Online Service Lags at Big Firms

New York, NY, July 1--The number of online transactions is growing exponentially, but many big companies still aren't tuned in to how much the Internet can make or break customer perceptions of the business. In its third annual study of how companies treat online customers, the Customer Respect Group found that online customer service still falls short of what consumers get when they shop in a store or on the phone. In fact, unresponsive companies run the risk of losing millions of dollars in sales by providing poor Internet customer service, propelling customers into the hands of competitors just a click away, according to the study. "As Fortune 100 companies, they're continuing to not be particularly responsive [to online inquiries], and that's just unconscionable," said Roger Fairchild, president of Consumer Respect, a Bellevue, Wash., consulting firm that uses its trademark Customer Respect Index to help companies improve how they treat online customers. In its study, Consumer Respect looked at Web site simplicity, privacy protections, responsiveness to online inquiries and transparency in company policies, among other things. The survey found that while more than 90% of companies provide a privacy policy on their site, 75% don't tell users how to have their personal information destroyed so it can't be used by others. With many consumers still reluctant to complete transactions online because of privacy concerns, the survey concludes that companies would be best served by giving them clear choices about how their personal data will be used. Companies need to work on being more aware of their online presence, Mr. Fairchild said, because so many people look to the Internet for research on products they want to buy. A lot of comparison shopping is going on. Mr. Fairchild said that last year, 10.6% of all transactions -- at regular stores, online or wherever -- were initiated by a visit to a Web site, and that trend will only increase. The Internet "is having a big impact on business," he said. Overall, the survey found that the Internet performance of the Fortune 100 is slowly improving, but there remains a big gap at many firms. One new feature that many consumers find annoying: automatic responses that seem to get them nowhere. Many companies, 45% of those surveyed, provided no information on how quickly they would follow up. A fraction even require customers to pick up the phone to report a problem. One of the biggest parts of the study focused on how companies responded to e-mail inquiries. For the responsiveness portion, the consulting group sent two e-mails to the companies. They were then rated on several criteria, including response time and answer quality. Of the 100 companies, 67% responded to both inquiries, while 21% of the companies responded to one inquiry. In the study, 12% of the companies, including Morgan Stanley, PepsiCo and Prudential Financial, didn't respond to either inquiry. Morgan Stanley and Pepsi declined to comment, and Prudential couldn't be reached. According to a University of California, Los Angeles, study that tracks Internet use, consumers are spending considerably more time online. The average Internet user spends 12.5 hours a week online, according to UCLA's latest figures, compared with 9.8 hours in 2001. Internet analysts say that a gap remains between online and traditional customer service at some companies. Sheryl Kingstone, an industry analyst for customer-relationship management with the Yankee Group, says it's understandable how perhaps a few online requests out of millions might get neglected. "They may get lost in the shuffle," she says. But "if they're not able to handle basic customer inquiries, there's a major problem out there." A representative from Pfizer Inc., which was among the 12% of companies the study found unresponsive, said the drug maker has been praised for online customer-service excellence several times in the past. "We routinely conduct usability tests with consumers....We've been praised on ease of use and ability to find information," Pfizer spokeswoman Darlene Taylor said. Bank of America Corp. scored highest with a responsiveness score of 8.6 on a scale of zero to 10. Hewlwtt-Packard and Berkshire Hathaway Inc. each scored 8.5.

Related Topics:Shaw Industries Group, Inc.

Print the Article