Category: United States

Highest-Ranked Online Travel Agencies Excel in Effectiveness of Website;
Price Continues to be a Key Driver of Customer Satisfaction

2014-04-29

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WESTLAKE VILLAGE, Calif.: 30 April 2014 — While price continues to be an important factor driving customer satisfaction with online travel agencies, the highest-performing agencies excel by providing a superior website/online store experience, with clear layout and design, ease of navigation and useful information, according to the JD Power 2014 Online Travel Agency Satisfaction Report^SM released today.

“In today’s competitive market, offering a low price is a necessity but does not automatically ensure customer satisfaction,” said Rick Garlick, global travel and hospitality practice lead at JD Power. “Online travel agencies need to provide a user-friendly Web experience to meet customer expectations. If the site does not function well or provide the kind of information customers expect, they will either move on to a competitor’s website or phone the agency’s call center, costing the agency time and money.”

The report measures overall customer satisfaction with the purchase experience when buying a vacation package, flight, hotel or rental car using an online travel website. Seven factors are examined in the report (listed in order of importance): competitiveness of pricing; usefulness of information; availability of booking/reservation options; website/online store; ease of booking/reserving; competitiveness of sales and promotions; and contact with customer service.

KEY FINDINGS

Overall customer satisfaction with online travel agencies is 788 (on a 1,000-point scale).

• The primary reasons customers book/reserve/purchase from an online travel agency website are price (66%); past experience with the brand (44%); brand reputation (22%); and positive reviews of the brand (website, article, blog, etc.) (19%).
• The highest percentage of customers visiting online travel websites book hotels (58%); followed by flight reservations (52%); vacation packages (33%); and rental cars (31%).
• High levels of satisfaction translate into higher repurchase rates. Customers who rate overall satisfaction as outstanding (10 on a 10-point scale) purchase from an online travel website 4.4 times per year, compared with 3.1 times among those who rate their satisfaction as average.
• Problem resolution has a substantial impact on customer satisfaction. Generally, customers use online travel sites because they involve an inexpensive, low contact process. When problems occur and they are resolved quickly, customers are surprised and respond positively. Nearly one-fifth (18%) of customers indicate they had a problem booking reservations online. Not surprisingly, satisfaction among these customers (754) is 44 points lower than among those who don’t experience problems. However, when problems can be resolved quickly via website, satisfaction can be salvaged, improving to 780 when problems are resolved from 634 when they remain unresolved. Online travel sites able to resolve customer problems will likely reap the benefit of product differentiation.

Online Travel Agency Satisfaction Rankings

Travelocity.com ranks highest with a score of 804, performing well in website/online store; usefulness of information; and competitiveness of sales and promotions. Following in the rankings is Expedia.com (798), performing well in the contact with customer service factor.

The 2014 Online Travel Agency Satisfaction Report is based on responses from 2,673 customers who made an online purchase from an independent travel website during the past 12 months. The study was fielded from March 11, 2014, through March 31, 2014.

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

About McGraw Hill Financial www.mhfi.com 

Customer Satisfaction with Banks at All-Time High, but Areas of Weakness Signal Competitive Vulnerability

2014-04-30

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WESTLAKE VILLAGE, Calif.: 1 May 2014 — Despite ongoing public scrutiny, customer satisfaction with banks is at a record high as banks improve experiences for their customers, reduce problems and create a better understanding of fees, according to the JD Power 2014 U.S. Retail Banking Satisfaction Study^SM released today. Yet, midsize banks are missing the mark with key audience segments, such as millennials (born 1977-1995) and minorities, with affluent customers still the least-satisfied customer segment.

“Midsize[1] banks are falling behind in meeting the needs of the fastest growing demographic groups, millennials and minorities, especially in online, mobile and problem resolution,” said Jim Miller, director of banking services at JD Power. “If midsize banks don’t change their focus to adjust to demographic shifts, they are extremely vulnerable and risk losing market share to competitors and becoming irrelevant.”

Improving consumer sentiment with the economy and personal finances has helped lift overall satisfaction with retail banks to 785 (on a 1,000-point scale) in 2014, up from 763 in 2013. Bank customers are experiencing fewer problems; when problems do occur, they are more satisfied with how they are resolved. Discontent with fees has declined, with fees satisfaction rising 46 points to 669, the highest level since before the 2010 study re-design.

However, not all customers feel the same. Banks are not meeting the needs of affluent customers, the least-satisfied segment. Expectations for personalized experiences are high among affluent customers, and banks have not provided a differentiated experience to meet those expectations.

“It’s remarkable that banks are failing to satisfy affluent customers, especially with deposits and liquidity so important to the life of a financial institution,” said Miller. “As boomers age, the country is poised for a huge transfer of wealth in upcoming years. As this occurs, those banks that have satisfied the affluent segment will be more competitively positioned to prosper.”

KEY FINDINGS

• Overall satisfaction among big banks improves 23 points to 782, while midsize banks improve only 11 points to 796 and regional banks improve 24 points to 784.
• Midsize banks have held a strong lead with satisfaction among affluent customers; however, big banks have closed the gap with a 40-point improvement. Satisfaction with midsize banks declines by 6 points among affluent customers, while regional banks improve 30 points among affluent customers.
• In 2014, 16 percent of customers have experienced a problem or had a complaint, down from 18 percent in 2013 and 24 percent in 2010.
• Satisfaction with the problem resolution process has improved to 620 in 2014 from 595 in 2013.
• Among customers who switched banks during the past 12 months, the most common reasons are poor customer service (28%); branches are not conveniently located (21%); and interest rates are not competitive (19%). Only 15 percent of these customers cite high fees as a primary reason for switching.

