Study Reports Drop in Customer Satisfaction

A study released today by ForeSee Results Inc. shows that more than half of online holiday shoppers were highly satisfied with their online experience this year. However, the still-nascent e-retail industry earned an overall score of 69 out of a possible 100 points, which is an eight point drop from last year's rating. ForeSee says the drop is a strong message from consumers that retailers need to do more to keep customers coming back throughout the year. The study applied the same methodology and rating scale used by the University of Michigan's American Customer Satisfaction Index (ACSI). The overall e-retail industry rating of 69 is the product of a formula that takes user satisfaction into account, along with a variety of features and functions (browsing capability, privacy, ease of returns, etc.), and adjusts for how significantly each component affects things like purchase behavior and loyalty. This year's score of 69 is eight points lower than the 2001 ACSI e-retail index, and four points lower than the ACSI retail index for traditional channels, ForeSee says. According to ForeSee, 10 percent of online shoppers were extremely dissatisfied with their online experience. Of those who are not satisfied, two thirds do not plan to shop online next year. "These do not seem like big numbers, but they are really significant in terms of dollar amount, as one point on the scale equals roughly $275 million in retail sales." says Errol Hau, director at ForeSee. Hau attributes the drop to new users coming to the Web with high expectations after buying at sites like Amazon.com, which excel in their Web offering. "Once those expectations are set, the satisfaction level will drop overall as users go to other, less organized sites," Hau says. However, there is some good news for retailers: according to the study, 59 percent of online shoppers said they were highly satisfied with their experience, while 71 percent said they are very likely to do their holiday shopping online next year. In addition, 69 percent said they were very likely to recommend the experience to others, and 63 percent of the surveyed online shoppers said they are very likely to shop online again within the next two months. According to the study, holiday-time satisfaction levels also determine consumers' future behaviors, thus e-retailers that understand the components and drivers of customer satisfaction will be highly rewarded. Satisfied consumers are 50 percent more likely to make online purchases again within two months, ForeSee says, which gives the e-retail industry a powerful incentive to improve satisfaction and thereby ensure that business keeps coming its way throughout the year. Hau says that the best way to improve an e-retail site is to provide better order-processing and product-browsing capabilities to consumers. These capabilities should include searches based on product availability and a product's user-satisfaction levels, among other features. "Better browsing offers greater convenience, as customers no longer have to go to 10 different stores to compare prices and features," Hau says. Lauren Ramos, director of the Giga Information Group, says user-friendly search technology can only be a good thing. "It's like having a smart salesperson who knows the ropes available all the time, and this technology is always less expensive than hiring an actual person," Ramos says.