Even though we’re in a recession, even though numerous analysts predict that some retail chains will have to close their doors forever as a result of this holiday shopping season, still nearly 40% saw their satisfaction scores decline year over year. Only a quarter improved. The research shows that a highly satisfied online shopper is  73% more likely to make a purchase online, 38% more likely to purchase offline, and 75% more likely to recommend than a dissatisfied website shopper. The reward for satisfying your customers is huge…and the penalty for not can be a disaster.

So here are some highlights:

The Leaders: Only two of the measured websites scored over 80, usually considered the “top performer” threshold for U.S. e-retailers.

• Amazon (up two points) ties Netflix (down two points) for the top spot this year, both with a score of 84. These two industry giants widened their lead over all other retailers significantly in terms of online shopper satisfaction. Last year, Amazon came in second (behind Netflix) and was in a tight pack of six retailers all within a four-point range. It’s remarkable and admirable that such a clear industry leader is not resting on its laurels and is constantly striving to improve the customer experience. Because satisfaction is predictive of financial success, it’s no surprise that Amazon is reporting better financial results than the rest.
• Rounding out the list of top-tier online retailers are QVC (down one point to 79) and a tight pack of e-retailers all at 78: Apple (down one point), Barnes &Noble, L.L. Bean (down two points), Newegg (up one point), and Wal-Mart (up four points).

The Most Improved: Ten sites improved year-over-year.  The most notable increases were:

• HP Home and Home Office Store (up five points to 76)–HP sees a strong increase, despite a struggling economy and extremely competitive PC environment. HP is firing on all cylinders and seems well positioned to continue their rise. They could even one day be the leader in the PC world, making the conflict between Apple and Microsoft irrelevant.
• Wal-Mart (up four points to 78). Wal-Mart is climbing fast—four points in one year and five points since 2006. Their value model clearly plays well in this economic environment, so a key challenge for them will be whether they can retain customer loyalty when the economy improves.
• Staples (up four points to 77)
• Target (up three points to 75)

The Largest Declines: About two out of five of the measured sites saw their scores decline: 15 of 37 saw lower satisfaction scores in 2008 than they did in 2007. The largest declines were for:

• HSN—Home Shopping Network (down seven points and more than 9% to 69)
• Gap (down 5 points to 69)–Gap slips, despite making major changes to checkout so that customers can shop across four brands in one session with one shopping cart. On the surface, it seems like an idea that might be good for business. However, this feature may not have been important to Gap’s online customers to begin with because they may view the other brands differently in terms of price, quality, and style. Our findings indicate that the functionality of their website is critical to their shoppers’ satisfaction, so they may need to revisit exactly which changes would benefit their customers’ web experience most.

The Laggards: Retailers scoring 69 or lower are less successful at satisfying shoppers, which can erode loyalty while missing out on a tremendous opportunity to leverage the web channel to improve the bottom line. Six e-retailers scored 69 this year: Gap, HSN, Circuit City, Home Depot, Neiman Marcus, and Overstock.

Download the full report here.

The 2008 edition of the Top 40 Online Retail Satisfaction Index is the fourth annual evaluation of holiday shopper satisfaction with top 40 retail websites by sales volume, as reported by Internet Retailer. ForeSee Results also measures satisfaction with the Top 100 online retailers every spring, resulting in eight consecutive reports on customer satisfaction with the top e-retailers over the last four years.

The Top 40 Online Retail Satisfaction Index uses the methodology of the American Customer Satisfaction Index to analyze data collected from visitors to the Top 40 retail websites, as defined by sales volume from the Internet Retailer Top 500 Guide. Data was collected through FGI Research’s SmartPanel™, a nationwide panel of approximately 1.6 million consumer households who have agreed to participate in opt-in surveys.

 

More than 9,000 survey responses were collected from December 1, 2008 through December 18, 2008 from shoppers who had visited the Top 40 retail web sites at any point within the prior 14 days.

 

Some respondents went on to complete an online purchase; others didn’t, so the respondent group is defined as “website browsers.” Browsers include existing customers, first-time visitors, infrequent visitors, competitors’ customers who may be cross-shopping, and others spending time researching purchases on a retail web site, perhaps with the intent to purchase through offline channels. They may shop on a variety of websites and other channels before making a purchase. Knowing why a browser does or doesn’t purchase during the visit is one of the keys to understanding multichannel impact as well as the degree to which even these top e-retailers are fulfilling their potential.

 

The Top 40 Online Retail Satisfaction Index is based upon the methodology of the University of Michigan’s American Customer Satisfaction Index (ACSI), the only cross-industry methodology scientifically proving that organizations that more effectively satisfy customers realize higher financial returns. For the past seven years, ForeSee Results has used this scientific approach to measure online customer satisfaction with nearly 100 leading e-retail sites in both the U.S. and the U.K. Additionally, the firm produces the U.K.-based Top 30 U.K. Online Retail Satisfaction Index every Christmas and a Top 100 Online Retail Satisfaction Index every spring, which provides an interesting point of comparison to customer satisfaction with U.K. online retail.