Category: United States

Most Owners Satisfied with New Vehicles; Some Truly Love Them Despite Their Flaws, JD Power Finds

2020-07-20

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When it comes to driving sales, as well as generating brand loyalty and advocacy, vehicles that create joy for their owners often overcomes any negatives caused by problems they experience. This phenomenon is most effectively seen in the JD Power 2020 Automotive Performance, Execution and Layout (APEAL) Study,^SM released today.

“Purchasing the ‘right’ vehicle is influenced by a variety of factors, depending on each buyer’s specific tastes, wants and needs,” said Dave Sargent, vice president of automotive quality at JD Power. “The APEAL Study measures an owner’s emotional attachment to their new vehicle and in what areas that vehicle may not be delivering on all of the positive experiences that were hoped for. Understanding this is just as valuable to automakers as knowing about quality issues and owner acceptance of new technologies. The goal for automakers is to delight customers on all these dimensions. Some are better than others at doing this.”

Now in its 25^th year, the study has been redesigned for 2020. It complements the JD Power Initial Quality Study (IQS)^SM and the JD Power Tech Experience Index (TXI) Study^SM by measuring owners’ emotional attachment and level of excitement with their new vehicle across 37 attributes, ranging from the sense of comfort and luxury they feel when climbing into the driver’s seat to the feeling they get when they step on the accelerator. These attributes are aggregated to compute an overall APEAL index score measured on a 1,000-point scale.

Following are key findings of the 2020 study:

• Some vehicles deliver both outstanding levels of APEAL and initial quality: Eight models receiving APEAL segment awards also received awards in the 2020 Initial Quality Study: Audi A3, BMW X6, Cadillac CT6, Genesis G70, Hyundai Veloster, Jaguar E-Pace, Nissan Armada and Nissan Maxima.
• Gap between luxury and mass market brands is narrowest ever: The average APEAL score for luxury brands is 861 points, compared with 838 for mass market brands. This 23-point gap is the narrowest in the study’s history.
• Dodge’s notable achievement: By being the top-ranked mass market brand, Dodge becomes the first domestic brand to rank highest in the mass market segment for both APEAL and IQS in the same year. Only Hyundai has previously achieved the feat in the mass market segment, while Genesis, Lexus and Porsche have done so in the luxury segment.
• Tesla profiled for first time: Tesla receives an APEAL index score of 896. The automaker is not officially ranked among other brands in the study as it doesn’t meet ranking criteria. “Unlike other manufacturers, Tesla doesn’t grant us permission to survey its owners in 15 states where it is required,” said Doug Betts, president of the automotive division at JD Power. “However, we were able to collect a large enough sample of surveys from owners in the other 35 states and, from that base, we calculated Tesla’s score.”

Highest-Ranking Brands

Porsche ranks highest in the luxury segment and overall with a score of 881. Lincoln (876) ranks second, followed by Cadillac (874), BMW (869) and Land Rover (866).

Dodge ranks highest in the mass market segment with a score of 872. Ram (871) ranks second, followed by GMC (857), Ford (853) and MINI (846).

Mazda climbs the most in the mass market rankings, placing nine spots higher than in 2019. Cadillac climbs six places in the premium rankings, the most in that segment.

Model-Level APEAL Awards

The parent company receiving the most model-level awards (given to models ranking highest in their respective segment) is Hyundai Motor Group (five awards), followed by BMW AG and Nissan Motor Co., Ltd., with four each.

The complete list of award recipients is:

• Hyundai Motor Group: Genesis G70; Hyundai Sonata; Hyundai Veloster; Kia Stinger; and Kia Telluride
• BMW AG: BMW 7 Series; BMW X4; BMW X6; and MINI Countryman
• Nissan Motor Co., Ltd.: Nissan Armada; Nissan Maxima; Nissan Sentra; and Nissan Versa
• General Motors Company: Cadillac CT6; Chevrolet Blazer; and GMC Sierra HD
• Fiat Chrysler Automobiles: Dodge Challenger and Ram 1500
• Ford Motor Company: Ford Escape and Lincoln Navigator
• Honda Motor Company: Honda Odyssey and Honda Ridgeline
• Jaguar Land Rover Limited: Jaguar E-Pace and Land Rover Range Rover Velar
• Mazda Motor Corporation: Mazda CX-5
• Toyota Motor Corporation: Toyota C-HR
• Volkswagen AG: Audi A3

The BMW X6 is the highest-scoring model in the study. Receiving a model-level award for a third consecutive year are MINI Countryman and Nissan Maxima. BMW X4, Chevrolet Blazer, Dodge Challenger, Honda Odyssey and Lincoln Navigator each receive a model-level award for a second consecutive year.

The 2020 U.S. APEAL Study is based on responses from 87,282 owners of new 2020 model-year vehicles who were surveyed after 90 days of ownership. It was fielded from February through May 2020.

