Amazon Tops In Customer Satisfaction, While JC Penney, Dell And Apple Slip

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Internet retailer Amazon continues to set the standard for
customer satisfaction, matching the record-high score it set last year in the
annual Holiday E-Retail Satisfaction Index released by customer experience
analytics company ForeSee.

Amazon.com received a satisfaction score of 88 and has had the
highest score in the Index for the past eight years.

Second in the shopper satisfaction index with a score of 85 was
LLBean.com, up 4 points from last year. Rounding out the Top 10 were OVC.com
and Vitacost.com with scores of 84; esteelauder.com and Vistaprint.com with scores of 83
each; 1800Contacts.com, Keurig.com and Scholastic.com with scores of 82; and
Avon.com, Cabelas.com, HSN.com and Newegg.com, with scores of 81.


A bunch of online retailers were tied with satisfaction scores of 80. That
group includes 1800Flowers.com, Blair.com, chicos.com, freshdirect.com,
HPShopping.com, Kohls.com, MusiciansFriend.com, Netflix.com,
OrientalTrading.com, Shutterfly.com, Store.Apple.com,
VictoriasSecret.com and Walgreens.com.


Online retailers showing the largest increases in the shopper satisfaction
index were HSN.com, and Sony Store, Online, each up 5 points from last year;
LLBean.com and Gap.com, up 4 points; and Target.com, OfficeDepot.com and
Overstock.com, up 3 points each.

Online retailers showing the biggest decreases in customer satisfaction were
JCPenny.com -- down 5 points from 83 last year to 78 -- and Store.Apple.com,
Dell.com and AutoParts Warehouse.com, down 3 points each to an 80, 77
and 75, respectively.


Lowest scores on the list were Fingerhut.com and Gilt.com which both had 72.

The report is based on more than 24,000 customer surveys collected during the
holiday shopping season between Thanksgiving and Christmas. It expanded from
measuring 40 retailers last year to 100 this year.

"This year we're seeing that even some of the largest companies in the
country are at risk if they lose sight of customer satisfaction," says
Larry Freed, ForeSee president and CEO. "Satisfaction with the customer
experience, when measured correctly, is the most important predictor of future
success, and while Amazon clearly gets it, Apple stumbles from their usual
focus on the customer experience and Dell and JC Penney seem to be struggling
to find their way, which could make them extremely vulnerable to
competitors."


As far as Amazon goes, Freed said, "At this point, Amazon has been
dominant for so long and has such a history of focusing on the customer, it's
hard to imagine anyone else coming close. Companies should emulate Amazon's
focus on the customer, which is clearly linked to superior revenues over the
years."

The survey found that highly satisfied shoppers say they are 67% more likely to
consider the company the next time they purchase a similar product. Satisfied
shoppers also report being far more likely to return to the site, recommend it
and stay loyal to the brand, the study found.

A further analysis of the top e-retailers in the U.S. found that, on average, a one-point
change in Website satisfaction was found to lead to a 14% change in revenues
generated online.

Other findings show that highly satisfied visitors to a retail website say they
are 65% more committed to the brand overall, 71% more likely to purchase from
the retailer online and 56% more likely to purchase from the retailer offline.

Regarding JC Penney, the report said the retailer is learning its lesson
"the hard way."

"[JC Penney] suffered the largest drop in customer satisfaction in the
Index because it failed to listen to what its customers wanted," the
report said. "It's no surprise the drop was so large. The company tried to
reinvent itself in the retail space by overhauling the existing pricing and
promotion structure by drastically reducing the number of coupons, special
discounts and sales in favor of everyday low prices. This model works great for
other companies and their customers, but it obviously is not working for JC
Penney shoppers."

The report continues: "If [JC Penney] simply would have listened to their
customers, using credible science and statistical rigor before they went public
with the new strategy, they would have understood that changing pricing and
promotion strategies would not make sense from the consumers'
perspective."


The study says that any retailer falling below a satisfaction score of 78 is
"risking loyalty, recommendations, sales and market share to competitors
with higher scores." Among the online retailers with scores of 77 are
BestBuy.com, Dell.com, EddieBauer.com, gamestop.com,
Gap.com, JCrew.com, Macys.com, NeimanMarcus.com, OfficeMax.com,
RalphLauren.com, Staples.com, and UrbanOutfitters.com.

CVS.com, FootLocker.com, Nike.com and
Toysrus.com are among those with satisfaction scores of 76.

The study states that measuring customer satisfaction beyond just how often
they click on a site is vital to online retailers understanding how to best
reach their potential customers. "While analysts and journalists tend to
focus on the flashier story of whether revenue was up or down, they rarely dig
deeper to uncover the reasons why revenue changed. Using metrics like hits,
clicks and time spent or revenue to determine how well the online retail
industry performed during the 2012 holiday shopping season offers good insight,
but it also leaves many critical questions unanswered. Getting inside the minds
of site browsers and assessing their impressions of their site experience and
satisfaction provide a critical perspective on how to maximize the contribution
of the Website to driving overall sales, customer satisfaction and loyalty both
during the holiday season and throughout the year."

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