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When shopping for a photo printer, 25 percent of consumers indicate price is the most important reason for purchasing a specific brand, followed by printer quality, according to the J.D. Power and Associates 2006 Photo Printer Customer Satisfaction Study.

The inaugural study measures customer satisfaction with photo printers based on five factors that drive overall satisfaction: performance, appearance, connectivity, ease of use and cost. When examining photo printer performance relative to the drivers of overall satisfaction, Kodak and Lexmark perform particularly well among printer brands.

“Price and quality play a critical role in the purchase decision and also have a considerable impact on overall satisfaction once the ownership experience begins,” said Steve Kirkeby, executive director of telecommunications and technology at J.D. Power and Associates. “Generally, consumers have a much more positive attitude toward their photo printer if they believe they received a good deal, which creates a valuable marketing opportunity for retailers’ and manufacturers’ sales channels. By clearly communicating the value and cost-savings in bundling high-quality printers with cameras and their accessories, manufacturers can improve their chances of attracting customers while providing a more satisfying purchase experience.”

The study finds that 25 percent of customers purchase their photo printers through the Internet. Among those shoppers, 27 percent purchase from a retail Web site, 24 percent purchase directly through the brand manufacturer’s site and 9 percent purchase through an online auction site such as eBay. Customers who purchase through the Internet have higher satisfaction levels with their printer (averaging index scores of 801 points on a 1,000-point scale) compared to owners who purchased in a retail store (averaging 779 points).

“Although it is not always the case, customers generally feel that they are able to find less expensive printers online than in a retail store, particularly at online auction sites,” said Kirkeby. “This is further evidence of the critical role price plays in buying a photo printer.”

The study also finds that there is a distinct relationship between overall satisfaction and brand loyalty. Among satisfied printer owners—those who provide an overall satisfaction score of 900 or more index points—52 percent will repurchase the same printer brand. Conversely, only 4 percent of indifferent or disappointed owners—those who provide a satisfaction score of 700 points or less—are likely to repurchase the same brand.

“Our research also shows that if customer satisfaction improves by 25 index points, repurchase intent among owners will, on average, improve by 10 percentage points, which can certainly prove beneficial to manufacturers,” said Kirkeby.

Additionally, while nearly 70 percent of satisfied owners report they would recommend their printer brand to friends and family, only 5 percent of indifferent and disappointed owners indicate they would do the same.

The 2006 Photo Printer Customer Satisfaction Study is based on responses from 2,391 customers who purchased or received a photo printer between July 2005 and July 2006.

Posted under Customer Service, Products

Customer service issues that are handled by a computer automated response system (ARS) on the telephone generate significantly lower customer care ratings when compared with issues handled by a live representative, according to the J.D. Power and Associates 2007 Wireless Customer Care Performance StudySM —Volume 1.

Now in its fifth year, the semi-annual study provides a detailed report card on wireless provider customer care performance based on customer experiences with three point-of-contact methods: telephone calls with a service representative and/or automated response system (ARS); visits to a retail wireless store; and online Internet connection. Within each contact method, processing issues such as problem resolution efficiency and hold-time duration are also measured.

Overall, customers who speak with a service representative on the telephone provide an average index score of 127 points, which is significantly higher than the industry average of 98 points. However, customers contacting their carrier with a problem or inquiring through an ARS system rate their experiences significantly lower, averaging 92 index points. The index score drops even further (to 73 points) for contacts made over the Internet.

“One of the main factors contributing to this performance disparity is the quality of the response that is given,” said Kirk Parsons, senior director of wireless services at J.D. Power and Associates. “A service representative—either over the phone or in person—has the ability to answer customer questions and clarify answers. This flexibility is very limited in both ARS and Internet contact methods.”

In addition, scores for the ARS contact method have decreased 5 percent to 92 index points in overall performance when compared to the most previous reporting period six months ago (97 points). The largest declines were reported for customers experiencing too many prompts before getting to the desired menu and the lack of relevant menu options available to address the customer’s inquiry.

“As more companies strive to save operating costs by encouraging customers to contact Internet- and computer-based customer service programs, they run the risk of increasing the rate of customers who will switch carriers, especially as the number of contacts needed to resolve issues rises,” said Parsons. “Since future churn levels are four times as high among those who rate their wireless carrier below average in customer care, the challenge for wireless providers is to offer an easy and efficient customer care transaction experience.”

For a fifth consecutive reporting period, T-Mobile ranks highest among the five largest wireless service providers by creating a positive experience among customers who contact the carrier for service or assistance. With an index score of 107 points, T-Mobile performs well across all factors that determine overall satisfaction, particularly in the ARS and retail contact channels, and in the overall hold-time duration on the phone. Verizon Wireless (101) and Alltel (99), respectively, follow T-Mobile in the rankings.