The study, which complements the annual JD Power Initial Quality Study (IQS)^SM and the JD Power Tech Experience Index (TXI) Study,^SM is used extensively by manufacturers worldwide to help them design and develop more appealing vehicles, and is used by consumers to help them in their purchase decisions. The 2020 redesign marks the fourth generation of the study.

For more information about the 2020 U.S. APEAL Study, visit http://www.jdpower.com/resource/jd-power-automotive-performance-execution-and-layout-apeal-study.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, Asia Pacific and Europe.

Media Relations Contacts
Geno Effler, JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
Shane Smith; East Coast; 424-903-3665; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info

 

Kitchen and Laundry Appliance Manufacturers Must Leverage Online Presence and Support, JD Power Finds

2020-07-23

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Whether it be on Facebook, Instagram, YouTube or online retailer websites, kitchen and laundry appliance manufacturers must stay connected to their customer base online, according to the JD Power 2020 Kitchen and Laundry Appliance Satisfaction Studies,^SM released today.  

“Unsatisfied kitchen and laundry appliance customers have a tendency to be more vocal about their experiences, especially online, than those who are satisfied,” said Christina Cooley, At Home intelligence lead at JD Power. “It is imperative that manufacturers are creating an ecosystem for their customers where shoppers and purchasers can access educational video tutorials and customer testimonials to offset the negative reviews online shoppers are seeing. The more customers are educated on product features, the easier it will be for them to use the products effectively and efficiently, therefore increasing satisfaction.”

The Kitchen Appliance Satisfaction Study and the Laundry Appliance Satisfaction Study, now in their 15th and 16th years, respectively, measure customer satisfaction in 11 segments of major home appliances: clothes washers (front-load washers and top-load washers are measured separately); clothes dryers; dishwashers; cooking appliances (cooktops, freestanding ranges, over-the-range microwaves, and wall ovens are measured separately); and refrigerators (French door refrigerators, side-by-side refrigerators and top-mount freezer two-door refrigerators are measured separately).

Kitchen Appliance Satisfaction Study

Dishwashers
Samsung (878) ranks highest in customer satisfaction among dishwashers, followed by Bosch (872) and LG (869).

Over-the-Range Microwaves
Samsung (863) ranks highest in customer satisfaction among over-the-range microwaves. LG (861) ranks second and Kenmore (860) ranks third.

Freestanding Ranges
Samsung (879) ranks highest in customer satisfaction among freestanding ranges, followed by Frigidaire (866).

Cooktops
LG (877) ranks highest in customer satisfaction among cooktops, followed by GE Appliances (864) and Frigidaire (860).

Wall Ovens
LG (892) ranks highest in customer satisfaction among wall ovens, followed by Samsung (887) and Bosch (876).

French Door Refrigerators
Samsung (884) ranks highest in customer satisfaction among French door refrigerators and is followed by LG (875).

Side-by-Side Refrigerators
LG (867) ranks highest in customer satisfaction among side-by-side refrigerators and is followed by Samsung (866) and Whirlpool (854).

Top-Mount Freezer, Two-Door Refrigerators
Samsung (859) ranks highest in customer satisfaction among top-mount freezer refrigerators and is followed by LG (842).

Laundry Appliance Satisfaction Study

Front-Load Washers
Samsung and Whirlpool (883) rank highest in a tie in customer satisfaction among front-load washers.

Top-Load Washers
Samsung (872) ranks highest in customer satisfaction among top-load washers, followed by LG (850).

Clothes Dryers
Samsung (879) ranks highest in customer satisfaction among clothes dryers, followed by LG (867).

The 2020 Kitchen Appliance Satisfaction Study is based on 1,459 evaluations from customers who purchased cooktops; 1,518 evaluations from customers who purchased freestanding ranges; 1,301 evaluations from customers who purchased over-the-range microwaves; 1,347 evaluations from customers who purchased wall ovens; 1,482 evaluations from customers who purchased dishwashers; and 4,172 evaluations from customers who purchased refrigerators during the past 12 months. The study was fielded from January through April 2020.

The 2020 Laundry Appliance Satisfaction Study is based on 2,104 evaluations from customers who purchased clothes washers and 1,691 evaluations from customers who purchased clothes dryers during the past 12 months. The study was fielded from January through March 2020.

For more information about the JD Power Kitchen and Laundry Appliance Satisfaction Studies, visit https://www.jdpower.com/business/resource/us-kitchen-and-laundry-appliance-satisfaction-studies.

JD Power is a global leader in consumer insights, advisory services and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

JD Power is headquartered in Troy, Mich., and has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto shopping tool can be found at JDPower.com.

Media Relations Contacts
Geno Effler, JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; St. James, N.Y.; 631-584-2200; [email protected]

About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

 

Sales Recovery Sees Slight Pause in July; Consumer Expenditures Nearly Flat vs. 2019

2020-07-28

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The Retail Sales Forecast

New-vehicle retail sales in July are expected to be down from a year ago, according to a joint forecast developed jointly by JD Power and LMC Automotive. Retail sales are projected to reach 1,133,300 units, a 4.0% decrease compared with the JD Power pre-virus forecast and a 9.5% decrease compared with July 2019. Reporting the same numbers without controlling for the number of selling days translates to a decrease of 5.9% from a year ago. (Note: July 2020 contains one additional selling day than July 2019.)

