Customer Experience (Ratings) on Serious Decline

Customer experience scores are dropping, but there's more to the story.
Customer Experience

We recently released the 2016 Temkin Experience Ratings (TxR). This is the 6th year that we've published this free, open-standard customer experience benchmark. This year, we rated 294 organizations across 20 industries.

TxR taps into feedback from 10,000 U.S. consumers to measure the three components of an experience:

  • Success: The degree to which customers can accomplish their goals
  • Effort: The difficulty or ease that customers face in accomplishing their goals
  • Emotion: How the interaction makes customers feel

Company Results in the 2016 Temkin Experience Ratings

How did the results turn out in 2016? Let me start by giving kudos to the companies that did well:

  • Highest 2016 TxR: Supermarkets dominate the top of the ratings. The companies with the highest scores are Publix, H-E-B, Chick-fil-A, True Value, Save-a-Lot, Kroger, Wegmans, credit unions, Aldi, Amazon, and O'Reilly Auto Parts.
  • Most improved TxR: When we compared 2015 to 2016 results, Coventry Health Care, Con Edison, True Value, Consumers Energy, and Fox Rent A Car improved the most.

Of course, there are also some organizations that did not do quite as well:

  • Lowest 2016 TxR:. Health plans dominate the bottom of the ratings. The companies with the lowest customer experience scores are Fujitsu, Health Net, Dollar Rent A Car, Comcast, Care First (BCBS), Highmark (BCBS), Empire (BCBS), Spirit Airlines, Blue Shield of CA, and Medicaid.
  • Most drop in TxR: The companies with the largest decline in TxR between 2015 and 2016 are Volkswagen, Fairfield Inn, Fujitsu, Commonwealth Edison, Humana, BMW dealers, and Bed, Bath & Beyond.

The Decline of Customer Experience (Ratings)

Okay, so some companies get good CX ratings and others get poor ones. We expect to see that every year. But what we didn't expect to see was the severe decline in scores across industries.

When we compared the 2016 TxR with the results from 2015 we found that:

  • The percentage of good and excellent companies dropped from 37 percent in 2015 to 18 percent in 2016.
  • Of the 271 companies in both the 2015 and 2016 TxR, 85 percent declined by 1-point or more, while 6 percent increased by 1-point or more.
  • The average score for all 20 industries declined between 2015 and 2016.

Although we saw some decline in the ratings last year, this year's drop is unprecedented.

What's Going On? It's All About Consumers Expectations

One explanation for the decline is that companies are getting worse at CX. Given the amount of effort that companies are putting into improving CX, this does not seem to be a likely situation. Especially since we have other data showing that large companies are actually building stronger customer experience competencies.

A second explanation is that consumer expectations are rising at a pace that is faster than the speed at which companies are improving their CX. This makes sense. Consumers are becoming more aware of customer experiences and are expecting every interaction to be as good as the best experience they have with any company in any industry. A few companies that are really, really good at CX are establishing the baseline of expectations that consumers are using to judge all companies.

I also think something else is happening with the ratings, they're being depressed by a general decline in the attitudes of U.S. consumers. We will soon be publishing the annual Temkin Well-Being Index (TWBi), which examines the degree to which U.S. consumers feel happy, healthy, and financially secure. It turns out that the TWBi took a major drop this year. Consumers are just not as content as they have been in previous years.

What Should you Do?

Forget the noise about the overall decline, there's nothing you can do about consumer attitudes. But with consumers comparing your company to the best companies across all industries, you probably need to set your CX sights a bit higher. Keeping up with mediocre peers is no longer a viable strategy.

As the gap between customer expectations and existing CX grows, there will be more opportunities for you (or your competitors) to radically improve the level of CX and grab new customers.