acsi american customer satisfaction index · acsi travel report 2018 acsi 9 | [email protected]...

ACSI

ABOUT ACSIThe American Customer

Satisfaction Index (ACSI®) is a

national economic indicator of

customer evaluations of the quality

of products and services available

to household consumers in the

United States.

The ACSI uses data from

interviews with roughly 180,000

customers annually as inputs

to an econometric model for

analyzing customer satisfaction

with more than 300 companies

in 44 industries and 10 economic

sectors, including various services

of federal and local government

agencies.

ACSI results are released

throughout the year, with all

measures reported on a scale of

0 to 100. ACSI data have proven

to be strongly related to several

essential indicators of micro and

macroeconomic performance. For

example, firms with higher levels of

customer satisfaction tend to have

higher earnings and stock returns

relative to competitors. Stock

portfolios based on companies

that show strong performance in

ACSI deliver excess returns in up

markets as well as down markets.

At the macro level, customer

satisfaction has been shown to

be predictive of both consumer

spending and GDP growth.

American CustomerSatisfaction Index®

©2018 ACSI LLC. ALL RIGHTS RESERVED.

INDUSTRY RESULTS FOR:Airlines

Hotels

Internet Travel Services

April 24, 2018

ACSI TRAVEL REPORT 2018

Internet Travel Services78 -1.3%

Hotels76 0.0%

Airlines73 -2.7%

http://www.theacsi.org






AIRLINES

Passenger satisfaction with airlines is down 2.7% to 73 on a scale of 0 to 100, all but reversing last year’s gain on the American Customer Satisfaction Index (ACSI®). Lower fuel prices during the 2014-2016 oil crash kept airfares down, which led to somewhat higher passenger satisfaction over the past three years. However, rising costs and new labor agreements have made it more difficult to keep ticket prices as low, which may be contributing to this year’s ACSI decline.

While some of the largest legacy airlines compete with discount carriers on price, the reality is that competition in the airline industry is quite limited. After a spate of recent mergers, almost 80% of the market is now under the control of no more than four operators—and they seem more inclined to collaborate than to compete, thereby reducing the threat of customer defection. For passengers, this means higher prices and less service.

All but four of the largest airlines register weaker passenger satisfaction this year. Southwest is among those to buck the trend, remaining steady at an ACSI score of 80 for the third straight year. Keeping fares low and service levels high while growing its network has helped Southwest reclaim the lead from JetBlue, which falls back 4% to second place at 79.

With Little Competition, Airlines Squander Passenger Satisfaction

ACSI Travel Report 2018

ACSI

1 WWW.THEACSI.ORG | [email protected] ©2018 ACSI LLC. ALL RIGHTS RESERVED.





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ACSI


A small boost for Alaska places the airline among the few gainers, and it now shares second place at 79. Alaska recently merged with Virgin America and lowered ticket prices considerably. Mergers typically have a dampening effect on satisfaction, but the opposite happened here. In addition to a vastly expanded network and lower fares, Virgin has an unusual legacy (for an airline) of good customer service, which benefits Alaska’s passengers.

Allegiant also makes strides, up 4% to an ACSI score of 74. The ultra-low-cost carrier was one of the last airlines to offer rewards, but its relatively new loyalty program has improved tremendously—ACSI data show an 8% gain from a year ago. Despite the satisfaction gain and a strong record of profitability, Allegiant may be heading straight into turbulence following recent high-profile news reporting on mechanical issues and safety concerns that sent its stock tumbling.

American and Delta each drop 3% to meet Allegiant at 74, just above the industry average. All other, smaller airlines slip 1% to a combined score of 73. Beleaguered by customer service issues, United plummets 4% to 67. United employees are not the worst-rated in the industry, but they do show the sharpest decline for courtesy and helpfulness.

At the bottom of the category, Frontier slips 2% to match Spirit at 62. The 2% bump for Spirit is not enough to move it out of last place, but it does return the airline to its all-time high.

Airline bag check-in fees are now more frequent than ever, but passengers appear to have become accustomed to the additional charges. Not having to pay out of one’s own pocket apparently helps—business passengers who checked luggage at a fee are some of the most highly satisfied travelers.






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With the exception of check-in, which remains at 82, every aspect of flying has deteriorated in 2018 compared with the prior year. This includes making reservations (81), flight crew courtesy (80), baggage handling (79), and several other aspects of the flight experience.

According to passengers, leg room is not improving. Seat comfort was already the low point of travel, but it has worsened more than any other element this year (down 3% to 69).

On the other hand, business travelers are also more likely to complain. More than a third of the surveyed business travelers report filing a complaint with an airline as compared with 11% of leisure passengers.

Nevertheless, business travelers who complain are much more satisfied than the average personal traveler with a complaint (ACSI score of 78 vs. 72). On the positive side, airlines have improved the way that they handle these complaints, particularly for leisure passengers, boosting their ACSI score up 11% from a year ago.






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HOTELS

Guest satisfaction with hotels is stable at an ACSI score of 76, although individual brand results vary as a new generation of travelers begins to shift the hospitality landscape. Millennials may not yet have the buying power of baby boomers, but they are behind the drive toward more unique properties, using social media to broadcast their experience. Hotel guests are now a powerful source of word-of-mouth marketing, and sharing feedback about negative service experiences can be potent anti-advertising.






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With increased competition from alternatives like Airbnb and boutique hotel brands, larger hotel chains are under pressure to provide a more customized experience and even better customer service. Hilton and Marriott are among the chains that are doing this well. Both improve overall this year, and Marriott’s lifestyle brand, AC Hotels, dominates the hotel brand rankings.