The Total Sales Forecast

Total sales in July are projected to reach 1,211,700 units, a 16.4% decrease from July 2019. Reporting the same numbers without controlling for the number of selling days translates to a decrease of 13.1% from July 2019. The seasonally adjusted annualized rate (SAAR) for total sales is expected to be 14.3 million units, down 2.5 million units from a year ago.

The Takeaway

Thomas King, president of the data and analytics division at JD Power:

“July represents a slight pause in the overall recovery, with retail sales down 4-5% compared with the JD Power pre-virus forecast for the second consecutive month.” Among the top 100 U.S. markets, just eight of them are expected to post year-over-year sales gains. Notable markets among those expected to show gains include Detroit, Buffalo and Milwaukee.

“One factor contributing to the pause in recovery in July is inventory constraints for many vehicles,” King said. “While this is constraining overall sales, new production is arriving at dealerships daily and is being sold quickly to consumers.” This month, 41% of all vehicles sold will spend fewer than 20 days on dealer lots, up from 35% a year ago.

Incentive spending continues to fall from the record levels of April but remains up slightly from a year ago. Spending is on pace to reach $4,236 in July, an increase of $166 from July 2019. Reporting spending expressed as a percentage of the average vehicle MSRP is 10.3%, nearly flat from last year. “While the deals in market are still relatively strong, they aren’t exceptional like they were are few months ago,” King said. “This points to strong underlying consumer demand for new vehicles.”

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The shift in consumer demand toward more expensive trucks/SUVs continues to support record transaction prices in July. For the fourth consecutive month, trucks/SUVs are on pace to account for 76% of retail sales. As a result, transaction prices are expected to rise by 5.9% to $35,151, the highest ever for the month of July and second-highest level ever.

Record prices are helping to offset the decline in sales, with consumers expected to spend $39.8 billion on new vehicles in July. This represents a decline of only $139 million or 0.3% from a year ago.

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Through the first seven months of the year, retail sales are expected to reach 6.4 million units, a decline of 17% from a year ago. While this represents the slowest start to the year since 2011, prices in 2020 are soaring to the highest level ever. Average transaction prices through the first seven months are on pace to reach $34,634, an increase of 3.8% through the first seven months of 2019 and up 24.2% vs. the first seven months of 2011.

Consumers will spend $223 billion on new vehicles from January through July, a decline of $34 billion from a year ago—but an increase of more than $58 billion from the same period in 2011.

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Looking ahead, a quirk in the calendar and reduced inventory levels present some unique sales challenges in August. Typically, sales promotions related to the Labor Day holiday are pulled ahead into August due to the proximity of the holiday. This year, the Labor Day holiday occurs later in September, seven days after the end of August. “The unusual gap between the August close combined with reduced inventory levels means we may see less promotional activity at the end of the month,” King said. “As a result, August sales may appear to take a step back from the overall recovery pattern.”

Despite the volatility, retailers have adopted to the challenging environment and continue to post significant growth in margins on new-vehicle sales. Total grosses inclusive of finance and insurance incomes are on pace to reach $1,922 per unit, up $620 from last year and the highest level ever in July. King noted, “The strong per-unit grosses offer some mitigation to the lower sales pace.”

Sales & SAAR Comparison

JD Power U.S. Sales and SAAR Comparison

	July 20201	June 2020	July 2019
New-Vehicle Retail Sales	1,133,300 units (-9.5% lower than July 2019)2	1,008,908 units	1,204,236 units
Total Vehicle Sales	1,211,700 units (-16.4% lower than July 2019)2	1,114,443 units	1,393,771 units
Retail SAAR	13.0 million units	12.0 million units	14.1 million units
Total SAAR	14.3 million units	13.1 million units	16.8 million units

¹Figures cited for July 2020 are forecasted based on the first 15 selling days of the month.

²July 2020 has 26 selling days, one less more than July 2019.

The Details

• The average new-vehicle retail transaction price in July is expected to reach $35,151. The previous high for the month of July, $33,196, was set in July 2019.
• Average incentive spending per unit in July is expected to reach $4,236, up from the previous record for the month of $4,069, set in July 2019. Spending as a percentage of the average MSRP is 10.3%, up 0.1 percentage points from last year.
• Incentive spending on cars is expected to be up $269 to $3,886, while spending on trucks/SUVs is up $106 to $4,343.
• Consumers are on pace to spend $39.8 billion on new vehicles, down $139 million from July 2019.
• Truck/SUVs on pace to account for 75.5% of new-vehicle retail sales, the highest level ever for the month of July.
• Fleet sales are expected to total 78,300 units, down 60% from July 2019. Fleet volume is expected to account for 6.5% of total light-vehicle sales, down from 14% a year ago.
   

