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American Customer Satisfaction Index up 0.9%

BY CSA STAFF

ANN ARBOR, Mich. The American Customer Satisfaction Index climbed to 75.7 on the ACSI’s 100-point scale, up 0.9% from the previous quarter.

“For consumer spending to rebound, two conditions must be met: consumers must be favorably disposed to spend and have the means to spend,” said Professor Claes Fornell, head of the ACSI and author of The Satisfied Customer: Winners and Losers in the Battle for Buyer Preference.

“The good news from ACSI is that the first condition has been met: customer satisfaction is looking up. But it remains to be seen to what extent the government stimulus plan will help translate stronger satisfaction into increased consumer demand.”

Customer satisfaction with the retail sector, which includes department and discount stores, specialty retail stores, supermarkets, gas stations, and health and personal care stores, gained1.3% to 75.2.

Among department and discount stores, Nordstrom and Kohl’s led with an ACSI score of 80, the former on the strength of its customer service, the latter for its superior value. Deep discount store Dollar General drops 4% to score of 75, not from a decline in service, but from a migration of a higher socio-economic group of consumers to the retailer – another effect of the recession – a group that tends to be harder to please.

Discount store giant Wal-Mart had mixed results, falling 4%for its supermarket business to an ACSI score of 68, well below the industry average, but rising 3% for its non-grocery discount business to 70. Wal-Mart’s Sam’s Club also rises 3% to 79.

In the specialty retail category Home Depot climbed 5% to an ACSI score of 70, matching its best result in four years. However, the improvement failed to lift Home Depot from the bottom of the industry, and the home improvement retailer still trails rival Lowe’s (76) by a wide margin. Office Depot moved in the opposite direction, falling 4% to 75 amid store closings and layoffs.

Supermarkets were unchanged with an ACSI score of 76 even though food prices remain high. Publix was on top with a score of 82, the fifteenth straight year the supermarket chain has led the category. Safeway gained 4% to 75, its highest score since 2002.

The ACSI score for e-commerce fell 2% to 80. Online retail declines 1.2% to 82, driven mostly by drops for Amazon and eBay. But with a small dip, Amazon (-2% to 86) remains the second highest scoring firm of all companies in this release. The situation for e-Bay is different. Its ACSI score slumped 4% to 78, an all-time low.

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JCPenney to sponsor Rascall Flatts tour

BY CSA STAFF

PLANO, Texas JCPenney announced that it is the official sponsor of the “Rascal Flatts American Living Unstoppable Tour” presented by JCPenney. The tour will promote American Living, the retailer’s affordable, all-American lifestyle brand developed exclusively for the JCPenney customer by Polo Ralph Lauren’s Global Brand Concepts. The fully integrated two-year sponsorship will kick off June 5, with the tour hitting approximately 60 cities across the nation each year.

In conjunction with the tour, Rascal Flatts has written a new song inspired by the spirit of the brand titled “American Living,” which will serve as the soundtrack for the new American Living commercial. The song will only be available on a special version of the Unstoppable CD sold at JCPenney stores.

“Representing true Americana, Rascal Flatts’ music transcends genres and resonates strongly with our customers – the more than half of America that shops at JCPenney each year,” said Mike Boylson, chief marketing officer for JCPenney. “With Rascal Flatts’ significant crossover appeal and passion for the brand, our fully integrated sponsorship of ‘Rascal Flatts American Living Unstoppable Tour’ is a perfect canvas to highlight American Living and its true American values.”

The new Rascal Flatts song “American Living” will be available exclusively on a special version of their new Unstoppable album, to be sold at JCPenney beginning on April 7. All net proceeds from the sale of albums will be donated to the JCPenney Afterschool Fund, which provides children in need with access to life-enriching afterschool programs that inspire kids to be smart, strong and socially responsible.

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Borders cuts more jobs

BY CSA STAFF

ANN ARBOR, Mich. Borders Group announced that it has reduced its corporate work force by another 136 positions, which were eliminated effective Feb. 19. The majority of the jobs, which represent about 12% of the corporate work force but less than 1% of the company’s total work force, are based at the company’s headquarters in Ann Arbor.

According to the company, the work force reduction was spread across virtually all business areas, including marketing, human resources, field management and corporate sales. The reductions were made at various ranks, ranging from entry level to middle management. Affected employees are being offered transition pay, severance and job placement assistance.

“While reducing payroll is never easy and we respect the impact it has on employees and their families, it is one of the necessary steps we must take along with other non-payroll expense reductions to help get this company back on track financially,” said CEO Ron Marshall. “In this time of transition, I greatly admire the tenacity and focus that employees at all levels here have shown as we drive to significantly reduce expenses and bring other key financial measures in line. We will continue to move forward with deliberate speed to make the changes required to get Borders back on firm financial footing.”

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