Hilton steps up 1% to hold first place with an ACSI score of 82. Hilton guests appreciate a highly personalized experience, which the hotelier has advanced through mobile technology. Hilton’s wide variety of brands appeals to many different types of travelers—and its mobile app works seamlessly across all of them.

Marriott takes second place with a 1% gain to an ACSI score of 81, although its upscale AC Hotels leads the brand rankings. Marriott’s results bode well for the company in the first full year after acquiring Starwood, which is unchanged in third place at 79.

Hyatt slips 1% to tie with Starwood at 79, followed by Best Western (+1%) and InterContinental (-1%) at 77. La Quinta edges up 1% to match the industry average at 76.

Smaller hotels also improve 1% to a combined score of 75 in a second straight year of gains. Choice and Wyndham, however, move in the opposite direction, each slipping 1% to 73 and 70, respectively. G6 Hospitality’s Motel 6 remains at the bottom of the category, unmoved at 65.






ACSI


Similar to the case with airlines, hotel business guests are far more likely to complain than leisure guests (25% vs. 10%). Among those who have complained, business guests are more satisfied than leisure guests (ACSI score of 80 vs. 76).

Hotels, however, are doing a much better job resolving the complaints of the everyday guest, which is increasingly important. With social media, guests communicate glitches instantly—not just to the hotel itself, but to an online audience. Many hotels have adapted accordingly, using social media as a tool to quickly resolve issues. It seems to be working. Among leisure guests who have complained, customer satisfaction is 23% higher than it was a year ago.

Among hotel brands, AC Hotels by Marriott rises to the top with an ACSI score of 84. Hilton takes the next spot with Garden Inn at 83, followed by its Embassy Suites, Hampton, and Hilton Hotels & Resorts at 82. Luxury brand JW Marriott (82) joins these properties as well.

According to guests, upscale brands aren’t always better than others in the same hotel portfolio. Marriott’s upper midscale Fairfield Inn & Suites (81) does far better than its Residence Inn (75), which is branded as upscale. InterContinental’s midscale Candlewood Suites (79) outranks its Holiday Inn Express (77) and Holiday Inn (76), both of which are classified as upper midscale.

Wyndham’s midscale Baymont Inn & Suites (78) beats its upscale Wyndham Hotels and Resorts (76), and Hilton’s upper midscale Hampton (82) comes in far ahead of its upscale DoubleTree (77).

The best economy brand is Econo Lodge (73) by Choice, which outshines its midscale sister Quality (66) and far surpasses other measured economy hotels.






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Even though customer satisfaction with hotels is unchanged at the industry level, competition has prompted hotels to improve many aspects of the guest experience.

Guests report that checking into hotel rooms is remarkably easy and continues to get better (86). The only area to slip is the ease of making a reservation, which is down slightly compared with last year (-1% to 85). Website satisfaction is one of the few benchmarks to register no improvement (83), along with amenities and food services (both flat at 74).






ACSI


Hotel guests say that most other aspects are better. Staff members are more courteous and helpful in person (84) and on the phone (83). Rooms are cleaner and more comfortable (82) and in-room entertainment is better (76). In-room wireless speed and reliability has improved the most (+3% to 77).

Hotel loyalty programs are slightly improved (74), but still rank among the lowest-rated aspects of the customer experience, alongside amenities and food.

INTERNET TRAVEL SERVICES

Customer satisfaction with travel websites for booking flights, hotels, and car rentals is down 1.3% to an ACSI score of 78.

Expedia Group and its brands remain dominate, despite a downturn for its namesake website. Expedia’s Orbitz leaps ahead 4% to top the category at 81, while Travelocity, another Expedia subsidiary, gains 4% to 80. The 2017 breach of Orbitz’s legacy platform was not revealed until after data collection and is not reflected in the results.

The Expedia website itself shows signs of strain, dropping 3% to 78, no better than smaller travel website sites, which also fall 3% to an aggregate score of 78. Competitor Priceline also scores 78, but rebounds 1% after a sharp decline a year ago.

Users of online travel services still rate the booking and payment process highly (84), but nearly every other customer experience element has deteriorated. Loyalty programs are the only aspect to improve, but they remain on the low end at 75.






ACSI


Ease of navigation has slipped (81), while site performance and travel options are not as well regarded (both down 2% to 80). In addition, descriptions (79), images (78), and reviews (76) aren’t as useful compared with a year ago (down 2% to 3% each).

Customer support is less helpful (-3% to 76), and promotions and package deals aren’t as good (76). Site-generated recommendations for other travel services are the least satisfying aspect of online booking, dropping for a second year in a row to a poor score of 72 (-4%).






ACSI


ABOUT THIS REPORT

The ACSI Travel Report 2018 on airlines, hotels, and internet travel services is based on interviews with 12,172 customers, chosen at random and contacted via email between April 18, 2017, and March 18, 2018. Customers are asked to evaluate their recent experiences with the largest companies in these industries in terms of market share, plus an aggregate category consisting of “all other”—and thus smaller—companies.

The survey data are used as inputs to ACSI’s cause-and-effect econometric model, which estimates customer satisfaction as the result of the survey-measured inputs of customer expectations, perceptions of quality, and perceptions of value. The ACSI model, in turn, links customer satisfaction with the survey-measured outcomes of customer complaints and customer loyalty. ACSI clients receive confidential industry-competitive and best-in-class data on all modeled variables and customer experience benchmarks.

ACSI and its logo are Registered Marks of the University of Michigan, licensed worldwide exclusively to American Customer Satisfaction Index LLC with the right to sublicense.

No advertising or other promotional use can be made of the data and information in this report without the express prior written consent of ACSI LLC.





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