Also, while overall banking satisfaction is at an all-time high, not all banks are serving their customers’ needs effectively.

According to Miller, “Even with record high satisfaction, there are some banks that fall far short in meeting customer needs. It is easy for banks to become complacent. To stay at the top of their game, banks should focus on those customers who are not satisfied. And consumers should keep in mind they have the opportunity to shop banks to find the right combination of services, products and fees to meet their needs.”

JD Power offers the following tips for consumers:

• Make sure you review your account and keep track of the fees you are paying. Contact your bank to see if there are lower cost product options or shop other banks to understand your alternatives.
• Find a bank that delivers well on how you want to bank. With a little research, you can find a bank that makes it easy to bank when, where and how you want. If you prefer to bank remotely, what type of mobile and online services does your bank offer? Can you deposit a check with your smartphone? If you prefer to bank in person, how convenient are the branch locations and hours?
• Visit jdpower.com to view satisfaction rankings on banks in your region.

The ninth annual customer satisfaction study is the longest-running and most in-depth survey of the retail banking industry, with more than 80,000 customers covering various aspects of their banking experience. The study measures satisfaction in six factors: account information; channel activities; facility; fees; problem resolution; and product offerings. Banks are ranked based on overall customer satisfaction in each of the following regions: California, Florida, Mid-Atlantic, Midwest, New England, North Central, Northwest, South Central, Southeast, Southwest and Texas.

The study measures customer satisfaction with banks in 11 regions. Study results by region are:

California Region: Rabobank ranks highest in the California region with a score of 832 and performs particularly well in the account information, fees and channel activities factors. Following Rabobank in the rankings are Bank of the West, Chase, U.S. Bank and Wells Fargo in a tie (796 each).

Florida Region: Chase ranks highest in the Florida region with a score of 826, performing particularly well in the facility and channel activities factors. TD Bank (823) and SunTrust (814) follow in the rankings.

Mid-Atlantic Region: Northwest Savings Bank ranks highest in the region with a score of 832 and performs particularly well in the product offerings factor. Susquehanna Bank (829) and National Penn Bank (825) follow in the rankings.

Midwest Region: First Midwest Bank ranks highest in the region with a score of 813 and performs particularly well in the facility, account information and channel activities factors. Following First Midwest Bank in the rankings are Commerce Bank (801) and AnchorBank and UMB Bank in a tie (799 each).

New England Region: Eastern Bank ranks highest in the region with a score of 817 and performs particularly well in the account information and fees factors. Rockland Trust Co. (810) and Webster Bank (794) follow in the rankings.  

North Central Region: With a score of 828, Huntington National Bank ranks highest in the region, performing particularly well in the product offerings, account information and fees factors. Following in the rankings are Regions Bank (816) and Flagstar Bank (809).

Northwest Region: Umpqua Bank ranks highest in the region with a score of 841 and performs particularly well in the product offerings, facility, account information, fees and channel activities factors. U.S. Bank (793) and Sterling Bank (791) follow in the rankings.

South Central Region: Arvest Bank ranks highest in the region with a score of 843, performing particularly well in the product offerings, facility, account information and channel activities factors. Following in the rankings are PNC Bank and Trustmark National Bank in a tie (816 each).

Southeast Region: United Community Bank ranks highest in the region with a score of 854 and performs particularly well in the product offerings, facility, account information, fees and channel activities factors. Following United Community Bank in the rankings are First Citizens Bancorp (836) and Branch Banking & Trust (BB&T) and First Citizens Bancshares in a tie (815 each).

Southwest Region: With a score of 831, Arvest Bank ranks highest in the region, performing particularly well in the product offerings, facility, account information, fees and channel activities factors. MidFirst Bank (822) and Chase (814) follow in the rankings.

Texas Region: Frost Bank ranks highest in the Texas region with a score of 856, and performs particularly well in the product offerings, account activities, fees and account information factors. Woodforest National Bank (843) and Amegy Bank (812) follow in the rankings.

The 2014 U.S. Retail Banking Satisfaction Study is based on responses from more than 80,000 retail banking customers of more than 130 of the largest banks in the United States regarding their experiences with their retail bank. The study was fielded quarterly from April 2013 to February 2014:

Wave 1: April 1, 2013 – April 26, 2013

Wave 2: July 1, 2013 – July 29, 2013

Wave 3: October 1, 2013 – October 28, 2013

Wave 4: January 9, 2014 – January 31, 2014

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

About McGraw Hill Financial www.mhfi.com

[1] Big banks are defined as the six largest financial institutions based on total deposits as reported by the FDIC, averaging $180 billion and above. Regional banks are defined as those with between $180 billion and $33 billion in deposits. Midsize banks are defined as those with between $33 billion and $2 billion in deposits.

Overall Tablet Satisfaction Declines as More Value-Priced Brands Vie for Market Share

2014-05-05

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WESTLAKE VILLAGE, Calif: 7 May 2014 — As more value-priced brands enter the marketplace and the average purchase price of tablets declines, overall tablet satisfaction declines, according to the JD Power 2014 U.S. Tablet Satisfaction Study^SM—Volume 1 released today.

“Since the inaugural U.S. Tablet Satisfaction Study in 2012, a number of new tablet OEMs have entered the U.S. marketplace, differentiating themselves to satisfy a growing interest in owning a tablet,” said Kirk Parsons, senior director of telecommunications services at JD Power. “Price has significantly impacted the marketplace. The average purchase price continues to drop and consumer expectations of tablet performance and features are different than they were for past products. Subsequently, overall satisfaction has declined, especially with ease of operation, as navigation features and functions have changed.”

