Advantage and USAA Are Most Forgivable Companies

Customer Experience
Customer Experience
Customer loyalty is not dead. But the assumption that any company can earn the unwavering commitment of their customers is simply naive.

What is Loyalty? And is it Dead? Let me start by answering the second part of the question: Loyalty is not dead. But the assumption that any company can earn the unwavering commitment of their customers is simply naive.

If you think that loyalty is the blind devotion of customers to purchase your goods and services, then it's not only dead, but it's crazy. Many marriage vows include the phrase "until death does us part," but there are still a lot of divorces. If people can't stay loyal to their spouses for life, why would we think that they can remain loyal to a company?

So what is loyalty? That's the key question. I'd like to throw out this simple definition:

The willingness to consider, trust, and forgive

A loyal customer is willing to consider new products and services you have to offer. A loyal customer is willing to consider you in their short list of suppliers for new purchases. A loyal customer is willing to trust your descriptions of new products. A loyal customer is willing to forgive you if you make a mistake (as long as it's not repeated or egregious).

What more can you really ask for?

We recently published the 2013 Temkin Forgiveness Ratings, which rates one of the least discussed elements of loyalty. As the famous line from an Alexander Pope poem: "To err is human; to forgive, divine." All companies, even customer experience leaders, make mistakes. But how much goodwill have they built up for customers to forgive them after those miscues?

It turns out that Advantage Rent A Car has earned the most forgiving customer base. USAA takes the next three spots for its banking, insurance, and credit card businesses. HSBC, on the other hand, has earned the least goodwill; it credit card and banking businesses earned the bottom two spots in the ratings.

Here are some additional insights from the ratings:

  • TV service providers are unforgivable. TV service providers, as an industry, earned the lowest Temkin Forgiveness Rating of 12 percent. It was five points below Internet service providers and seven points below wireless carriers.
  • Grocery chains are the most forgivable. With an average rating of 39 percent, grocery chains are the highest scoring industry. Three industries are just four points behind: hotel chains, auto dealers, and rental car agencies.
  • Credit cards make the most improvements. Credit cards made the largest improvement, nine percentage points, over the previous year. Auto dealers, rental car agencies, and airlines also improved by more than five points.
  • TV service providers head in the wrong direction. Led by TV service providers that dropped three points between 2012 and 2013, three industries earned lower scores in 2012. The other industries are retailers and appliance makers.