Online Customers: Amazon, Apple Bring Happiness, Netflix Frustration
In the virtual world of online shopping, where there are no smiling salespeople, no ambiance of light and music, no way to physically touch a product prior to purchase, retailers have to find other ways to stand out from the competition and build a loyal customer base. Satisfied customers will return to buy more and tell their friends, family and colleagues to visit a good e-retail site for future purchases.
Sales and revenue are good indicators of retail success, but ForeSee Results annual holiday polls offer insight on overall customer satisfaction, which can lead to long-term economic stability and profitability. The company, which created the consumer satisfaction pop-up box that online shoppers see when they log onto a retailer, released their 2011 findings yesterday. Satisfaction results are based on four key components in online retail success: content, functionality, merchandise and price.
Polling has helped the e-commerce industry greatly. Since studies began in 2005, the average customer satisfaction score for the index has increased from 74 to 79, but this year there are still some clear winners and losers among the top 40 e-retailers.
Topping the charts with customer satisfaction? Retail giant Amazon.com, with an 88% happy customer rating. QVC, Apple and Vistaprint are three of the other fourteen companies with "excellent" scores, with over 80% customer satisfaction.
Along the other end of the spectrum, Overstock.com and Gap failed to satisfy, with the lowest ratings among the 40 major American e-retailers. They came in at 72% and 73% respectively.
What does a 16% variance between the top and bottom retailers mean? A lot, according to ForeSee Results. A 1% increase in a company's customer rating translates to an average 14% increase in revenue, and vice versa. That's huge. The reason? Repeat purchases and word of mouth.
Perhaps this biggest surprise to come out of the ForeSee study was that despite a country in the economic doldrums, price had a smaller impact on customer satisfaction than last year. Rather than cutting price points, retailers who invested in improved merchandise and web content saw the highest levels of customer satisfaction.
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