CX & Loyalty: Customer Experience Correlates To Buying (Charts For 20 Industries)

People are always asking us about the correlation between customer experience and business results. While we recommend that companies examine this relationship for their specific company, we’ve done extensive industrywide analyses on the topic. At the bottom of this post we’ve assembled a number of industry-specific charts that you can download and use.

In the report, ROI of Customer Experience, 2016, we provide a lot of data on how customer experience affects a number of different aspects of loyalty for 20 industries. Here’s a summary of some of the data showing the average connection between customer experience and loyalty across all industries.

1612_cxandloyaltyaverage20industries

Here’s how we calculate this data:

  • We ask 10,000 U.S. consumers to identify the companies that they’ve interacted with during the previous 90 days
  • We have those consumers rate their experiences and segment the respondents into five buckets based on their Temkin Experience Ratings feedback
  • For each of the five buckets of consumers, we calculate the average loyalty of the group across different dimensions using the calculations below…

1612_cxandloyaltymetrics

(Note: See Temkin Loyalty Index for data on specific companies)

CX and Purchase Intention Charts for 20 Industries

If you’re looking for good data for your industry, we’ve put together these 20 industry charts that show the relationship between customer experience and future purchase intention. Feel free to use them within your presentations in accordance with our citation policy.

For example, here’s some draft copy you might use, together with your industry’s chart, in your company’s internal or external blog:

At [Your Company’s Name], we work hard to improve our Customer Experience, and this industry chart from Temkin Group shows why it’s important and meaningful. As our Customer Experience improves, research shows that consumers are more likely to increase their spending with us, which is one of the many ways in which our customers show their increased loyalty. 

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Report: Temkin Loyalty Index, 2016

1611_temkinloyaltyindex_coverWe published a Temkin Group report, Temkin Loyalty Index, 2016. This is the second year of this study that examines the loyalty of U.S. consumers to 294 companies across 20 industries. Here’s the executive summary:

The 2016 Temkin Loyalty Index (TLi) evaluates how loyal 10,000 U.S. consumers feel towards 294 companies across 20 industries. To determine companies’ TLi, we asked respondents to rate how likely they are to exhibit five loyalty-related behaviors: repurchasing from the company, recommending the company to others, forgiving the company if it makes a mistake, trusting the company, and trying the company’s new offerings. Our research shows that, of all the companies we looked at, customers feel the most loyal towards Publix, USAA, and H-E-B, and feel the least loyal towards Comcast, Motel 6, and Anthem. At the industry level, we found that supermarkets, hotels, and retailers inspire the highest levels of loyalty, while TV service providers and Internet service providers trigger the lowest levels. Meanwhile, USAA, Mercedes-Benz, and Alabama Power Company enjoy the highest levels of customer loyalty compared with their industry peers, whereas Motel 6, Citibank, and Compaq fall the furthest behind their industry peers. We also compared the results of this year’s Index with those from last year and found that the average TLi declined across all 20 industries. TV service providers declined the most, while banks declined the least. And when we narrowed in on each of the five loyalty behaviors, we found that the Trust component scores dropped most significantly. And while the vast majority of individual companies’ TLi decreased over the past year, both Con Edison of NY and Morgan Stanley Smith Barney saw their scores improve by more than nine points.

Here’s the 2015 Temkin Loyalty Index.