The study also finds several key wireless customer care patterns:

* More than one-half (55%) of wireless users have contacted the customer service department for assistance within the past year, marking a nearly 7 percent decline from the most recent reporting period (July 2006).
* The average number of contacts necessary to resolve an inquiry by phone is 1.87—up from 1.76 in the previous reporting period.
* Among customers who contact their provider, 73 percent do so by telephone and 24 percent do so through their provider’s retail store. E-mail/Internet accounts for only 3 percent of customer contacts.
* The average initial reported hold time on calls to the customer service department is 3.58 minutes. In comparison, it takes an average of 8 minutes before speaking in-person to a representative at one of the provider’s retail stores.
* More than four in 10 customers (42%) contact their provider with a billing-related service inquiry, with 55 percent of these contacts attributed to inaccurate charges. Additionally, 30 percent of all customer care inquiries are call-quality related.

The 2007 Wireless Customer Care Performance Study—Volume 1 is based on responses from more than 13,970 wireless customers who contacted customer care within the past year. The results are from the past two reporting waves, conducted in June and September 2006. The 2007 Volume 2 report will be issued in July 2007.

Posted under Customer Service

Wireless users who have problems or issues with service need to contact their current provider more often than in the past in order to resolve the inquiry, according to the J.D. Power and Associates 2006 Wireless Customer Care Performance StudySM – Volume 1 released today.

The study, in its fourth year, now provides a detailed report card on a semi-annual basis of wireless provider customer care performance based on customer experiences with three point-of-contact methods: telephone with a service representative and/or automated response system (ARS); walk-in at a retail store; and online Internet connection. Within each contact method, processing issues such as problem resolution efficiency and hold-time duration are also measured.

The study finds that wireless customers contact their provider an average of 1.94 times by phone to resolve an issue or problem—the highest level since measurement began in 2000. Since that time, the average problem resolution frequency (PRF) rate has steadily climbed.

In 2000, the average PRF rate was 1.36—a yearly increase of 14 percent. The main factors contributing to this increase in resolution frequency are not only the rise of new wireless services and products that are available, but also the complexity of using those products. Now customers can capture still pictures or video, download ring tones, play MP3 files, and even watch TV clips. This, in turn, puts pressure on the carrier’s service representative to understand the issue or problem and try and get the inquiry resolved in a timely manner.

“As more wireless companies encourage customers to try new services, it’s becomes more difficult for the customer service representatives to be fully trained and kept apprised on the latest products being introduced. The downside is the carrier runs the risk of decreasing customer satisfaction and losing customers to other carriers,” said Kirk Parsons, senior director of wireless services at J.D. Power and Associates.

“Since future switching levels are three times as high among customers who need to re-contact the carrier two or more times to get the inquiry resolved, the challenge for wireless providers is to provide contact channels that can offer an informative and efficient experience for their customers.”

For the third consecutive reporting period, T-Mobile ranks highest among the five largest wireless service providers in creating a positive experience for customers who contact their providers for service or assistance. With an index score of 108, T-Mobile performs particularly well across all factors, especially among the contact channels of customer service representatives, ARS and walk-in retail experience. ALLTEL and Verizon Wireless follow T-Mobile in the rankings in a tie, performing significantly above the industry average (104).

The study also finds several key wireless customer care patterns:

More than one-half (52%) of wireless users have contacted the customer service department for assistance within the past year, a slight decrease from 2005 (54%).

Among those who contact their carriers, 71 percent do so via telephone and 25 percent through their carrier’s retail stores. E-mail/Internet contacts account for only 4 percent.

The average initial reported hold time on calls to the customer service department is 3.57 minutes—an increase from 3.44 in 2005. In comparison, it takes, on average, more than 9 minutes before speaking to a representative at a retail store.

More than four in 10 users (42%) contact their carrier with a service inquiry that is billing related, one-half of which are due to incorrect charges. An additional one-third of all customer care inquiries are call quality related.

The 2006 Wireless Customer Care Performance Study-Volume 1 is based on responses from more than 11,490 wireless users who contacted customer care within the past year. The results are from the past two reporting waves, conducted in July and October 2005. The 2006 Volume 2 report will be issued in July 2006.

Posted under Customer Service

Patient perceptions of a hospital’s reputation plays an important role in hospital selection, according to the J.D. Power and Associates 2005 National Hospital Service Performance StudySM released today.