KEY FINDINGS

• Lower price is the No.1 reason for tablet choice in 2014, with 25 percent of current tablet owners citing price as the main reason for selecting their current brand, compared with 21 percent in 2013. Features offered and brand reputation are the next most-frequently cited reasons for selecting a tablet device (22% and 21%, respectively).

• Since 2012, the average purchase price of a tablet has decreased by $53 ($337 in 2014 vs. $390 in 2012). 
• Overall satisfaction has decreased by 18 points to 835 on a 1,000-point scale in 2014 from 853 in 2012. The largest decline in satisfaction is in the ease of operation factor, with substantial decreases in two attributes over the three-year time frame: navigation (8.30 vs. 8.52, respectively, on a 10-point scale) and adjusting tablet settings (8.30 vs. 8.50, respectively).
• It’s taking longer for tablet owners to perform the initial set-up on their devices in 2014 than three years ago, as more features and pre-loaded apps are included with the device. In 2014, the average time for initial tablet set-up is 64 minutes, compared with 55 minutes in 2012. 
• Prior to purchasing a tablet, 50 percent of consumers rely on brand reputation to help drive their brand purchase decision—an increase from 42 percent just six months ago. Manufacturer websites (47%) and recommendations from friends, family members or colleagues (46%) are key drivers of brand purchase choice.

Apple ranks highest in overall satisfaction with a score of 830 and performs highest in all study factors except cost. Samsung ranks second with a score of 822 and achieves above-average scores in the features, styling and design, and cost factors.

The 2014 U.S. Tablet Satisfaction Study—Volume 1 is based on experiences evaluated by 2,513 tablet owners who have owned their current device for less than one year. The study was fielded between September 2013 and February 2014. The study measures satisfaction across five factors (in order of importance): performance (28%); ease of operation (22%); features (22%); styling and design (17%); and cost (11%).

Media Relations Contacts

John Tews; Troy, Mich.; 248-680-6218; [email protected]

Syvetril Perryman; Westlake Village, Calif.; 805-418-8103; [email protected]

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

About McGraw Hill Financial www.mhfi.com 

JD Power Reports: One in 10 Canadian Customers Switch Auto Insurance Carriers

2014-05-05

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TORONTO: 6 May 2014 — One in five auto insurance customers in Canada have shopped for a new insurer in the past 12 months and 9% have switched, according to the JD Power 2014 Canadian Auto Insurance Satisfaction Study^SM released today.

Ultimately, each insurance company conquests less than an average of 1 percent of customers shopping for a new insurance policy. Brand awareness limits most carriers’ ability to attract shoppers, as they typically limit their search to an average of only 1.5 quotes.

“Even the largest national insurance companies have limited awareness,” said Jeremy Bowler, senior director of the insurance practice at JD Power. “Some of the big carriers may be well-known in one city or province, but have little or no awareness outside of that market. To grow their business, they need to build brand awareness, which traditionally requires significant advertising investment.”

Once an insurer wins a new customer, every touch point they have with that customer is crucial and can be the difference between a loyal customer and a defector. Study findings show that the three most critical touch points are the annual or semi-annual renewal notice; when a customer contacts their insurer for non-claims-related reasons (62% of customers have contacted their insurer either directly or through an agent in the past 12 months regarding a non-claim-related issue); and when a customer files a claim (12% of customers filed an auto claim in the past year).

KEY FINDINGS

• Price, historically a key differentiator among insurance companies, is having less impact on overall customer satisfaction. Price satisfaction is highest in Quebec, primarily because the government insures against injuries to people, thus bodily injury coverage is not required for vehicle owners, keeping premiums lower than in other provinces. In Ontario, auto insurance is regulated by the Financial Services Commission of Ontario, which in 2013 implemented its Auto Insurance Cost and Rate Reduction Strategy, contributing to an increase in price satisfaction of 6 points (on a 1,000-point scale).
• The average growth rate among all insurers included in the study is 4 percent. The largest growth rate is 24 percent, while the largest attrition rate is 11 percent.
• Across the three provinces in the study, overall customer satisfaction drops to 758 in 2014 from 766 in 2013. Declines in satisfaction with claims (-29 points), interaction (-13) and billing and payment (-12) account for the majority of the year-over-year drop. Price is the only factor in which satisfaction improves.

The study, now in its seventh year, measures insurance customer experiences with their primary auto insurer in Canada. Customer satisfaction is measured across five factors (in order of importance): interaction; price; policy offerings; billing and payment; and claims. Insurers are ranked in three provinces: Ontario, Alberta and Quebec.

Regional Rankings

Customer satisfaction in Alberta averages 744, down 3 points from from 2013. Co-operators ranks highest in customer satisfaction in Alberta with a score of 782. Alberta Motor Association ranks second (770), followed by Johnson Insurance (754).

Customer satisfaction in Ontario averages 749, down 7 points from 2013. Belairdirect (784) ranks highest in Ontario, followed by CAA Insurance Company (778) and State Farm (773).

Customer satisfaction in Quebec improves 2 points in 2014 to 804. In Quebec, The Personal ranks highest for a second consecutive year, with a score of 837. La Capitale ranks second (821) and Desjardins General Insurance (805) third.

The 2014 Canadian Auto Insurance Satisfaction Study is based on responses from nearly 9,910 auto insurance policyholders. The study was fielded in January and February 2014.

Media Relations Contacts

Gal Wilder; Cohn & Wolfe; Toronto, Canada; 647-259-3261; [email protected]

Beth Daniher; Cohn & Wolfe; Toronto, Canada; 647-259-3279; [email protected]

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

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Customer Satisfaction with Retail Banks Increases from 2010, Despite Decline in Satisfaction with Fees

2011-04-21

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WESTLAKE VILLAGE, Calif.: 21 April 2011 — Consumer sentiment toward retail banks appears to have reversed its historical downward slide, increasing in 2011 for the first time since 2007, according to the JD Power and Associates 2011 U.S. Retail Banking Satisfaction Study^SM released today.