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Temkin Group’s TLi is based on evaluating consumers’ likelihood to do these five things (data for these items are included in the dataset):

  • Repurchase from the company
  • Recommend the company to others
  • Forgive the company if it makes a mistake
  • Trust the company
  • Try new offerings from the company

Here are the top and bottom rated companies:

1611_tli_topbottomcompanies

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Report: ROI of Customer Experience, 2016

1610_roiofcx_coverWe published a Temkin Group report, ROI of Customer Experience, 2016. This research shows that CX is highly correlated to loyalty across 20 industries. Here’s the executive summary:

To understand the connection between customer experience (CX) and loyalty, we examined feedback from 10,000 U.S. consumers that describes both their experiences with and their loyalty to different companies. To examine the CX component, we used the 2016 Temkin Experience Ratings (TxR), which evaluated 294 companies. Our analysis shows that there’s a very large correlation between companies’ TxR and the willingness of customers to purchase more from them. This connection holds true for other areas of customer loyalty as well. We used this data to calculate the revenue impact of CX across 20 industries. We found that a moderate increase in CX generates an average revenue increase of $823 million over three years for a company with $1 billion in annual revenues. Rental car agencies have the most to gain from improving CX ($967 million), while utilities have the least to gain ($645 million). While all three components of customer experience¬—success, effort, and emotion—have a strong effect on loyalty, our research shows that emotion is the most important element. When compared with companies with very poor CX, companies with very good CX have a 16.7 percentage-point advantage in customers who are willing to purchase more from them, 16.7 percentage-point advantage in customers who trust them, 10.3 percentage-point advantage in customers willing to forgive them if they make a mistake, and 7.1 percentage-point advantage in customers who are willing to try their new products. Additionally, companies with very good CX ratings have an average Net Promoter Score that is 22 points higher than the scores of companies with poor CX. We recommend that you build your own CX ROI models, using our five-step approach for guidance.

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This is one of the figures in the report, and it shows the high correlation between Temkin Experience Ratings (customer experience) and purchase intentions for 294 companies across 20 industries:
1610_purchasemorecorrelationgraphHere’s an excerpt from the graphic showing the three year impact on revenues for a $1 billion company in 20 different industries:

1610_roirevsbyindustry

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To see the customer experience levels of all 294 companies, download to the free 2016 Temkin Experience Ratings report.

P.S. Net Promoter Score, Net Promoter, and NPS are registered trademarks of Bain & Company, Satmetrix Systems, and Fred Reichheld.

Report: Net Promoter Score Benchmark Study, 2016

1610_npsbenchmarkstudy_coverWe published a Temkin Group report, Net Promoter Score Benchmark Study, 2016. This is the fifth year of this study that includes Net Promoter® Scores (NPS®) on 315 companies across 20 industries based on a study of 10,000 U.S. consumers. Here’s the executive summary:

As many large companies use Net Promoter® Score (NPS) to evaluate their customer loyalty, Temkin Group measured the NPS of 315 companies across 20 industries. With an NPS of 68, USAA’s insurance business earned the highest score in the study for the fourth year in a row. Four other companies also earned an NPS of 60 or higher: Cadillac, USAA’s banking business, Apple, and USAA’s credit card business. In addition to earning some of the top scores, USAA’s banking, credit card, and insurance businesses also all outpaced their respective industries’ averages by more than any other company. Comcast, meanwhile, earned the lowest NPS for the second year in a row, coming in just below Time Warner Cable, Cox Communications, and McDonalds. And while all 20 industries increased their average NPS from last year, utilities enjoyed the biggest improvement in its score. Out of all the companies, US Airways’s and Advantage Rent-A-Car’s scores improved the most, whereas TriCare’s and Lexus’s scores declined the most. On average across the industries, the youngest consumers gave companies the lowest NPS, while 35- to 44-year-olds gave them the highest NPS.

See the NPS Benchmark Studies from 2012, 20132014, and 2015.

Here’s a list of companies included in this study (.pdf).