The study, which measures satisfaction among recently discharged hospital patients, finds that three-fourths of patients use reputation-related information as their primary criteria in selecting a hospital. Nearly one-half (48%) of patients say that the hospital’s overall reputation was their primary criterion for selection, while 25 percent say the availability of good doctors and having skilled nurses on staff was most important in their selection.

“Perception plays an important role in the choices today’s healthcare consumers make,” said Steven D. Wood, senior vice president and general manager of the healthcare practice at J.D. Power and Associates. “More than ever before, patients have a choice for their healthcare providers, and this choice depends a great deal on the personal services rendered at a highly emotional time in their lives. As patient choices increase, hospitals need to continue to enhance the clinical and experiential quality of patient care and effectively communicate their performance in the communities they serve.”

The study finds that 59 percent of respondents whose hospital stay was planned indicate that they were involved in the hospital selection decision either solely or with a doctor, while only 8 percent felt they were constrained by what their health plan would allow. Among patients who were “delighted” with their hospital experience (providing a score of 10 on a 10-point scale), a strong majority (86 percent) say they are likely to choose the same hospital in the future should the need arise, and 83 percent would recommend the hospital to others.

The study measures overall patient satisfaction in five categories: dignity and respect; speed and efficiency; comfort; information and communication; and emotional support.

Patients overall are very satisfied with the service they received during their most recent hospital stay, with 74 percent of patients giving the hospital high ratings regarding their hospital experience. Hospitals receive the highest ratings from patients in the area of dignity and respect, which includes the courtesy of doctors and nurses and the hospital personnel’s respect for privacy. Conversely, patients have consistently given hospitals the lowest ratings for speed and efficiency, with only 36 percent of patients indicating they were delighted.

Hospital patients who are 66 years old and older report much higher levels of satisfaction than do younger patients. Forty-two percent of patients 66 years old and older report being delighted with the overall hospital service experience, compared to 25 percent among patients 18 to 45 years old and 31 percent among patients 46 to 65 years old. The proportion of patients who indicate they are delighted is lowest among childbirth patients (26%), compared to medical (35%) and surgical (34%) patients. Patients living in a rural area are more likely to be delighted as compared to patients living in an urban area (38% of rural patients are delighted compared to 32% of urban patients).

The 2005 National Hospital Service Performance Study is based on responses from approximately 2,500 patients who stayed in a hospital for at least one night within the previous three to nine months of being surveyed.

Posted under Health

Bose achieves the highest brand power score among audio manufacturers for a third consecutive year, according to the J.D. Power and Associates 2005 Automotive Component Branding Study released this month.

Brand strength in the market is measured by assessing consumers’ top-of-mind awareness (unaided awareness), brand name/logo recognition (aided awareness) and favorability (impression). High brand power scores indicate positive impressions and strong awareness among consumers.

With a combination of strong consumer awareness and favorability, Bose ranks highest in the study, receiving the highest brand power score. Sony follows Bose in the rankings, receiving both strong top-of-mind and aided awareness among consumers. Pioneer, which receives high ratings in unaided awareness, follows Sony in brand power. Dolby performs well in the area of favorability and Panasonic performs well in aided awareness to rank fourth and fifth, respectively. Although Dolby is not a manufacturer of end-use consumer products, its technology is common in many facets of audio entertainment and is employed by the majority of audio equipment manufacturers.

While superior sound quality is important to consumers, brand name still commands a premium. The study finds brand strength plays an integral part in how much consumers are willing to pay for upgraded or premium audio systems. An upgraded audio system might include a satellite radio-ready AM/FM/in-dash six CD player/changer with eight speakers. A premium audio system might additionally include eight to 14 speakers plus surround sound.

Consumers who would purchase an upgraded system report they would pay $358 on average for a non-branded system, and 87 percent say they would pay more for a brand name system. Additionally, consumers who would purchase a premium audio system report they would pay, on average, $616 for a non-branded system. Ninety-three percent say they would be willing to pay more for a brand name system. Within both upgrade and premium audio options, Bose is cited most often as the brand consumers would be willing to pay an additional amount to own.

“When we asked consumers about the importance of branding, one-third believe it is important to know the brand of the AM/FM CD player/changer in their vehicle,” said Larry Wu, senior director of automotive emerging technologies at J.D. Power and Associates. “Consumers associate certain brand names with a specific level of quality.”

Other automotive component brands that have achieved high awareness ratings include OnStar, Sirius Satellite Radio and XM Satellite Radio. Consumers associate OnStar with safety, security and reliability/dependability. Sirius and XM are associated with being widely available and innovative.

