Publix leads all retailers in customer satisfaction, followed by Amazon and Office Depot
Ann Arbor, Mich. — Customer satisfaction with retailers is on the rise, according to a report released by the American Customer Satisfaction Index. In fact, it’s at an all time high, up 0.7% to 76.6 in 2012 on ACSI’s 100-point scale. And once again, Publix is on top, outperforming all other retailers (physical and pure online players) with a score of 86.
By category, overall satisfaction with department and discount stores increased 1.3% to 77. Nordstrom led the category at 84, followed by J.C. Penney, Kohl’s, and Target, all of whom scored 81. Walmart was once again at the bottom (+1% to 71).
“A big part of Wal-Mart’s challenge is that it is no longer the only game in town when it comes to discounting,” said Claes Fornell, ACSI founder. “Twenty years ago, Wal-Mart was able to beat the industry average for customer satisfaction — not because merchandise quality was better, but because it was close enough to, or on par with, competition and it had the low-price market essentially to itself. According to customers, neither is true today.”
Supermarkets showed an ACSI benchmark of 77 in 2012, up 1.3% since 2011.
Among grocers (and all other retailers), Publix reigns supreme when it comes to customer satisfaction, just as it has done in every year since the ACSI’s inception in 1994. In 2012, Publix gained 2% to a score of 86, widening the gap with Whole Foods Market, which has leveled off at 80 following four straight years of gains. Kroger is unchanged at 79, followed by Winn-Dixie, up 4% to 78.
Office Depot led the specialty sector, up 6% to 84, followed by Costco Wholesale Club, unchanged at 83.
On the e-commerce side, satisfaction with online retail rose 1.2% over last year to 82. Amazon continues to lead the sector despite a 1% drop to 85, followed by Newegg at 84 and eBay at 83.
“By and large, Internet retail remains a more amiable way of shopping for a variety of merchandise,” Fornell said. “It is worth noting, however, that there are exceptions to the rule. The cream of the crop in traditional retail — Publix, Nordstrom, Office Depot and Costco — all outperform the average customer satisfaction benchmark for Internet retail.”
Founded at the University of Michigan’s Ross School of Business, the ACSI is a national economic indicator of customer evaluations of the quality of products and services available to household consumers in the United States. The ACSI uses data from interviews with roughly 70,000 customers annually as inputs to an econometric model for measuring satisfaction with more than 230 companies in 47 industries and 10 economic sectors, as well as over 100 services, programs, and websites of federal government agencies.
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Abercrombie & Fitch names EVP stores
New Albany, Ohio — Abercrombie & Fitch Co. announced the promotion of Amy Zehrer to the position of EVP stores, from SVP, effective immediately.
Zehrer has been with Abercrombie & Fitch since 1992; she joined as a manager-in-training at the brand’s Rosedale Mall location in Roseville, Minn. Over the last 21 years, Zehrer has proven herself as a definitive leader, evolving the Abercrombie & Fitch brand and playing an integral part in the success of its international expansion, the company said.
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Report: Consumers still frugal; shopping less channels
Chicago — Shoppers will reduce the number of channels they visit and remain intensely focused on value in 2013, according to the latest research from SymphonyIRI Group.
According to Symphony’s “2012 CPG Year in Review: Finding the New Normal,” consumers are still attempting to ease budgetary strains and are embracing a wide variety of money-saving strategies.
“For 2012, we forecasted that shoppers would continue to define value largely based on price, manufacturers and retailers would pass ongoing commodity price increases on to the shopper, and private label sales would continue in their current ranges,” said Piyush Chaudhari, president of the Americas, SymphonyIRI. “These predictions largely came to pass, and we expect 2013 to resemble these same trends in many ways.”
SymphonyIRI predicts shoppers will remain frugal in 2013, even though there will be continuing signs of economic recovery and strengthening. In addition, the following trends identified in 2012 will continue in 2013:
- Shoppers will reduce the number of channels they visit. Share of consumers shopping at fewer than five channels grew three percentage points between first quarter and fourth quarter 2012, and SymphonyIRI believes this will continue as shoppers limit spending to channels that are perceived as offering the best value.
- While an increasing number of positive economic signs are emerging, count on shoppers to remain intensely focused on value. Millennials are becoming the new baby boomers. They are a 50-million-strong-shopping group now forming habits and loyalties. Tailoring offerings to this group and providing outstanding service will pay dividends for decades to come, both literally and figuratively.
- “New” media is rapidly becoming traditional media. The trend of shoppers leveraging the Internet for information and deals is growing and will continue to gain momentum, as millennials age and a new generation that is even more tech savvy than the millennial generation enters the market.
To effectively compete in 2013, CPG manufacturers and retailers should consider the following action items:
- Identify opportunities and risks: Retailers should use value-oriented pricing and promotion programs to protect and grow share, particularly across categories that are most closely aligned with the needs and wants of key shoppers. Manufacturers should closely track the evolving competitive set at the channel and retail level, including traditional brick-and-mortar as well as the online arena, to ensure appropriate alignment of distribution strategies.
- Evaluate pricing and promotional strategies: Retailers should adopt everyday pricing strategies that underscore their value proposition and rely on promotional pricing to address short-term tactical opportunities. Manufacturers should continually re-assess and adjust pricing to maintain optimal price gap between private label and name brand offerings.
- Enhance new product development initiatives: Retailers should explore opportunities to partner with manufacturers to develop complementary national and private label assortments across categories. Manufacturers should constantly evaluate product development opportunities at the value and premium ends of the spectrum, including those that address key consumer trends.