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Here are the NPS scores across 20 industries:
1610_rangeofindustrynps

Here are some other highlights of the research:

  • Five industries toped the list with an average NPS of 40 or more: auto dealers, software, investments, computers & tablets, and appliances.
  • The bottom scoring industries are TV service providers, Internet service providers, and health plans.
  • USAA’s insurance, banking, and credit card businesses earned NPS levels that are 30 or more points above their industry averages. Five other firms are 20 or more points above their peers: com, credit unions, Chick-fil-A, Apple, and Trader Joe’s.
  • Five companies fell 25 or more points below their industry averages: RadioShack, Motel 6, eMachines, McDonalds, and Days Inn.
  • US Airway’s NPS increased by 31 points between 2015 and 2016, the largest increase of any company. Eight other companies improved by 25 or more points: Fifth Third, 21st Century, Fujitsu, DHL, MetLife, HSBC, Commonwealth Edison, PSE&G, and Hannaford.
  • TriCare, Lexus, Mercedes-Benz, Baskin Robins, and Nordstrom had double-digit declines in NPS between 2015 and 2016.

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If you want to know what data is included in this report and dataset, download this sample Excel dataset file.Screen Shot 2014-10-17 at 4.05.17 PM

P.S. Net Promoter Score, Net Promoter, and NPS are registered trademarks of Bain & Company, Satmetrix Systems, and Fred Reichheld.

Data Snapshot: Channel Preferences Benchmark, 2016

1609_ds_channelpreferences2016_coverWe just published a Temkin Group data snapshot, Channel Preferences and Cross-Channel Activity Benchmark, 2016. The research examines consumer preferences for using different channels for completing common tasks as well as the frequency of several cross-channel interactions.

Here’s the executive summary:

In Q3 2016, we surveyed 10,000 U.S. consumers about their channel preferences for performing 11 different activities—such as selecting a life insurance policy or applying for a new credit card—and compared them to the results of a similar study conducted in 2015. This data snapshot examines how channel preferences vary across age groups, how these preferences have changed over the past year, and how channel preferences differ across multiple activities. (See last year’s data snapshot).

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A key component of the research examines how consumers would like to complete 11 different interactions with companies: Apply for a new credit card, change the beneficiary on a life insurance account, check the balance on a savings or checking account, check the delivery status of a purchase you made, investigate a mistake in your monthly cell phone bill, open a new investment account, purchase a new auto insurance policy, resolve a technical problem with your computer, select a life insurance policy,  and update your address on an account after you move.

The report has 13 data-filled charts, covering the 11 activities with details of preferences by age. Here’s one of the graphics (without the numbers) showing that consumers most prefer using their computers…

1609_channelpreferences

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2016 Temkin Emotion Ratings (Publix, Chick-fil-A, and Residence Inn Are the Leaders)

For the previous five years, we’ve measured emotion as part of the Temkin Experience Ratings (TxR). This year, we examined 294 companies across 20 industries based on a survey of 10,000 U.S. consumers (see methodology section below). The TxR examines the three elements of customer experience: success, effort, and emotion. In this post, I examine the results for the Temkin Emotion Ratings.

Emotion is the component of customer experience that is the most significant driver of customer loyalty. And we showed the connection between emotion and loyalty in a recent post. To find out more about how you can tap into the power of customer emotions, visit the Intensify Emotion Movement.

Publix, Chick-fil-A, and Residence Inn earned the only “good” scores for delivering the most positive emotional experiences, followed closely by H-E-B, True Value, Kroger, Save-a-Lot, Wawa Food Market, QVC, and Amazon.

At the other end of the emotional spectrum, the companies with the lowest Ratings are Comcast (for both Internet service and TV service), Fujitsu, Health Net, Blue Shield of CA, Anthem, Time Warner Cable, Commonwealth Edison, Medicaid, Charter Communications, and AT&T.