The study, now in its sixth year, finds that retail banking customer satisfaction has improved by four index points from 2010 to an average of 752 (on a 1,000 point scale) in 2011. Satisfaction with most factors of the retail banking experience—account information; facility; problem resolution; and product offerings—has improved from 2010, while satisfaction with account activities has remained stable. In particular, satisfaction with in-person branch interaction, product offerings and account information have all improved significantly. In addition, customer perceptions regarding their bank’s brand reputation and image have improved in 2011 for the first time since 2008.

Satisfaction with fees, however, has decreased considerably from 2010, even though the proportion of customers who report they were charged fees by their bank has declined from 53 percent in 2010 to 43 percent in 2011.  The primary driver of the decline in fee satisfaction has been changes in how fees are assessed, with 18 percent of customers in 2011 saying their fee structure had changed during the past 12 months, compared with 16 percent in 2010.  When fee structures are changed, overall satisfaction decreases by an average of 84 index points.

“While there has been a concerted effort made by the banking industry to get back to basics and provide customers with a satisfying retail bank experience overall, the well-publicized attempts by banks to recoup lost revenue due to Reg E debit card revisions by dropping free checking and repricing accounts has clearly had a negative effect,” said Michael Beird, director of banking services at JD Power and Associates. “The good news for consumers, and the challenge for the industry, is that banks are being forced to clearly define the value they’re providing for the prices they’re charging.”

According to Beird, charging fees and delivering high levels of satisfaction are not mutually exclusive.  Customers who pay fees and also express high levels of satisfaction are more likely to report having the following positive experiences: receiving a thorough needs assessment when opening an account that ensures they are using the right product; engaging in discussion of fees upfront; experiencing better personal interactions with branch and call center staff; having fewer problems; and receiving more effective resolution when problems do occur. An additional driver of improved satisfaction with fees is providing customers with a full menu of products that have tangible value, such as debit cards tied to rewards programs, free online banking and automatic overdraft protection.

“Being charged a fee does not necessarily have to result in dissatisfaction,” said Beird. “Customers who completely understand their bank’s fee structure and value the products and services they receive tend to have higher levels of overall satisfaction, despite paying fees.”

While smaller banks continue to outperform their larger counterparts, a number of large banks have performed well in 2011.¹ According to Beird, big banks have exhibited strong performance this year in the areas of service that customers value heavily. Enhancing in-person interaction with increased employee courtesy and knowledge, improving the overall experience of branches and reducing problems that customers experience are all areas in which large banks have traditionally lagged their smaller peers.

The study also finds that mobile applications represent one of the fastest-growing transaction channels available to banking customers, and while adoption remains sporadic, generational differences have clearly emerged:

• In 2011, 23 percent of Generation X and Y customers (those born after 1964) indicate they use mobile banking, up from just 11 percent in 2010.
• Just 9 percent of customers born before 1965 indicate that they use mobile banking applications.

“Generation X and Y customers embrace opportunities to perform banking activities at their convenience, unrestricted by traditional banking hours,” said Beird.

The study also finds the following trends relating to social media, which also has emerged as a new and powerful communication outlet when customers have a question, comment or complaint:

• Seventy-five percent of Generation X customers and 87 percent of Generation Y customers indicate they use social media applications. More than one-half customers born before 1965 also report using social media.
• One in eight customers who indicate they use social media say that they have used it to contact their bank for service-related issues. However, only 20 percent of these customers report receiving a response from their bank.

“Banks are just now beginning to understand the risks of ignoring this powerful communication channel,” said Beird. “Among customers who post customer service inquiries on sites such as Facebook or Twitter and receive a reply, 47 percent say they would definitely reuse the bank for future products and services. This drops to just 27 percent if the bank provides no response.”

According to Beird, there are a number of key practices and characteristics common to the highest-performing banks. Customers seeking a new banking relationship should look for the following when shopping for a new bank:

• Products and services that fit the customer’s personal lifestyle, including online and mobile tools
• Branch facilities that are clean, with good lighting and hours that fit the customer’s needs
• Branch staff that are courteous, knowledgeable and friendly
• Fees and service charges that are communicated clearly, consistently and in simple terms
• Recommendations from friends, family and neighbors who already use a particular bank

Study results by region are:

California: Rabobank ranks highest in the region with a score of 796, and performs particularly well in the fees and account activities factors. Bank of the West (777) and Union Bank/Frontier Bank (766) follow in the regional rankings.

Florida: Regions Bank ranks highest in Florida with a score of 789 and performs well in the fees, account activities and account information factors. SunTrust Bank (788) and Wachovia Bank (786) follow in the rankings.

Mid-Atlantic Region: With a score of 804, Northwest Savings Bank ranks highest in the region and performs well in product offerings. Susquehanna Bank follows with a score of 792, and S&T Bank ranks third with 791.

Midwest Region: First Midwest Bank ranks highest with a score of 775, and performs particularly well in the product offerings and account information factors. Commerce Bank and UMB Bank tie to follow in the rankings with a score of 774.

New England Region: Eastern Bank ranks highest in the region with a score of 791 and performs well in the product offerings and account activities factors. Rockland Trust Co. follows with a score of 789, and TD Bank and Wachovia Bank tie to rank third with 760.

North Central Region: FirstMerit Bank and Flagstar Bank tie to rank highest in the region with a score of 802. FirstMerit Bank performs well in facility, product offerings and fees, while Flagstar Bank performs well in account activities. Huntington National Bank and Independent Bank follow in the rankings with 799, in a tie.

