The American Customer Satisfaction Index (ACSI) 2014 Retail Report came out last week and it’s good news for Costco. Costco is once again at the top of the customer satisfaction ratings for specialty retailers. Since customer satisfaction is so important to retailers, this is an important benchmark to track. And of course, customer satisfaction is also one of the things that Costco puts a lot of emphasis on, so it is a good gauge for them (and all of us) to see how successful they are in their quest to have the best customer service.
Costco falls into the “Specialty Retail” section of the ACSI report. This is a sector of retail that they have been tracking since 2001 and covers not only warehouse stores, but home improvement, office supplies, as well as clothing stores. To determine customer satisfaction, ACSI gathers customer opinions based on a variety of important criteria: Store layout and cleanliness, Checkout speed, Staff courtesy, Store locations and hours, Sale and promotion frequency, Merchandise variety and selection, Ability to provide brand names, Merchandise availability, Website. They then use this information to calculate the customer satisfaction rating. Overall, they track seventeen major specialty retailers, as well as an aggregate of smaller stores in the category.
Costco came out on top of the specialty retailer category this year, again, with a score of 84. They’ve been pretty steady over the last few years, usually leading the group. The closest score this year was an 83 for L Brands, which covers Victoria’s Secret and Bath and Body Works. Their direct competitors were a bit further behind though. BJ’s Wholesale Club received a ranking of 81, while Sam’s Club scored just 80. The average customer satisfaction rating for specialty retailers was just 79 for 2014, so all of the warehouse clubs are exceeding that average at least. The loser in the group was Gap and to be honest, they never do all that well. I think they’ve been bringing up the rear for pretty much the entire time ACSI has been tracking them. Home Depot took a bit of a hit with a 3 point drop in their rating and I’m sure it is because of the credit card debacle.
The bad news for all bricks and mortar retailers is that the whole report points to a drop in satisfaction with traditional retailers, and much higher ratings for online retailers. In general, internet retailers have a customer satisfaction benchmark of 82 for 2014, whereas traditional retailers are at just 79, which is down from last year. For instance, Amazon has an impressive score of 86 this year, and even though that is down 2 points from last year it is still excellent. I think the only traditional retailer that can match that is Nordstrom, in the department and discount stores category. And while that is great for Nordstrom, the rest of the category lags well behind at a benchmark of 81 for 2014.
Just because everyone looks at Walmart as the big player in discount stores, I feel it necessary to point out that their customer satisfaction rating is a pathetically low 68 this year, which is down 3 points from last year; well below the average of 77 for their category. So, they might be a big player but it doesn’t seem like anyone actually likes shopping there.
You can download a full PDF copy of the ACSI Retail Report for 2014 online. If you just want the bare scores though, you can see exactly how Costco fared against all of the other specialty retailers too.