1609_temotr_leaderslaggards

Do you want to the data from the 2016 Temkin Effort Ratings? It’s included in the Temkin Experience Ratings spreadsheet that you can purchase for $395.
Here’s a sample of the spreadsheet (.xls)

Here are some additional insights from the 2016 Temkin Emotion Ratings:

  • The supermarket and fast food industries earned the highest average Temkin Emotion Ratings (at “okay” level), while health plans, TV service providers, and Internet providers were at the bottom with “very poor” ratings.
  • The following companies earned ratings that are the most above their industry averages: Amazon, Residence Inn, Florida Power & Light, TXU Energy, National Car Rental, and Alabama Power Company.
  • The following companies earned ratings that are the farthest below their industry averages: Fujitsu, Motel 6, Super 8, Chrysler, Volkswagen, Commonwealth Edison, and Citibank.
  • The following companies earned the largest improvement between the 2015 and 2016 Ratings: Coventry Health Care, True Value, Con Edison of NY, Consumers Energy Company, Dominion Virginia Power, and Fox Rent A Car.
  • The following companies declined the most between 2015 and 2016: Volkswagen, Fujitsu, Commonwealth Edison, BMW, GM, Health Net, and JetBlue.

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2016 Temkin Effort Ratings (Publix, O’Reilly Auto Parts, True Value, and Save-a-Lot Are The Leaders)

For the previous six years, we’ve measured effort as part of the Temkin Experience Ratings. This year, we examined 294 companies across 20 industries based on a survey of 10,000 U.S. consumers (see methodology section below). In this post, I’m showcasing the results from the effort component of those ratings.

Congratulations to Publix, O’Reilly Auto Parts, True Value, Save-a-Lot, Kohl’s, credit unions, H-E-B, Aldi, and Regions Bank for earning the top scores in the 2016 Temkin Effort Ratings. At the other end of the spectrum, Health Net, Fujitsu, Medicaid, Highmark BCBS, Empire BCBS, Dollar Rent A Car, CareFirstSprit Airlines, and Comcast earned the lowest ratings.1608_TER_LeadersLaggards

Do you want to the data from the 2016 Temkin Effort Ratings? It’s included in the Temkin Experience Ratings spreadsheet that you can purchase for $395.
Here’s a sample of the spreadsheet (.xls)

Here are some additional insights from the 2016 Temkin Effort Ratings: Read more of this post

USAA, Regions, and Amazon Top 2016 Temkin Web Experience Ratings

For the third straight year, USAA took the top spot in the Temkin Web Experience Ratings. Based on a study of 10,000 U.S. consumers, the 2016 Temkin Web Experience Ratings examine 257 companies across 20 industries (see full list of companies (.pdf))You can see all of the company data on the Temkin Ratings website.

Download dataset for $295 (download sample file (.xls))

***See how your company can reference these results
or display a badge for top 10% and industry leaders***

USAA earned the top spot for its banking business, followed by Regions Bank and Amazon.com tied for the second spot. USAA was also in the top 10 with its insurance and credit card businesses, along with Amazon Kindle business, Capital One 360, QVC, TD Bank, and credit unions.

Health Net earned the lowest Temkin Web Experience Ratings followed by Comcast (TV service and Internet service), Days Inn, Fujitsu, Compaq, Motel 6, Medicaid, Cox Communications, and Charter Communications.

1607_TWxR_HighLow

Here are some more highlights from the 2016 Temkin Web Experience Ratings: Read more of this post

Report: Economics of Net Promoter Score, 2016

1606_EconomicsofNetPromoter_COVERWe just published a Temkin Group report, Economics of Net Promoter, 2016. Here’s the executive summary:

Net Promoter® Score (NPS®) is a popular metric that companies use to analyze their customer experience efforts, but how does it actually relate to loyalty? We asked thousands of consumers to give an NPS to 294 companies across 20 industries, and then we examined the connection between NPS and four key areas of loyalty. We found that compared to detractors, promoters are more than five times as likely to repurchase from companies, more than seven times as likely to forgive companies if they make a mistake, and almost nine times as likely to try new offerings from companies. Our research also shows that promoters recommend a company to an average of 3.5 people. The following analysis provides detailed loyalty data of promoters, passives, and detractors across 20 industries: airlines, auto dealers, banks, computer and tablet makers, credit card issuers, fast food chains, health plans, hotel chains, insurance carriers, Internet service providers, investment firms, major appliance makers, parcel delivery services, rental car agencies, retailers, software firms, supermarkets, TV service providers, utilities, and wireless carriers. Ultimately, if a company wants to benefit from using NPS as a key metric, it must focus on improving customer experience, not obsessing over the metric itself.