Global Outlook for July 2020

Jeff Schuster, president, Americas operations and global vehicle forecasts, LMC Automotive:
“The global automotive market continues on a resilient path of recovery, as June sales were down 17% from a year ago on strength in China and South Korea. Most key markets around the world are entering an important phase in the reopening that will test new procedures for manufacturing and the vehicle-selling process. Risk for the remainder of 2020 and into 2021 remains elevated but the market’s path forward is currently better than previously expected.”

Global light-vehicle sales through June YTD are down 27% from the same period in 2019 with improvement being seen in all markets from the low point in April. As prospects for an economic recovery continue, the global outlook for 2020 has been raised to a forecast of 73 million units, up from a low of 67 million forecasted in April. This is a decline of 20% from 2019.

Media Relations Contacts
Geno Effler; JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
Emmie Littlejohn; LMC Automotive; Troy, Mich.; 248-817-2100; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info

About LMC Automotive www.lmc-auto.com

 

 

Wireless Customer Care Satisfaction Remains High, JD Power Finds

2020-07-30

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With a steady flow of calls to wireless customer care representatives, who were moved from call centers to a shelter-in-place situation, great performance and great resolution remain intact during this critical time for wireless carriers, according to the JD Power 2020 U.S. Wireless Customer Care Performance Study^SM—Volume 2, released today.

“Just as we saw in our recent U.S. Wireless Network Quality Study, the high bar that carriers set in maintaining their network quality during these unprecedented times is also seen in their seamless delivery of customer care,” said Ian Greenblatt, managing director at JD Power.  “The industry faced incredible challenges keeping Americans connected and still remarkably have had no customer service disruption despite an unwavering call volume and an uprooted workforce.”

Study Results

T-Mobile ranks highest in Full-Service Carriers with a score of 852, followed by Verizon Wireless with 818.

Metro by T-Mobile ranks highest in Non-Contract Full-Service Carriers with a score of 827, followed by Cricket with 823.

Consumer Cellular ranks highest with Non-Contract Value Carriers with a score of 871.

The 2020 U.S. Wireless Customer Care Performance Study—Volume 2 is based on responses from 12,325 wireless customers who contacted their carrier’s customer care department within the past three months.  The studies evaluate customer care experiences across 12 different customer care channels: phone customer service reps; in-store contact; online chat; email; social media post; carrier app question post; automated telephone systems; website search; social media search; user forum; video from carrier; and carrier app search. The study was fielded from January through June 2020.

For more information about the U.S. Wireless Customer Care Performance Study, visit https://www.jdpower.com/business/tmt/us-wireless-customer-care-performance-study.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, Asia Pacific and Europe.

Media Relations Contacts
Geno Effler, JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; Huntington, NY.; 631-584-2200; [email protected]

 

Recent Retail Pharmacy Health and Wellness Services Offer Glimpse into Future of Healthcare, JD Power Finds

2020-08-04

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Those pharmacist consultation kiosks, exam rooms and walk-in vaccination sites popping up in neighborhood pharmacies across the country are not a coincidence. They are part of a concerted effort by the nation’s major pharmacy chains to become the center of gravity for consumer healthcare. According to the JD Power 2020 U.S. Pharmacy Study,^SM released today, the strategy is working, with pharmacy expansion into primary care driving significant increases in both satisfaction and consumer spending.

“When you look at the major pharmacy business trends of the past couple of years—CVS acquiring Aetna, Walgreens partnering with Humana and Walmart moving into health insurance—it’s clear that pharmacy operators are positioning themselves to become hubs of consumer healthcare, edging into the space once reserved for primary care physicians’ offices,” said James Beem, Managing Director of Healthcare Intelligence at JD Power. “What has not been clear until now is exactly how consumers would react to the shift. Simply put, they’re embracing it, and it’s driving higher overall satisfaction and increased spending as they use more health and wellness-oriented services.”

Following are some of the key findings of the 2020 study:

• Use of health and wellness services grows, driving higher satisfaction: Nearly half (48%) of retail pharmacy customers have used at least one health and wellness-oriented service provided by their pharmacy this year, up a significant 5 percentage points from 2019. More importantly, overall customer satisfaction with the retail pharmacy is 26 points higher (on a 1,000-point scale) among customers who use health and wellness services vs. those who have not.
• Deeper penetration into primary care drives increased satisfaction and spending: Customers who use at least one health and wellness-oriented service provided by their pharmacy spend an average of $11 more per customer than those who do not use these services ($35 vs. $24, respectively). When customers use two or more health and wellness-oriented services, that average spend climbs to $58. Among customers who use two or more health and wellness-oriented services, overall satisfaction jumps to 907 vs. 861 for those who don’t use any service.
• Digital ordering drives high levels of satisfaction, but utilization remains low: Just 9% of brick-and-mortar pharmacy customers order their prescriptions via digital channels. Despite the stubbornly low utilization rate, overall satisfaction among those customers who do order digitally through a brick-and-mortar pharmacy is 859, which is 5 points higher than among those who only visit the store in person. By contrast, mail-order pharmacy customers are far more frequent users of digital ordering, with 32% ordering prescriptions via digital channels. These mail-order digital customers have even higher levels of satisfaction, with an overall satisfaction score of 867.
• Key influencers important to health and wellness services utilization: Physician recommendations for pharmacy-delivered health and wellness services are associated with an 80% utilization rate and recommendations from friends and family are associated with a 75% utilization rate. However, just 8% of customers say they’ve received a recommendation from their doctor and 9% have received a recommendation from friends and family. The most common means of hearing about these services is in-store advertising, which drives a 45% utilization rate.