Northwest Region: With a score of 794, Umpqua Bank ranks highest in the region and performs well in facility and product offerings. West Coast Bank (792) and Sterling Savings Bank (789) follow in the rankings.

South Central Region: Hancock Bank ranks highest in the region with a score of 817 and performs particularly well in the product offerings and account information factors. Whitney National Bank (799) and Arvest Bank (798) follow in the rankings.

Southeast Region: First Federal ranks highest with a score of 818, performing particularly well in the facility and product offerings factors. United Community Bank follows in the rankings with 813, and First Citizens Bancorp ranks third with 809.

Southwest Region: Arvest Bank ranks highest in the region with 809 and performs particularly well in facility, product offerings and fees. Zions First National Bank (782) and Bank of Oklahoma (779) follow in the rankings.

Texas: With a score of 849, Frost National Bank ranks highest in the region and performs well across all six factors, particularly account activities and fees. First Financial Bank (805) and Woodforest National Bank (792) follow in the rankings.

The 2011 U.S. Retail Banking Satisfaction Study is based on responses from nearly 52,000 retail banking customers regarding their experiences with their banking provider. The study was fielded in January and February 2011.

For more information, view retail banking satisfaction ratings at JDPower.com.

¹Large banks are defined as banks with more than 475 branches and $50 billion in deposits.

About JD Power and Associates
Headquartered in Westlake Village, Calif., JD Power and Associates is a global marketing information services company providing forecasting, performance improvement, social media and customer satisfaction insights and solutions. The company’s quality and satisfaction measurements are based on responses from millions of consumers annually. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. JD Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies
Founded in 1888, The McGraw-Hill Companies is a leading global financial information and education company that helps professionals and students succeed in the Knowledge Economy. Leading brands include Standard & Poor’s, McGraw-Hill Education, Platts energy information services and JD Power and Associates. The Corporation has approximately 21,000 employees with more than 280 offices in 40 countries. Sales in 2010 were $6.2 billion. Additional information is available at http://www.mcgraw-hill.com.

No advertising or other promotional use can be made of the information in this release without the express prior written consent of JD Power and Associates. /corporate

Prevalence of Non-Contract Monthly Service Plans Continues to Grow, as Product Offerings Become More Competitive with Those of Traditional Contract Service Plans

2011-03-31

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WESTLAKE VILLAGE, Calif.: 31 March 2011 — Nearly one-half of all non-contract wireless customers currently use monthly service plans rather than a pay-as-you-go plan option, according to the JD Power and Associates 2011 U.S. Wireless Non-Contract Customer Satisfaction Index Study^SM released today.

The study, now in its sixth year, measures customer satisfaction with current non-contract wireless service across six key factors (listed in order of importance): performance and reliability (31%); cost of service (21%); account management (17%); initial activation (12%); offerings and promotions (12%); and customer service (7%).

The study finds that product offerings in the non-contract segment have changed dramatically during the past several years, with many wireless carriers increasing the offerings of monthly plans—some mimicking traditional contract plans, while others have unlimited calling and texting. Currently, 49 percent of non-contract plan customers have monthly plans, compared with less than 30 percent in 2008—more than a 50 percent increase.

The increase in the prevalence of monthly plans can be partly attributed to a combination of cost savings and service offerings, and also to improved overall satisfaction due to positive recommendations from existing customers. In 2011, overall satisfaction among monthly service plan customers is comparable to satisfaction among those who use pay-as-you-go plans (762 on a 1,000-point scale vs. 768, on average). In 2009, the difference in overall satisfaction between monthly customers and pay-as-you-go customers averaged 14 points.

“Historically, the most common type of non-contract plan was characterized as pay-as-you-go, but several carriers have increased their offerings to include plans that mimic traditional contract plans without requiring customers to sign contracts,” said Kirk Parsons, senior director of wireless services at JD Power and Associates. “This particular service offering has become very popular, especially during the tough economic times. The appeal is based on lower cost of service, particularly when compared with contract-based offerings with similar service and product offerings.”

The study also finds that higher satisfaction levels may drive wireless customers to purchase additional products and services. In 2011, 53 percent of non-contract customers say they are likely to purchase additional products or services offered by their current carrier during the next six months, while 47 percent say they are content with their current plan and equipment. Overall satisfaction scores are 90 index points higher, on average, among customers willing to spend more money on additional purchases, compared with customers opting to continue with their current plan (807 vs. 717, respectively).

“As the non-contract wireless market continues to evolve, consumers need to explore all of the alternatives available to them in order to determine which plan suits their needs,” said Parsons. “With an increased breadth of options, wireless customers will likely find a plan that optimizes their wireless experience and meets their budget without requiring them to sign a long-term service contract. This may, in turn, benefit wireless providers with a robust segment of new customers with which to grow their business and increase service fee potential.”

For the first time since the inception of the study, Boost Mobile ranks highest in overall customer satisfaction among non-contract wireless customers and achieves a score of 808. Boost Mobile performs particularly well in four of the six factors that drive overall satisfaction: cost of service; account management; initial activation; and offerings and promotions. Also ranking above the industry average are MetroPCS, TracFone, NET10, Virgin Mobile and T-Mobile, respectively.

The study also finds the following key non-contract wireless usage patterns:

• Pay-as-you-go customers spend an average of $37 for each airtime purchase in 2011, an increase of $2 from 2010.
• Monthly non-contract customers spend an average of $32 less per month than do customers with contracts. Monthly non-contract customers spend $60 per month, compared with an average monthly service cost of $92 for customers with service contracts.
• Overall, non-contract customers use 326 minutes per month, on average. Pay-as-you-go customers use an average of just 180 minutes per month, while monthly non-contract customers use an average of 489 minutes per month—an increase of approximately 50 minutes from 2010.
• Among customers currently under contract with a postpaid carrier and who say they are likely to switch their carrier during the next year, nearly 40 percent (38%) are likely to choose non-contract service.