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Here’s one of the 12 graphics in the report, which shows the average loyalty differences for promoters, passives, and detractors across all industries:NPSEconomicsOverview

The report provides this loyalty data for promoters, passives, and detractors for 20 industries: airlines, auto dealers, banks, computer and tablet makers, credit card issuers, fast food chains, health plans, hotel chains, insurance carriers, Internet service providers, investment firms, major appliance makers, parcel delivery services, rental car agencies, retailers, software firms, supermarket chains, TV service providers, utilities, and wireless carriers.

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See our VoC/NPS resource page, which includes great resources for creating a successful NPS program. You mat also want to see our latest NPS Benchmark Report with NPS data on 291 companies.

The bottom line: Promoters are much more valuable than detractors.

Net Promoter Score, Net Promoter, and NPS are registered trademarks of Bain & Company, Satmetrix Systems, and Fred Reichheld.

USAA and Publix Top 2016 Temkin Customer Service Ratings

USAA earned the highest score in the 2016 Temkin Customer Service Ratings for the fourth year in a row. These Ratings evaluate the customer service of 277 companies across 20 industries based on a study of 10,000 U.S. consumers (see .pdf with full list of companies). You can see all of the company data on the Temkin Ratings website.

Download dataset for $295 (download sample file)

***See how your company can reference these results
or display a badge for top 10% and industry leaders***

USAA earned the top spot this year for its banking business with a 74% rating, and Publix came in a close second with a rating of 73% In addition to its banking business, USAA also placed in the top ten for both its insurance business and its credit card business. USAA and Publix were joined in the top 10 by True Value, credit unions, QVC, H-E-B, Wawa Food Markets, and Save-a-lot.

Comcast, meanwhile, earned the lowest score in the Temkin Customer Service Ratings for the third straight year. Once again, the company received the two lowest scores in the Ratings, one for its TV service business and one for its Internet service, business both of which received a score of 31%.. Comcast was joined in the bottom by GM, Charter Communications (for both Internet service and TV service), Health Net, Time Warner Cable (for both Internet service and TV service), AT&T, Motel 6, and Spirit Airlines.

1606_TCSR_HighestLowest1606_TCSR_IndustryRanges

Here are some additional highlights from the 2016 Temkin Customer Service Ratings: Read more of this post

2016 Temkin Experience Ratings: 20 Industry Snapshots

Temkin Experience Ratings

We released the 2016 Temkin Experience Ratings that ranks the customer experience of 294 companies across 20 industries based on a survey of 10,000 U.S. consumers. Here’s a link to FAQ’s about the Ratings.

As a follow-up, we published blog posts that examine the results for each of the 20 industries. You can see links to all of those industry snapshots below:

1606_TxRIndustries> Airlines
> Auto Dealers
> Banks
> Computers & Tablets
> Credit Card Issuers
> Fast Food Chains
> Health Plans
> Hotels
> Insurance Carriers
> Internet Service Providers
> Investment Firms
> Major Appliances
> Parcel Delivery Services
Rental Car Agencies
> Retailers
> Software Firms
> Supermarkets
> TV Service Providers
> Utilities
> Wireless Carriers

Temkin Ratings websiteYou can see the ratings of all companies on the Temkin Ratings website

USAA and Publix Top 2016 Temkin Forgiveness Ratings

We just published the 2016 Temkin Forgiveness Ratings, the sixth year of the ratings. It uses feedback from 10,000 U.S. consumers to rate the level of trust that consumers have with 294 organizations across 20 industries (see .pdf with full list). You can see all of the company data on the Temkin Ratings website.

