Customer satisfaction with products and services is at a 10-year high, concludes a quarterly survey being released today.
The survey by the University of Michigan Business School, part of its annual study of how more than 80,000 customers rank their experiences with about 200 companies, rates the package delivery service business highest in satisfaction. Customers took less pleasure in industries such as cable television, wireless telephones and airlines, where Comcast Corp., Sprint PCS Group and US Airways Group Inc. had the lowest customer satisfaction.
According to the national survey, customer satisfaction for the first three months of 2004 was at the highest level since 1994, at 74.4 on a 100-point scale. That's up from 74 from the last quarter of 2003. Survey Director Claes Fornell called the findings "remarkable since we hear so many complaints about the level of customer service."
He attributed the improvement to the economy. "Many companies have been forced to try harder to please customers in order to generate more revenue," Fornell said in a statement. And job insecurity has helped firms achieve that goal, he said. "When people are insecure about their employment situation, they are likely to try harder and demand less."
Each quarter, the survey focuses on different segments of the economy. This quarter, the survey measured how well communications, transportation and utility firms dealt with their customers.
By far, the industry with the highest rating was the package/express delivery service industry, with a score of 81, up from 79 last year. FedEx Corp. remains the leader, with a score of 83, but UPS of America Inc., at 80, and the U.S. Postal Service's package and express mail service, at 77, were not far behind. In fact, the postal service is steadily closing the service gap with FedEx; 10 years ago, it was 16 points behind.
And despite all the criticism about health care, patient satisfaction with hospitals increased 4.1 percent to give the industry a score of 76, its highest ever. No specific hospitals were cited.
On the other extreme, the industry with the lowest rating was the cable/satellite TV industry, which received an overall rating of 61, down from the year 2000 when it was first included in the survey and received a score of 64. "Customer satisfaction has gone from bad to worse and there is no improvement in sight," the survey said. Individually, the firms with the lowest scores were Comcast and Charter Communications, both registering a 56 rating. While that was nearly 2 percent higher than last year, it was more than 11 percent below their 2000 ratings.
"That's a little below terrible," Fornell said in a telephone interview. Few companies ever score below 60, another survey official said.
Comcast Executive Vice President David N. Watson said the company has been "dramatically upgrading our network, and this causes a certain amount of disruption of service. Once the upgrades are completed, we expect the level of service to improve and expect our scores to improve." Watson added that the company has recently launched a new "think customer first" campaign to keep consumers from going to competitors, such as satellite TV firms, which fared better in the satisfaction survey.
Wireless telephone firms, included in the survey for the first time this year, received an overall industry score of 65. "We knew they were bad, but not sure we really knew it was this bad," Fornell said. The best rating went to Verizon Communications Inc., the worst to Sprint PCS.
For land-line telephone firms (both local and long distance), Sprint also received the lowest rating while AT&T Corp. won the highest, with Verizon and MCI Inc. close behind. Overall, the industry had a score of 71, a modest 1.4 percent drop from 2003 but a 12.3 percent drop from 1994.
Sprint spokesman Dan Wilinsky said the company has recently introduced a number of new programs to "address the customer. Customer service is our number one priority."
The airlines continued to disappoint passengers, the survey said. It noted that satisfaction fell 1.5 percent from 2003 to a score of 66, as Americans started traveling again and the crowds put strains on the airlines. Southwest Airlines Co. remains the top-performing airline, despite a two-point drop from 2003 to 73. US Airways' score was the worst: 62, down 3.1 percent from last year. The survey predicted service won't get much better if airlines continue to focus on cutting costs.
US Airways issued a statement saying it has "not seen any spike in consumer complaints as suggested by this survey."
Meanwhile, higher energy prices and lingering ill will from Hurricane Isabel affected the satisfaction ratings of local utilities Pepco Holdings Inc. and Dominion Resources Inc. Both dropped more than 6 percent , Pepco to 72, Dominion to 67.
"It's not a surprise," said Pepco spokesman Robert Dobkin. "We're concerned and we're working harder to earn the confidence of our customers, taking new measures to deal with storms" and provide more reliability and information during emergencies.