“These component brand names are becoming more recognizable to consumers with the increase of factory installations into new vehicles and heavy promotion in the media,” said Wu.

The 2005 Automotive Component Branding Study is based on a Web-based survey of nearly 7,500 consumers who purchased or leased a new vehicle in the past six years.

Posted under Products

Cox ranks highest in satisfying high-speed Internet customers, while SBC Yahoo! ranks highest among dial-up Internet providers, according to the J.D. Power and Associates 2005 Internet Service Provider Residential Customer Satisfaction Study(sm) released yesterday.

Now in its eighth year, the study measures customer satisfaction with Internet service providers based on seven factors. They are: performance and reliability; cost of service; image; customer service/technical support; billing; e-mail services; and offerings and promotions.

Cox records the most improvement in the study, increasing 20 index points from 2004. Cox receives the highest ratings in the high-speed segment in performance and reliability and customer service. Following Cox in the rankings are Verizon, BellSouth and Bright House, respectively.

SBC Yahoo! receives particularly strong ratings from its dial-up customers in offerings and promotions and cost of service. SBC Yahoo! is followed in the rankings by AT&T Worldnet and EarthLink, respectively.

The study finds that dial-up accelerators are having a big impact on the number of hours dial-up users spend online. Overall Internet usage among dial-up customers has increased from 15.6 personal hours per week in 2004 to 17.8 in 2005. Among those using dial-up accelerators, Internet usage averages 19.9 hours—10 percent higher than broadband users, who average 18.1 hours per week. Customers using dial-up accelerators also report spending less on Internet service than the dial-up average—$19.35 per month compared to $20.04 for all dial-up users. Reflecting increasingly competitive pricing, high-speed users report spending less on average in 2005—$43.83 per month in 2005, down from $44.12 in 2004.

“Speed is the name of the game in the Internet world, and customers who use accelerators are more likely to switch to broadband products like DSL and cable modem down the road,” said Steve Kirkeby, senior director of telecommunications research at J.D. Power and Associates. “With nearly one-third of dial-up users saying they intend to switch to a high-speed connection in the next six months, dial-up accelerator users are more likely to switch to their current providers’ high-speed product, retaining them as customers for the long term.”

Although DSL subscribers are significantly more satisfied than cable modem users for a second consecutive year, cable modem providers are increasing market share at a faster pace than DSL. In 2005, cable modems account for 28 percent of Internet subscriptions—up from 24 percent in 2004. Sixteen percent of Internet service subscriptions are for DSL service—up just 1 percent from 2004. However, among the 32 percent of dial-up subscribers who say they will definitely or probably switch to high-speed in the next six months, 47 percent intend to go to DSL. Only 30 percent intend to switch to cable modem.

High-speed subscribers are more price sensitive than dial-up in deciding when and where to switch, whereas connection speed is much more important for dial-up than high-speed subscribers. The effects of discounted packaging of services are also evident, with this issue having factored into the decision of 62 percent of subscribers who switched to high-speed versus 39 percent to dial-up.

“Price competition among high-speed providers is increasingly prevalent,” said Kirkeby. “Although service interruption is considered by more than one-half of high-speed service subscribers as important, price is the No.1 reason to switch. Long term, however, product performance will be the main reason they stay.”

The 2005 ISP Residential Customer Satisfaction Study is based on responses from 6,313 residential customers of Internet service providers nationwide.

Posted under Customer Service

SunTrust Mortgage ranks highest in customer satisfaction among home mortgage servicing companies, according to the J.D. Power and Associates 2005 Primary Mortgage Servicer Study released this month.

The inaugural study measures customer satisfaction with the nation’s largest mortgage services based on performance in four primary areas: billing, payment, annual account review/administration, and customer-initiated interaction.

SunTrust Mortgage performs particularly well in the areas of billing, payment and account review/administration. SunTrust is followed in the rankings by World Savings Bank, Bank of America and Countrywide Home Loans, respectively.

“With climbing interest rates suppressing refinance activity, customer recommendations to others has become even more vital to mortgage lending companies,” said Jeremy Bowler, senior director of the finance and insurance practice at J.D. Power and Associates. “Throughout our research, we find that customers who are satisfied with their lender are considerably more likely to offer a personal referral to a friend, co-worker or relative, illustrating the strong relationship between customer satisfaction and long-term customer value.”

The billing and payment factors are the two most important and highest-rated aspects of the customer experience with the company that services the mortgage. In these areas, customers place the strongest importance in the accuracy of posting payments as well as the variety of payment options.