Study Rankings

Good Neighbor Pharmacy ranks highest among brick-and-mortar chain drug store pharmacies for a fourth consecutive year, with a score of 915. Health Mart (905) ranks second and Rite Aid Pharmacy ranks third (861).

Sam’s Club ranks highest among brick-and-mortar mass merchandiser pharmacies for a fifth consecutive year, with a score of 885. Costco and CVS/pharmacy inside Target (870 each) rank second in a tie.

Wegmans ranks highest among brick-and-mortar supermarket pharmacies for a third consecutive year, with a score of 904. Publix (889) ranks second and Winn-Dixie ranks third (883).

Humana Pharmacy ranks highest in the mail order segment for a third consecutive year, with a score of 904. OptumRx (886) ranks second and Kaiser Permanente Pharmacy (883) ranks third.

The U.S. Pharmacy Study, now in its 12th year, measures customer satisfaction with brick-and-mortar and mail order pharmacies. The 2020 study is based on responses from 13,378 pharmacy customers who filled a prescription during the three months prior to the survey period of September 2019-May 2020.

For more information about the U.S. Pharmacy Study, visit https://www.jdpower.com/business/resource/us-pharmacy-study.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, Asia Pacific and Europe.

Media Relations Contacts
Geno Effler, JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; Huntington, NY.; 631-584-2200; [email protected]

About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

 

 

Consumers Are More Likely to Post Online Reviews for Larger Ticket Home Improvement Items, JD Power Finds

2020-08-05

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Relative to other JD Power @home categories such as laundry appliance, kitchen appliance, vacuum and paint, the JD Power 2020 U.S. Windows and Patio Doors Satisfaction Study^SM finds customers who purchased windows and patio doors are the most likely to post a review online. The common theme is that as the average price point and the time invested in the shopping process increases, the more inclined customers are to go online and share their experience with others.

“Not only are window and patio door purchasers more likely to post online reviews, they are doing so at an increasing rate,” said Christina Cooley, director of the @home practice at JD Power. “This year more than one-third of window purchasers posted a review compared with one-fourth last year. Since customers are taking their time to post a review for the next person, especially on Facebook, manufacturers and retailers alike must continue to keep a presence in social media and use it as an opportunity to connect with their customers and leverage them as brand advocates.”

Study Rankings

Renewal by Andersen ranks highest in the manufacturer segment with a score of 891, followed by Infinity from Marvin (879) and Champion (878).

Renewal by Andersen also ranks highest in the retail segment with a score of 890. Window World ranks second with a score of 883.

The 2020 U.S. Windows and Patio Doors Satisfaction Study is based on responses from 3,193 customers who purchased windows or patio doors within the previous 12 months, with 1,136 purchasing from one of the retailers profiled within the study. The study was fielded in January-May 2020.

For more information about the U.S. Windows and Patio Doors Satisfaction Study, visit https://www.jdpower.com/business/home/windows-and-patio-doors-satisfaction-study.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, Asia Pacific and Europe.

Media Relations Contacts
Geno Effler; JD Power; 714-621-6224; [email protected]
John Roderick; St. James, N.Y.; 631-584-2200; [email protected]

About JD Power and Advertising/Promotional Rules: http://www.jdpower.com/business/about-us/press-release-info

 

Direct-to-Consumer Auto Insurers Take Top Honors in Shopping Study as New Normal Arrives for P&C Industry, JD Power Finds

2020-04-29

TROY, Mich.: 30 April 2020 — Two insurance carriers—GEICO and Progressive—captured nearly 92% of all premium growth in the past year, putting an exclamation point on a trend toward increased adoption of direct-to-consumer auto insurance that has been building for several years. According to the JD Power 2020 U.S. Insurance Shopping Study,^SM released today, this trend is likely to get a further boost as customers increasingly pivot to convenience and value, in response to the COVID-19 pandemic.

“Over the past decade, auto insurance costs have risen at two times the rate of inflation,” said Tom Super, head of property & casualty insurance at JD Power. “That’s consuming a larger share of discretionary income and playing an increasingly significant role in household finances. Add the effects of record high levels of unemployment and the 52% of auto insurance customers who say they plan to either reduce coverage, shop for another carrier or switch to another carrier because of COVID-19¹, and the outcome for the industry is clear: price is going to be a bigger factor. Direct insurers are in the best position right now to benefit from this trend due to their cost-of-acquisition advantages, but there’s more to acquiring—and retaining—customers than price alone. Customers who have a poor experience are eight times more likely to shop than those who do not, and brand perception remains critical.”