The 2011 U.S. Wireless Non-Contract Customer Satisfaction Index Study measures customer satisfaction with current non-contract wireless service. The study is based on responses from 6,436 wireless customers who currently subscribe to non-contract service plans. Findings are based on a continuous fielding period between July and December 2010. For more information, please visit JDPower.com.

For more information on customer satisfaction with wireless service, wireless retail sales, cell phone handsets, customer care, prepaid wireless service and business wireless service, please visit JDPower.com.

About JD Power and Associates
Headquartered in Westlake Village, Calif., JD Power and Associates is a global marketing information services company providing forecasting, performance improvement, social media and customer satisfaction insights and solutions. The company’s quality and satisfaction measurements are based on responses from millions of consumers annually. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. JD Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies
Founded in 1888, The McGraw-Hill Companies is a leading global financial information and education company that helps professionals and students succeed in the Knowledge Economy. Leading brands include Standard & Poor’s, McGraw-Hill Education, Platts energy information services and JD Power and Associates. The Corporation has approximately 21,000 employees with more than 280 offices in 40 countries. Sales in 2010 were $6.2 billion. Additional information is available at http://www.mcgraw-hill.com.

No advertising or other promotional use can be made of the information in this release without the express prior written consent of JD Power and Associates. /corporate

Members of Health Plans with Integrated Delivery Models Are More Satisfied than Members without Integrated Plans

2011-03-17

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WESTLAKE VILLAGE, Calif.: 17 March 2011 — Member satisfaction with health plans that share characteristics of integrated delivery systems (IDS) is considerably higher than member satisfaction with plans in which the provider and payer are not part of the same organization, according to the JD Power and Associates 2011 U.S. Member Health Insurance Plan Study^SM released today.

Now in its fifth year, the study measures member satisfaction among 137 health plans in 17 regions throughout the United States by examining seven key factors: coverage and benefits; provider choice; information and communication; claims processing; statements; customer service; and approval processes.

Satisfaction among members in integrated health plans, such as Health Alliance Plan and Kaiser Foundation Health Plan, averages 741 on a 1,000-point scale, compared with 691 among members of plans where care is not integrated. In addition, members of integrated plans have a better understanding of their coverage and the processes necessary to receive services. Among integrated plan members, 63 percent say they “completely understand” the benefits covered, compared with 52 percent among non-IDS plan members. Similarly, 44 percent of IDS plan members say they “completely understand” how to receive preventive services, while just 24 percent of non-IDS plan members say the same.

“While not every IDS is created alike, an advantage of these plans is that interactions center on the member as a patient, because the provider and plan are integrated,” said Richard Millard, senior director of the healthcare practice at JD Power and Associates. “The higher level of satisfaction with integrated plans is particularly important with the passage of the Affordable Care Act, which will result in the creation of accountable care organizations modeled after the IDS approach.”

According to Millard, members of integrated plans tend to be more satisfied with information and communication, as well as coverage and benefits, than do members of non-IDS plans, which highlights how improvement in these factors may go a long way toward improving overall health plan satisfaction.

In 2011, overall member satisfaction is at the lowest point since the study’s inception in 2007, averaging 696, compared with 701 in 2010. Member satisfaction with coverage and benefits has decreased slightly, with considerable declines occurring in satisfaction with information and communication; claims processing; and statements.

“Information and communication remains the factor with lowest satisfaction among all plans, possibly reflecting the increasing complexity of health benefits,” said Millard. “Because members are increasingly concerned about the uncertainties surrounding cost and coverage, plans that focus on delivering useful information to manage these changes tend to earn higher satisfaction scores.”

Overall satisfaction of health insurance plan members is among the lowest across the industries in which
JD Power and Associates conducts research, including mortgage, banking and investment services. Health plan members in Pennsylvania, New England and the Northwest region are the most satisfied with their health plan experience.

Health plans ranking highest in their respective regions are (in alphabetical order): Aetna (which ties to rank highest in Texas); Blue Cross and Blue Shield of Florida; BlueCross BlueShield of Alabama; BlueCross BlueShield of Illinois; BlueCross Blue Shield of Nebraska; BlueCross BlueShield of Texas (which ties to rank highest in Texas); Dean Health Plan; Group Health Cooperative; Harvard Pilgrim Health Care; Health Alliance Plan (HAP); Independent Health Association; Kaiser Foundation Health Plan (which ranks highest in California, Colorado, and the South Atlantic and the Virginia-Maryland-Washington, D.C. regions); Medical Mutual of Ohio; SelectHealth; and UPMC Health Plan.

The study also finds the following key trends:

• More than one-half (57%) of members say that they either chose to or were required to make changes involving cost or coverage during the past year—continuing a trend where more members say they are powerless in being able to control costs on their own.  
• In the growing market of individually purchased health insurance, satisfaction averages 667 points, compared with 700 among group health plan members. This gap indicates challenges ahead in improving the member experience for individual health plan members.
• Exchange-based purchasing, which may result in further growth of the individual market, is not yet well understood. However, only one-half of all members think that by 2014 they will continue to purchase health insurance as they do now.

The 2011 U.S. Member Health Insurance Plan Study is based on responses from more than 34,000 members of commercial health plans. The study was fielded in December 2010 and January 2011. For more comprehensive health plan rankings for all 17 U.S. regions, please visit .

