Satisfaction with purchases climbs
If you’re waiting for food at Pizza Hut and using your Samsung cellphone on the Sprint Nextel network to reserve a flight on United Airlines, you may be in for some disappointments.
Those companies suffered some of the biggest drops in consumer satisfaction over the last year, according to the University of Michigan’s closely watched American customer satisfaction index, which was released late Monday.
The survey focuses on a different group of industries each three months, then follows up on the findings during the same quarter the next year.
Despite the drops by some big-name companies, customers in general were slightly happier with goods and services they bought in the first quarter. The overall index rose to 75.2 out of 100, up from 74.1 the same period last year. It was the highest overall score since the university started the survey in 1994.
“Growth is slowing down a bit, but there’s still a positive growth,” said Claes Fornell, director of the university’s National Quality Research Center, which compiles and analyzes the data.
The index results follow some dreary U.S. economic news released last week: Retail sales fell 2.4% in April and employers that month added the fewest jobs in more than two years.
Fornell, however, said he didn’t foresee a bottoming out of the economy, just somewhat slower growth.
The biggest effect on the economy effect, he said, comes from the level of debt and the “gratification from spending.”
“It doesn’t seem to matter what is thrown at the consumer -- higher gas prices, inflation, higher debt, fewer jobs -- the American consumer can always find a way to spend,” the economist said. “But at some point there will be some restrictions.”
The university’s index does show some signs of weakness. For example, Fornell said, more companies saw their scores fall than rise. Large gains by some companies lifted the overall score. “Quite a few companies are falling behind,” he said.
None more so than those in the cable and satellite television industry, which perennially registers at the bottom of the survey and had the lowest overall score this quarter -- 62, down from 63 a year earlier.
None of the major firms in the industry improved in consumers’ eyes, and scores fell as much as 6.7%. Satellite TV firms ranked higher than cable firms by four or more points.
“It’s disappointing that cable companies are not just doing poorly but doing worse,” Fornell said. “The only way to correct that is to make sure the industry is competitive. Choice is clearly restricted.”
The survey’s industry focus changes with the quarter. The first quarter, in which 26,000 U.S. residents responded, covers utilities, airlines, express delivery, hotels, restaurants and communications.
Among the highlights:
* Land-line phone companies overall showed no change, remaining at 70. But Cox Communications Inc. dropped 7.9% from its lofty perch to the industry average. The new leaders, each with a score of 72, are Qwest Communications International Inc. and Verizon Communications Inc., up from 70 and 69, respectively.
* The wireless industry hit an all-time high, up 3% to an overall score of 68, but that still makes it one of the five lowest-scoring industries. Sprint Nextel Corp., which fell 3.2%, was the only one to fall. Verizon Wireless led the way with 71, up from 69.
* Samsung, whose score fell 4.1% from a year earlier, was the only cellphone maker to see a decline. Manufacturers as a whole held steady with a score of 70.
* Airlines in general dropped to 63 from 65, pulled down by United’s 11.1% drop to 56 and Delta Air Lines’ 7.8% fall to 59. Southwest Airlines was No. 1 among companies in the industry with a score of 76, up from 74.
* Among fast-food and limited-service restaurants, Starbucks Corp. and Wendy’s International Inc. led the field with scores of 78 each, up from 77 and 76, respectively. Pizza Hut Inc. had the biggest fall, dropping 5.3% to 72.
* In the energy category, Edison International fell 5.1% to 74, while Sempra Energy rose 6.7% to 80 and Pacific Gas & Electric Co. rose 5.9% to 72.
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The best and worst
Customers were slightly more satisfied with what they bought in the first three months of this year, raising a popular index to a record 75.2 out of 100.
Top 5 in Southern California
*--* Company Score % change FedEx 84 -2.3% UPS 81 -2.4 Olive Garden 80 NA Marriott Hotels 79 +5.3 Outback Steakhouse 79 NA
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Bottom 5 in Southern California
*--* Company Score % change Charter Communications 55 0% United Airlines 56 -11.1 Time Warner Cable 58 -4.9 Delta Air Lines 59 -7.8 American Airlines 60 -3.2
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Sources: University of Michigan’s American customer satisfaction index
for the first quarter, 2007.
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Los Angeles Times
