passenger satisfaction with airlines dropped (from 2010 to 2011) by 1.5% to an ACSI score of 65—a very low score that keeps getting worse. In fact, airlines carry the lowest score among 47 ACSI industries (tied with newspapers). Poor service remains a problem for the industry.”

A Voice of the Customer (VOC) program is obviously critical to running a successful business. We’ve all seen statistics showing how retaining customers through customer loyalty is much more effective than converting new customers. As such, many service companies have methods in place to capture customer feedback  and track customer experiences.

However, as a market research professional, I’d like to point out some key distinctions that can be overlooked when capturing and interpreting customer feedback, because the end users of feedback data might be surprised at the kind of insights they could be missing out on.

Often when I’m working on global customer satisfaction surveys, I come across a common concern from business leaders outside of North America.  These leaders tell me they have seen their customer satisfaction scores compare unfavorably to scores from North America, even as they do all the right things to build up customer satisfaction and loyalty.  Year-over-year, they see their scores improve, but the North America scores go even higher.  They are concerned that management sees this gap and concludes that they are doing something wrong, and sometimes this concern even leads them to be resistant to the whole survey process.

And they’re right to be concerned.

I ran across an interesting piece today on the New York Times Freakonomics blog: Daniel Hamermesh writes about how his local grocery store no longer carries his favorite coconut sorbet because, although it sells well in the chain’s Austin store, it doesn’t sell well in the rest of the chain’s stores, all in Texas.  The chain purchases centrally, so they’ve discontinued the sorbet.

This got me thinking about SKU Rationalization – the analytical optimization process used to determine the merits of adding, retaining, or deleting items from a retailer's merchandise assortment. From the retailer’s point of view, optimizing SKUs helps them maintain shopper satisfaction while increasing average shopping basket size and shelf productivity.