About JD Power and Associates
Headquartered in Westlake Village, Calif., JD Power and Associates is a global marketing information services company providing forecasting, performance improvement, social media and customer satisfaction insights and solutions. The company’s quality and satisfaction measurements are based on responses from millions of consumers annually. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. JD Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies
Founded in 1888, The McGraw-Hill Companies is a leading global financial information and education company that helps professionals and students succeed in the Knowledge Economy. Leading brands include Standard & Poor’s, McGraw-Hill Education, Platts energy information services and JD Power and Associates. The Corporation has approximately 21,000 employees with more than 280 offices in 40 countries. Sales in 2010 were $6.2 billion. Additional information is available at http://www.mcgraw-hill.com.

An IDS is a network of health plans, hospitals and/or physician groups that work together to provide insurance, administrative and clinical healthcare functions.

No advertising or other promotional use can be made of the information in this release without the express prior written consent of JD Power and Associates. /corporate

2011-03-16

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• The average price of a traditional wireless mobile phone continues to decline and averages $73 in 2011, compared with an average of $81 at the beginning of 2009. The decline is primarily due to discounts provided by handset providers and wireless service carriers to incentivize sales. Currently, 46 percent of owners report having received a free mobile phone when subscribing to a wireless service, which is a historical high.
• Mobile applications continue to enhance the smartphone user experience. Two-thirds of owners say they have downloaded games and social networking applications to their device. More than one-half (54%) say they have downloaded travel software, such as maps and weather applications, while 53 percent indicate having downloaded entertainment-oriented applications. This indicates that smartphone owners are continuing to integrate their device usage into both their business and personal lives.
• Ownership tenure impacts overall satisfaction with the device experience. Those who report owning their device less than one year are significantly more likely to be more satisfied than those who have owned their wireless phone for a longer period of time (773 vs. 728). Newer devices tend to offer more features, services and better quality than older phones.

About JD Power and Associates

About The McGraw-Hill Companies

Overall Wireless Call Quality Momentum Halts Due to Shifts in Wireless Call and Data Usage Patterns

2011-03-03

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WESTLAKE VILLAGE, Calif.: 3 March 2011— Shifts in wireless phone usage, including smartphone and texting use, as well as an increase in the percentage of wireless calls being made and received inside buildings, has led to a halt in overall call quality improvement, according to the JD Power and Associates U.S. 2011 Wireless Call Quality Performance Study^SM—Volume 1 released today.

The semiannual study measures wireless call quality based on seven problem areas that impact overall carrier performance: dropped calls; static/interference; failed call connection on the first try; voice distortion; echoes; no immediate voicemail notification; and no immediate text message notification. Call quality issues are measured as problems per 100 (PP100) calls, where a lower score reflects fewer problems and higher call quality. Call quality performance is examined in six regions: Northeast; Mid-Atlantic; Southeast; North Central; Southwest; and West.

The study finds the percentage of wireless calls made indoors has increased considerably during the past eight years—​​​​​​​to an average of 56 percent in 2011 from 40 percent in 2003. During this time frame, the proportion of wireless calls made from homes increased most notably, averaging 35 percent in 2011, compared with 25 percent in 2003. Among wireless calls made outside of buildings, the greatest decrease has occurred among calls made in vehicles, which has declined to 20 percent in 2011 from 37 percent in 2003. Typically, wireless calls placed indoors result in slightly more problems, on average, than calls placed outdoors.

However, among wireless customers who use data-intensive devices such as smartphones or who have high texting activity, problem rates are higher than the industry average. Problem rates among users of smartphones average 13 PP100, while problem rates average 14 PP100 among heavy texters.  These shifts in usage patterns have slowed the historic improvement in call quality, which steadily improved between 2003 and 2009. However, during the past two years, there has not been a significant change in overall call quality performance across the industry.

“The performance gap has definitely lessened between indoor and outdoor calls, and the increase in frequency of calls placed indoors suggests that many customers today are quite confident in their carrier’s wireless network,” said Kirk Parsons, senior director of wireless services at JD Power and Associates.

According to Parsons, as this trend continues, it will be critical for wireless carriers to improve coverage for indoor locations. Additionally, increased adoption of smartphones and wireless tablets may continue to compromise the quality of network service, with connection issues holding particularly high potential for problems.

For a 13th consecutive reporting period, Verizon Wireless ranks highest in the Northeast region. Verizon Wireless achieves fewer customer-reported problems with dropped calls, initial connections and interference, compared with the regional averages. Verizon Wireless also ranks highest in the Southeast, Southwest and West regions, and ranks highest in the Mid-Atlantic region, in a tie with AT&T.

In the North Central region, U.S. Cellular ranks highest for a 11th consecutive reporting period. Compared with the regional average, U.S. Cellular has fewer customer-reported problems with dropped calls, failed initial connections, interference and delayed notification of text messages.

Additional study findings include: 

• Wireless usage patterns continue to evolve, as fewer calls are being made or received and customers are using their devices more often for text messaging, which increasingly is the preferred method for communication. The study finds that wireless customers receive 161 text message notifications per month, on average—​​​​​​​17 more than six months ago (144) and nearly 65 percent more than just two years ago (98).
   
• PP100 scores continue to be higher among smartphone customers than among traditional handset customers—​​​​​​​13PP100 vs. 11PP100. However, problem rates for traditional handsets have risen, compared with those reported six months ago (an increase of 9 PP100, on average).
   
• Among the top 27 U.S. markets, average PP100 scores are lowest among wireless customers in the Cincinnati and Pittsburgh metro areas (6 PP100), and highest among wireless customers in the Washington, D.C. metro area (18 PP100).

The 2011 Wireless Call Quality Performance Study—Volume 1 is based on responses from 26,019 wireless customers. The study was fielded between July and December 2010.