Following are some key findings of the 2020 study:

• Little loyalty in auto insurance market: Prior to the COVID-19 pandemic, 77% of auto insurance customers were either actively shopping or experienced an adverse event that triggered shopping (e.g., poor service or a rate increase). Softening market conditions have done little in the way of stemming the tide of eroding brand loyalty. According to a JD Power pulse survey conducted April 14 when the COVID-19 pandemic was rampant, 52% of auto insurance customers said they plan to manage the cost of insurance by either reducing coverage, shopping for another carrier or switching to another carrier because of COVID-19.

• Price continues to become bigger factor in customer satisfaction: Since 2012, the price factor measured in the study has increased by 54% as a key driver of satisfaction with the purchase experience. At the same time, there is a growing gap in overall satisfaction vs. price satisfaction. In the past decade, customers have become generally more satisfied with their current insurer in all areas except price.

• Direct models click with customers: Several structural advantages are helping direct insurers reset the auto insurance leaderboard. For one, lower commissions and administrative expenses enable direct carriers to enjoy a 10-percentage point cost advantage vs. exclusive and independent agent carriers. From a technology standpoint, 90% of customers say they are open to purchasing their auto insurance online. Direct carriers have taken seven percentage points of market share from agent insurers in the past decade, and this year earn the highest scores in every factor comprising the purchase experience in this study.

• Poor customer experience is loyalty death knell: The primary drivers that push customers to shop are negative service experiences and price-related factors. Customers who express price frustration are five times more likely to shop and those who experience poor service are eight times more likely to shop.

• Yes, all that advertising does matter: A reflection that the personal lines auto market is functioning more as a consumer product, large insurers continue to take share from mid- and small-size carriers. Brand factors, including reputation and long-term viability, are key facilitators of converting shoppers to consider and quote a brand. Brand attributes such as convenience, leadership and clear messaging are associated with brands that have higher sales conversion rates. Moreover, brands recalled by shoppers on an unaided basis are four times more likely to be quoted than brands only recognized on an aided basis, which illustrates the effectiveness of insurers’ extensive marketing initiatives.

Study Rankings

GEICO ranks highest among large auto insurers in providing a satisfying purchase experience, with a score of 867 (on a 1,000-point scale). Nationwide (862) ranks second and State Farm (860) ranks third.

The Hartford ranks highest among mid-size auto insurers, with a score of 895. Erie Insurance (880) ranks second and American Family (878) ranks third.

Now in its 14^th year, the U.S. Insurance Shopping Study underwent a significant redesign for 2020. The study now captures advanced insight into each stage of the shopping funnel and a new index and award structure, which adds the quoting process to the overall customer satisfaction index. It also now measures auto insurance shopping, purchase behavior and purchase experience satisfaction in two categories: large insurers and mid-size insurers.

The study is based on responses from more than 14,300 insurance customers who requested an auto insurance price quote from at least one competitive insurer in the past nine months. The study was fielded from April 2019 through January 2020.

For more information about the U.S. Insurance Shopping Study, visit

https://www.jdpower.com/business/resource/jd-power-us-insurance-shopping-study.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, Asia Pacific and Europe.

Media Relations Contacts
Geno Effler, JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; Huntington, NY.; 631-584-2200; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info.

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¹Source: Auto Insurance During COVID-19 – Premium Relief: Consumer Impact and Outlook, JD Power

 

Retail Banks Face Major Customer Satisfaction Challenge as World Shifts to Digital-Only Engagement, JD Power Finds

2020-04-29

TROY, Mich.: 30 April 2020 — Retail banks have been confronting a difficult paradox for the last several years. The most satisfied retail banking customers use both branch and digital services to conduct their personal banking, while the least satisfied are those who have a digital-only relationship with their bank and do not use branches.

Now, as the COVID-19 pandemic places constraints on in-person retail banking and forces customers to increase reliance on digital service channels, banks are facing an important test. According to the JD Power 2020 U.S. Retail Banking Satisfaction Study,^SM released today, 52% of retail bank customers classified as branch dependent before the COVID-19 pandemic, and successfully transitioning them to digital—without compromising customer experience—will be critical in the weeks and months ahead.

“With fewer customers visiting branches, it will be important for retail banks to replace the in-person service they would have provided with personalized services delivered instead through digital channels,” said Paul McAdam, senior director, banking intelligence at JD Power. “Given the technology available to banks, customer pain points with digital should be easy to address. Let’s keep in mind that digital retail banking was introduced 25 years ago. Executing basic user-friendly functionality, providing a full range of services and offering easy ways to pay and move money are areas where banks could improve their digital offerings.”