The study finds that while only 20 percent of customers pay their mortgage online, those who pay online or through automatic deductions rate their lenders significantly higher overall than customers paying by mail or phone. Furthermore, customers who currently receive an online bill notification are among the most satisfied overall, yet only 6 percent indicate they take advantage of this option.

“In our increasingly electronic world, consumers are always looking for ways to save time in paying their monthly bills,” said Bowler. “However, more customers say they would like to pay or receive their mortgage bill online than actually do so, despite existing options available to most borrowers. Given the high impact that the perception of payment options has on overall brand impression, increasing customer awareness of payment options is an area of opportunity for servicers to distinguish themselves in the marketplace.”

For the industry as a whole, more than one borrower out of every 10 who contact their lender indicate the service representative they dealt with did not speak clearly.

“By far the most common cause of this complaint is poor articulation of words,” said Bowler.

“Customers who had difficulty hearing what the service representative was saying rated their experience very poorly—more than 300 index points lower than those customers who indicate they had no difficulties comprehending the representative they spoke with.”

The 2005 Primary Mortgage Servicer Study is based on responses from 9,214 home mortgage customers. J.D. Power and Associates now conducts three studies related to the mortgage lending experience.

Posted under Finance

With a CSI score of 915 (on a 1,000-point scale), Lincoln ranks highest in customer satisfaction with dealer service, receiving a record-setting high CSI score for the second consecutive year, according to the J.D. Power and Associates 2005 Customer Service Index (CSI) StudySM released July 21.

The study, now in its 25th year, measures customer satisfaction of vehicle owners who visited the dealer service department for maintenance or repair work during the first three years of ownership, which typically represents the majority of the vehicle warranty period. Overall customer satisfaction is based on six measures: service initiation, service advisor, in-dealership experience, service delivery, service quality and user-friendly service.

Lincoln outperforms other brands in the areas of service initiation and user-friendly service. Lincoln customers are particularly pleased with the dealership’s ability to get them in for an appointment within a reasonable amount of time and the fairness of charges. Lincoln is the first domestic make to rank highest in CSI for two consecutive years.

Lincoln is followed in the rankings by Cadillac, Saturn and Lexus, respectively.

The study finds that 51 percent of repair work involved a recall—up from 39 percent in 2004—reflecting, in part, a change in government regulations on mandatory reporting of vehicle safety defects. CSI scores are, on average, considerably higher for repairs that involve recalls, particularly in the area of service quality. Recall work often tends to garner higher satisfaction than typical repairs because dealers plan for and communicate the work to customers better. As recall repairs become routine, technicians become more efficient and consistent in fixing the problem.

“As negative as recalls are for manufacturers, they provide dealerships with opportunities to excel in service and make a positive impact on their customers,” said Steve Witten, executive director of automotive retail research at J.D. Power and Associates. “When a vehicle is fixed quickly and correctly in one visit, customers tend to walk away with higher satisfaction. This typically occurs with recall work since the dealers are prepared to work on the specific problem. Manufacturers may consider applying lessons learned from recall campaigns to regular repair service.”

The study also finds that brands receiving high ratings from customers for service satisfaction benefit as well in terms of loyalty, both in the likelihood of customers returning to the dealer for in-warranty and post-warranty work and in intentions to repurchase from the servicing dealer. This is particularly important when the warranty period ends. Creating strong relationships with customers during the first few years of ownership significantly influences customer retention during the post-warranty period, according to the J.D. Power and Associates 2005 Service Usage and Retention StudySM (SURS), which measures the same elements as CSI but at four to five years of ownership, when most warranties have expired.

“After one year of ownership, nearly one-third of customers turn to non-dealer facilities to service their vehicle,” said Witten. “This percentage increases to more than one-half by the time the vehicle is five years old. What we find in SURS is that many independent service providers maintain a competitive advantage over dealers primarily through the strong relationship and trust they have developed with their customers. While most independents have the advantage of being small operations that offer more personal service, manufacturers and dealers can develop programs that foster personal relationships between service advisors and customers.”

According to SURS, independent service providers typically outperform dealers in the key drivers of service satisfaction, including getting customers their appointment on the desired day; waiting on customers immediately; telling customers when their vehicle will be ready and consistently delivering on that promise; fixing the vehicle right the first time; and explaining the work performed and associated charges.

Brands that perform particularly well in service satisfaction among owners of four- to five-year-old vehicles include luxury brands Acura, Cadillac, Infiniti and Lexus.

The 2005 CSI Study is based on responses from 99,550 owners and lessees of 2002 to 2004 model-year vehicles. The 2005 SURS is based on responses from 11,016 owners of 2000 to 2001 model-year vehicles.

Posted under Automotive