For more information on customer satisfaction with wireless service, wireless retail sales, cell phone handsets, customer care, prepaid wireless service and business wireless service, please visit JDPower.com.

¹ Verizon Wireless ranks highest in the Northeast, Southeast, Southwest and West regions, and also ranks highest in the Mid-Atlantic region, in a tie with AT&T.

About JD Power and Associates
Headquartered in Westlake Village, Calif., JD Power and Associates is a global marketing information services company providing forecasting, performance improvement, social media and customer satisfaction insights and solutions.  The company’s quality and satisfaction measurements are based on responses from millions of consumers annually. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. JD Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies
Founded in 1888, The McGraw-Hill Companies is a leading global financial information and education company that helps professionals and students succeed in the Knowledge Economy.  Leading brands include Standard & Poor’s, McGraw-Hill Education, Platts energy information services and JD Power and Associates.  The Corporation has approximately 21,000 employees with more than 280 offices in 40 countries.  Sales in 2010 were $6.2 billion.  Additional information is available at http://www.mcgraw-hill.com.

No advertising or other promotional use can be made of the information in this release without the express prior written consent of JD Power and Associates. /corporate​​​​​​​

Spending Sufficient Time Explaining Mobile Device Operation Is Critical to Higher Satisfaction with the Wireless Retail Sales Process

2011-02-17

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WESTLAKE VILLAGE, Calif: 17 February 2011 — Although overall satisfaction generally declines as the length of the wireless retail sales process increases, lengthy periods explaining the device’s operation do not negatively impact retail sales satisfaction, according to the JD Power and Associates 2011 U.S. Wireless Retail Sales Satisfaction Study^SM—Volume 1 released today.

Now in its eighth year, the semiannual study analyzes evaluations from customers who recently had an in-store wireless retail sales experience. Overall customer satisfaction with major wireless carrier-branded stores is based on four factors: staff (49%); price and promotion (27%); store facility (14%); and store display (10%).

The study finds that as the amount of time spent during the wireless retail sales transaction increases, customer satisfaction generally declines. Among customers who wait longer than two minutes to be greeted when entering the retail facility, overall satisfaction is 103 points lower than among those who are greeted within two minutes (762 vs. 659 on a 1,000-point scale).

This decline in satisfaction holds true for all stages of the sales process with one crucial exception: the time taken to explain the wireless device operation. In fact, satisfaction increases as the time spent explaining the device’s operation increases. Overall satisfaction among customers who receive an explanation in less than one minute is 740, compared with 758 among those who receive an explanation between five and 10 minutes in length. The average reported time to explain device operation is six minutes.

“Within the past year, there have been a number of new product and service plan innovations where, in most cases, customers needed to be re-educated in terms of device operation usage and how they can get the most from their phone,” said Kirk Parsons, senior director of wireless services at JD Power and Associates. “Instructing customers on operating particular devices affords salespersons an opportunity to display their own knowledge, as well as to showcase the handset lineup and latest offerings. As smartphone adoption rates continue to climb, this practice becomes even more important, as the average monthly spending is $6 more among customers who received a device operation explanation, compared with those who did not.”

Overall satisfaction with the retail sales process decreases dramatically when customers are not given adequate time to shop due to pressure from the salesperson to rush the sales process. Satisfaction among customers who indicate having experienced this kind of pressure during the sales process averages 124 points lower (630) than among customers who indicate not having experienced pressure (754).

T-Mobile ranks highest in customer satisfaction among major wireless carrier-owned retail stores for a fourth consecutive time with a score of 739, performing particularly well in price and promotions, such as competitiveness of service plans and devices offered. Sprint Nextel (730) follows T-Mobile in the rankings and also performs well in price and promotions.

The study also finds the following key retail wireless sales transaction patterns:

• Nearly three-fourths of customers indicate that a salesperson offered to explain the number of plan minutes during their most recent visit—a decrease of four percentage points from six months ago. Four in 10 customers indicate having been shown a coverage map or an explanation of the latest technology—an increase of four percentage points during the same time period.
• The average total time customers spent in the retail store to complete the sales transaction was approximately 57 minutes—an increase of one minute, compared with six months ago.
• Satisfaction with the retail experience among smartphone owners is 24 points higher than among owners of traditional handsets (742 vs. 718, respectively). Overall retail sales satisfaction among new smartphone owners of devices that run on the Android OS platform is higher, due mainly to aggressive price/promotion activities.
• More than one-half (56%) of wireless customers visit their retailer to upgrade or replace a phone from their current carrier. Renewing or changing an existing wireless plan (38%) and purchasing a new device (31%) round out the top reasons customers cite for having visited a retail store within the past six months.

The 2011 U.S. Wireless Retail Sales Satisfaction Study—Volume 1 is based on experiences reported by 8,501 wireless customers who completed a retail sales transaction within the past six months. The study was fielded between July and December 2010.

For more information or to view wireless retail ratings, please visit JDPower.com.

About JD Power and Associates
Headquartered in Westlake Village, Calif., JD Power and Associates is a global marketing information services company providing forecasting, performance improvement, social media and customer satisfaction insights and solutions. The company’s quality and satisfaction measurements are based on responses from millions of consumers annually. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. JD Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies
Founded in 1888, The McGraw-Hill Companies is a leading global financial information and education company that helps professionals and students succeed in the Knowledge Economy. Leading brands include Standard & Poor’s, McGraw-Hill Education, Platts energy information services and JD Power and Associates. The Corporation has approximately 21,000 employees with more than 280 offices in 40 countries. Sales in 2010 were $6.2 billion. Additional information is available at http://www.mcgraw-hill.com.

No advertising or other promotional use can be made of the information in this release without the express prior written consent of JD Power and Associates. /corporate