Following are some key findings of the 2020 study:

• Pre-pandemic, branches still played major role:  Prior to the COVID-19 pandemic, 52% of retail bank customers were classified as branch dependent, meaning they either used the branch exclusively (10% of customers) or used a combination of branch visits, online and mobile banking service (42% of customers) during the past three months. Branch-dependent customers visit a branch an average of 1.5 times per month. Following 25 years of bank investment in providing and upgrading digital offerings and customers’ increased adoption of them, 30% of bank customers now do their banking in a digital-only manner and do not use branches.
   
• Digital-only customers have lowest levels of satisfaction: Overall customer satisfaction with retail banks tends to decline as customers transition away from the branch and to digital-only banking relationships. The overall satisfaction score among branch-dependent bank customers is 824 (on a 1,000-point scale), which is 23 points higher than the score among digital-only customers. That satisfaction gap is widest (31 points) among members of Generation Y.¹
   
• Big banks lead midsize and regional banks on digital engagement: The Big 6² banks currently have a jump on regional and midsize banks to build digital engagement. Prior to the pandemic, 49% of big bank customers had high levels of digital engagement, compared with 41% of regional bank customers and 36% of midsize bank customers.
   
• P2P payment integration emerges as wild card for bank customer satisfaction: Satisfaction is significantly higher among customers who have linked their bank accounts to digital payment services (e.g., Zelle, Apple Pay, PayPal, Venmo) than among those who have not. Among P2P (person to person) payment providers, direct integration with Zelle generates the highest boost in bank customer satisfaction.

The study measures customer satisfaction with banks in 11 geographic regions. Highest-ranking banks and scores, by region, are as follows:

California Region: Chase (825)
Florida Region: Chase (851)
Mid-Atlantic Region: S&T Bank (871)
Midwest Region: First National Bank of Omaha (847)
New England Region: Bangor Savings Bank (863)
North Central Region: City National Bank (WV) (857)
Northwest Region: Columbia Bank (837)
South Central Region: Arvest Bank (863)
Southeast Region: United Community Bank (862)
Southwest Region: Arvest Bank (851)
Texas Region: Frost Bank (863)

The U.S. Retail Banking Satisfaction Study, now in its 15^th year, measures satisfaction in six factors (listed in alphabetical order): account opening; communication and advice; channel activities; convenience; problem resolution; and products and fees. Channel activities include seven subfactors (listed in alphabetical order): ATM; assisted online; branch; call center; IVR; mobile; and website.

The study is based on responses from 91,950 retail banking customers of 182 of the largest banks in the United States regarding their experiences with their retail bank. It was fielded from April 2019 through February 2020.  Big banks are defined as banks with more than $250 billion in domestic deposits; regional banks are those with $55 billion-$250 billion in domestic deposits; and midsize banks are those with less than $55 billion in domestic deposits.

For more information about the JD Power U.S. Retail Banking Satisfaction Study, visit https://www.jdpower.com/business/resource/us-retail-banking-satisfaction-study.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, Asia Pacific and Europe.

Media Relations Contacts
Geno Effler, JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; Huntington, NY.; 631-584-2200; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info.

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¹JD Power defines generational groups as Pre-Boomers (born before 1946); Boomers (1946-1964); Gen X (1965-1976); Gen Y (1977-1994); and Gen Z (1995-2004). Millennials (1982-1994) are a subset of Gen Y.

²The Big 6 banks are Bank of America, Chase, Citibank, PNC, U.S. Bank and Wells Fargo.

 

Bottled or Tap? 25% of Americans Never Drink Their Tap Water, JD Power Finds

2020-05-04

jillian.breska

TROY, Mich.: 6 May 2020 — As the Environmental Protection Agency (EPA) moves closer to implementing regulations for PFAS¹ (per- and polyfluoroalkyl substances), commonly referred to as “forever chemicals,” in the U.S. drinking water supply, many Americans are “just saying no” to tap water. According to the JD Power 2020 U.S. Water Utility Residential Customer Satisfaction Study,^SM released today, 25% of Americans say they never drink their tap water, setting the stage for a serious set of customer satisfaction challenges on the part of regional water utilities.

“A combination of bad taste, bad smell, high mineral content and general fears about water safety are prompting a sizable portion of Americans—particularly in Western and Southern states—to avoid drinking their tap water,” said Andrew Heath, senior director of utilities intelligence at JD Power. “Fixing these problems requires a significant focus on infrastructure, both to ensure water quality and to communicate with customers, showing them proof that infrastructure is well maintained and that the water is safe.”

