Index: Consumers Dissatisfied With Online Retailers

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Consumer satisfaction with many of the top retail Web sites dropped over the holiday season, according to a study released yesterday by ForeSee Results and FGI Research.


The Top 40 Online Retail Satisfaction Index compares online shopper satisfaction -- whether a purchase was made or not -- between the holidays and the rest of the year. The index was launched in the spring and uses the methodology of the University of Michigan's American Customer Satisfaction Index to determine the scores. The Web sites highlighted in the study are the top 40 retailers in Internet Retailer Magazine's Top 400 Guide.


Despite the holiday increase in online revenue, overall satisfaction fell 4 percentage points from spring 2005 to holiday 2005, the study found. High satisfaction scores -- how happy people are with all aspects of visiting a site -- have proven to correlate to their likelihood to return, make a purchase and recommend the site.


Results include:


· Of the top 40 online retailers measured for the index, all but four had lower customer satisfaction scores during the holidays than in the spring.


· The highest scoring retailers were Netflix, Amazon, L.L. Bean and QVC, which each scored 80 or higher.


· The lowest scoring sites were CompUSA.com with a 67, Kmart with a 68 and Sears with a 68.


· The sites with the biggest drop from the spring to holiday season were ToysRUs.com, which fell 10 percentage points; OldNavy.com, 9 points; Sears.com, 8 points; and JCPenney.com, 8 points.


· Buy.com was the only company to experience an increase, scoring a 71 in the spring and 72 over the holidays.


Part of the problem is the numerous first-time and infrequent visitors to sites over the holidays, ForeSee president/CEO Larry Freed said in a statement.


"During the holidays, it's more important than ever to do a good job at meeting and exceeding the needs and expectations of those new and infrequent online shoppers," Freed said, "because you've paid more to attract this audience, you have so many more of them and the stakes are so much higher."


Another factor is that consumers have higher expectations during the holidays, especially for price discounts. Price was rated the lowest of any satisfaction driver across all retail categories measured, despite deep discounts offered by retailers.


Additional findings:


· Browsers who reach a retail Web site through a shopping search engine are less likely to return, buy something or recommend the site to a friend than if they come because of a company promotion or a referral.


· Customer segments with the highest satisfaction scores are also the most likely to buy from the retailer again, online or offline.


· More than one-third of respondents said that high gas prices influenced their decision to shop online instead of in the store.


While overall online sales aren't expected to drop as a result of lower satisfaction levels with the top 40 retailers, ForeSee does expect "people's loyalty to those specific retailers to suffer," Freed said.


Chantal Todé covers catalog and retail news and BTB marketing for DM News and DM News.com. To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting www.dmnews.com/newsletters


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