Download dataset for $295 (see sample file)

USAA ‘s banking business and Publix took the top spots in the 2016 Temkin Forgiveness Ratings. USAA (credit cards), Amazon.com (for retail and computer & tablets), Food Lion, H-E-B, Wawa Food Markets, and Kroger fill out the top spots.

Comcast (for both TV service and Internet service) earned the lowest Temkin Forgiveness Ratings. Other firms on the bottom of the ratings are Charter Communications (TV service and Internet service), Motel 6, Health Net, Time Warner Cable (TV service and Internet service), Cox Communications and Anthem.

1604_ForgivenessRatings_TopBottom

Additional highlights of the 2016 Temkin Forgiveness Ratings: Read more of this post

USAA, Credit Unions and Publix Top 2016 Temkin Trust Ratings

We just published the 2016 Temkin Trust Ratings, the sixth year of the ratings. It uses feedback from 10,000 U.S. consumers to rate the level of trust that consumers have with 294 organizations across 20 industries (see .pdf with full list). You can see all of the company data on the Temkin Ratings website.

Download dataset for $295 (see sample file)

For the second straight year, USAA (for banking and insurance) took the top two spots. The next highest scoring companies are credit unions, Publix, Mercedes-Benz, USAA (credit cards), Chick-fil-A, Amazon.com, Residence Inn, H-E-B, Lexus, and BJ’s Wholesale Club.

Also for the second year in a row, Comcast earned the lowest two spots in the Temkin Trust Ratings for its TV service and Internet service businesses. But many of its competitors also earn very poor ratings. The next lowest rated companies are Charter Communications (for Internet service and TV service), Time Warner (for Internet service and TV service), and Cox Communications.

1604_TTR_TopBottomOrgs

Additional highlights of the 2016 Temkin Trust Ratings: Read more of this post

Report: What Happens After a Good or Bad Experience, 2016

1603_WhatHappensAfterGoodBadExperiences_COVERWe just published a Temkin Group report, What Happens After a Good or Bad Experience, 2016. This is our annual analysis of which companies deliver the most and least bad experiences, how consumers respond after those experience (in terms of sharing those experiences and changing their purchase behaviors), and the effect of service recovery (see last year’s report).

Here’s the executive summary:

We asked 10,000 U.S. consumers about their recent interactions with 315 companies across 20 industries, and compared results with similar studies over the previous five years. More than 20% of the customers of Internet service providers and TV service providers reported a bad experience, considerably above the rates for any other industry. Air Tran Airways, Time Warner Cable (TV service and Internet service), Comcast (TV service), and HSBC delivered bad experience to at least one-quarter of their customers. At the same time, less than 3% of Michael’s, Advance Auto Parts, Whole Foods, Publix, Subway, Vanguard, Trader Joe’s, and GameStop customers report having bad experiences. We examined the combination of the volume of bad experiences and the resulting revenue impact and created a Revenues at Risk Index for all 20 industries. At the top of the list, TV service providers and rental car agencies stand to lose at least 6.5% of their revenue from bad experiences. Conversely, less than 2% of the revenues for retailers and supermarket chains are at risk. The companies that recovered very poorly after a bad experience lost sales from 63% of their customers, more than 2.5 times as many as companies that recovered very well. Companies that do a very good job at recovering after a bad experience have more customers who increase spending than those who decrease spending. After a very bad or very good experience, consumers are more likely to give feedback directly to the company than they are to post on Facebook, Twitter, or third party rating sites. Regardless of the channel, consumers are more likely to discuss a very bad experience than a very good one. While the way that consumers give feedback has not changed much since last year, the volume of Twitter usage grew for both positive and negative experiences. Piggly Wiggly, US Cellular, Fifth Third, The Hartford, TriCare, and PSE&G face the potential for the most negatively biased feedback from customers.

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Here are excerpted versions of 4 (out of 15) graphics in the report: Read more of this post

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