Following are key findings of the 2020 study:

• One in four customers never drink their tap water: One-fourth (25%) of residential water utility customers nationwide say they never drink their tap water. Overall customer satisfaction with the local water utility is 52 points lower (on a 1,000-point scale) among customers who never drink their tap water vs. among those who say they always drink their tap water.
• Bad taste is hard to swallow: Among specific water quality issues that drive the decision to not consume tap water, the biggest deterrents are bad taste (11%); bad smell (10%); poor clarity (8%); scaling/water hardness (8%); and high lead/mineral content (5%).
• Annual water quality report: Water utilities are required to test the tap water and publish an annual Consumer Confidence Report to reassure their customers that it’s safe to drink. Unfortunately, only 40% of customers recall seeing or receiving this report but, when they do, 80% of them then say they drink the tap water.
• Household water use increases during COVID-19, but misinformation persists: Water consumption has increased significantly during the COVID-19 pandemic, with 36% of households saying they are consuming more water than they did previously, which includes drinking 18% more glasses of water and doubling the number of times they wash their hands. Despite evidence to the contrary provided by the Centers for Disease Control, 41% of water utility customers across the country express concern regarding the transmission of COVID-19 through their drinking water supply.²
• Proactive communications have powerful effect, but few utilities deliver: Overall satisfaction scores are 106 points higher when customers recall receiving four or more proactive communications from their utility (e.g., phone call, email, text message or social media message) than when customers do not recall a proactive communication. Despite the powerful effect proactive communications have on customer satisfaction, just 5% of water utility customers recall receiving four or more communications from their utility. Less than one-third (30%) of customers recall receiving any communications from their water utility.
• Digital shows promise in closing communications gap: Across electric, gas and water utilities, customer satisfaction improves significantly when customers use their utility’s mobile apps and websites. Overall satisfaction among utility customers using digital only channels is 788, compared with 754 among those who use the phone only and 715 among those who have no interaction.³

Study Rankings by Region

The study measures customer satisfaction with water utilities in eight geographic regions. Highest-ranking utilities and scores, by region, are as follows:

• Midwest Large: Illinois American Water (764)
• Midwest Midsize: City of Minneapolis (757)
• Northeast Large: NYC Environmental Protection (778)
• Northeast Midsize: Monroe County Water Authority (774)
• South Large: Gwinnett County (781)
• South Midsize: Orange County Utilities (789)
• West Large: Seattle Public Utilities (764)
• West Midsize: Irvine Ranch Water District (752)

The U.S. Water Utility Residential Customer Satisfaction Study, now in its fifth year, measures satisfaction among residential customers of 90 water utilities that deliver water to at least 400,000 customers and is reported in four geographic regions and two size categories: Midwest Large, Midwest Midsize, Northeast Large, Northeast Midsize, South Large, South Midsize, West Large and West Midsize. Overall satisfaction is measured by examining 33 attributes in six factors (listed in order of importance): quality and reliability; price; conservation; billing and payment; communications; and customer service.

For more information about the U.S. Water Utility Residential Customer Satisfaction Study, visit https://www.jdpower.com/resource/water-utility-residential-customer-satisfaction-study.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, Asia Pacific and Europe.

Media Relations Contacts
Geno Effler, JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; Huntington, NY.; 631-584-2200; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info

¹EPA Announces Proposed Decision to Regulate PFOA and PFOS in Drinking Water, U.S. EPA, Feb. 2, 2020
²Water Utilities – Pulse Survey: COVID-19 Impact, JD Power, April 30, 2020
³JD Power 2020 Utility Digital Experience Study,^SM JD Power, Feb. 26, 2020

 

Satisfied Vacuum Purchasers Serve as Brand Advocates, JD Power Finds

2020-05-13

jillian.breska

TROY, Mich.: 13 May 2020 — With 44% of vacuum purchases taking place online—and currently limited shopping in stores—word of mouth is playing a more significant role in vacuum purchases, according to the JD Power 2020 Vacuum Satisfaction Study,^SM released today.

“The fielding of this study took place pre-pandemic and we found then that more consumers were making their vacuum purchases online,” said Christina Cooley, director of the @Home practice at JD Power. “With minimal retail shopping taking place during this time, creating an inability to physically touch and feel vacuums in stores, manufacturers have an opportunity to use their current customer-base as brand advocates to further encourage online vacuum purchases.”

Study results show that those who received recommendations from friends and family during the shopping process were more likely to purchase online, are more satisfied with their experience, and are now providing more positive recommendations to others. 

Study Rankings

Dyson ranks highest in the canister segment with a score of 847. Miele (844) ranks second and Dirt Devil (833) ranks third.

Dyson ranks highest in the stick segment with a score of 859. Shark (855) ranks second.

Shark ranks highest in the upright segment with a score of 867. Dyson (853) ranks second.

The 2020 Vacuum Satisfaction Study is based on responses from 3,828 customers who purchased an upright, stick and/or canister vacuum in the past 12 months. The study was fielded from January-March 2020.

For more information about the U.S. Vacuum Satisfaction Study, visit https://www.jdpower.com/business/home/vacuum-customer-satisfaction-study.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, Asia Pacific and Europe.

Media Relations Contacts
Geno Effler; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; St. James, N.Y.; 631-584-2200; [email protected]

About JD Power and Advertising/Promotional Rules: http://www.jdpower.com/business/about-us/press-release-info