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UK Customer Satisfaction IndexThe state of customer satisfaction in the UK
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January 2015

UKCSI January 2015 | The state of customer satisfaction in the UK
1The Institute of Customer Service
foreword
The January 2015 UKCSI reveals a fourth consecutive fall in customer satisfaction. UK customers are now, on average, less satisfied with the service they receive than at any point since July 2010.
I believe that these results reflect profound shifts in the market environment. Customers expectations have evolved rapidly, leading to an ever-growing desire for convenience, speed and value. Moreover, we expect the service experience to be more personalised than before, with organisations expected to anticipate our current and potentially future needs.
As customer expectations have evolved, some organisations have evolved with them or even ahead of them. This report shows that a number from a range of sectors deliver consistently high UKCSI scores, indicating a sustained focus on meeting and where possible exceeding what customers expect.
But no fewer than 58% of the organisations in UKCSI have seen their customer satisfaction score fall by more than one point over the past year. Meanwhile the average satisfaction rating in all but two of the 13 sectors in UKCSI has dropped over the same period.
The business risks of service under-performance are acute. As UKCSI reveals, customer behaviour is strongly influenced by service quality. Organisations that deliver better service benefit from more recommendations, driving customer
acquisition and sales. They also create more customer loyalty and trust. For the retail food sector, the research demonstrates a striking and consistent link between service levels and growth in market share.
In the relationship economy, customer relationships are a critical factor in business success, as are relationships with suppliers, partners and employees. In this new environment, those organisations that put service at the heart of their business models and collaborate to deliver the end-to-end experience will be the most successful.
Given the clear links between customer service and business outcomes, the findings in this report should serve as a call to action for organisations across all sectors. The results have national implications as well. The ability of UK companies to compete successfully in international markets depends on the service skills, leadership and innovation they demonstrate, as does the ability of UK plc to attract inward-investment as a great place to do business.
I believe that organisations have much to gain by driving a genuine and sustained focus on the service agenda and the results of the UKCSI serve to prove this point.
Joanna CausonCEO

2 The Institute of Customer Service
contentsUKCSI January 2015: key findings 3
Customer satisfaction in the UK: the state of the nation 4
Customer service in 13 sectors 5
The new environment for customer service 10
Why customer service matters 13
Customer satisfaction and employee engagement 17
Trends in customer satisfaction measures 19
The customer service performance of organisations 21
What should organisations do? 26

The downward trend in customer satisfaction continuesCustomer satisfaction, as measured by the UKCSI at the national level, is now lower than at any point since July 2010. This suggests that organisations in the UK are not keeping up with customers increasing expectations of service and that many are missing out on the business performance benefits of high and/or improving customer satisfaction.
Only two sectors have improved customer satisfactionOf the 13 sectors covered in UKCSI, Utilities have delivered the most improved average customer satisfaction ratings over the past year, with a rise of 1.9 (out of 100) since January 2014. Banks & Building Societies is the only other sector to have registered an improvement over the period, albeit by just 0.3 points. Meanwhile, three water companies Southern Water, Yorkshire Water and United Utilities have registered the largest improvements in customer satisfaction by any organisation during this period.
Customer segments offer contrasting levels of satisfactionThe most significant contrast between customer segments revealed by UKCSI is around age groups. Younger people are considerably less satisfied as customers, underlining the importance of understanding the needs and satisfaction levels of different customer groups.
Service drives sales and market share in the Retail Food sectorFor the sixth consecutive period, leading food retailers with a UKCSI score above the Retail Food sector average have grown their combined market share, while the below average competitors in the sector have lost market share.
Service drives customer engagement, trust and loyaltyThe UKCSI results provide evidence of the link between customer satisfaction and business outcomes. Highly satisfied customers are significantly more likely than less satisfied customers to make a recommendation, remain as customers and feel a sense of trust towards the organisation.
Satisfaction ratings related to speed, complaints and staff issues have fallenIn the past two years, customers have reduced their ratings on 26 of the 28 customer experience metrics included in UKCSI. Some of the most significant declines can be seen in metrics relating to three key areas: speed/responsiveness, complaints handling and staff behaviour/attitude.
Consistent high scorers dominate the UKCSI top 10A group of seven organisations has consistently scored over 83 (out of 100) in UKCSI over the past two years. One of these organisations, John Lewis, is the highest rated named organisation in UKCSI January 2015.
Employee engagement is strongly linked with customer satisfactionThose sectors where customers rate employees to be more engaged tend to deliver higher levels of customer satisfaction, indicating the critical role of employee engagement in improving and sustaining service.
key findingsUKCSI January 2015

customer satisfactionin the UK:the state of the nationBased on the experiences of 10,000 customers across 13 sectors of the economy, the UKCSI reveals the trend in customer satisfaction at the national level. The January 2015 findings indicate that customer satisfaction continues to be under pressure, with a drop in the index of 0.3 points compared to July 2014, and a drop of 1.1 points since January 2014. This decline continues a downward trend recorded since customer satisfaction peaked at 78.2 in January 2013. At 76.0, the index is now lower than at any point since July 2010.
We believe this downward trend in customer satisfaction is due to a combination of factors associated with market environment changes, shifts in customer expectations, preferences and behaviour and in some cases, a number of organisations that have not focused sufficiently on their customer service strategies and delivery.
What is the trend in customer satisfaction?
Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15
UK
Cus
tom
er S
atis
fact
ion
Inde
x (U
KCS
I)
70
71
72
73
74
75
76
77
78
79
77.1
77.978.2
78.0
77.477.3
76.7
75.675.2
74.1
72.0
76.376.0

customer satisfactionin 13 sectors
UKCSI scores by sector
50 60 70 80 90 100
Retail (Non-food)81.482.283.1
Retail (Food)79.680.981.0
Tourism79.479.880.0
Automotive78.679.780.5
Banks & Building Societies78.477.778.1
Leisure78.379.680.9
Insurance77.177.678.9
Services77.078.880.2
Transport72.372.172.5
Public Services (Local)72.171.972.8
Telecommunications & Media71.672.273.3
Public Services (National)71.370.971.9
Utilities70.969.469.0
Jan-15
Jul-14
Jan-14

Sectors in category UKCSI performance Characteristics
Retail (Non-food and Food)TourismAutomotiveLeisureInsuranceServices
UKCSI down but remains
above all-sector average
Characterised by a high level of competition and customer demand for speed and convenience
Most but not all organisations set strategic priorities based on the role of service in driving business
performance
Some organisations have focused on gaining market share in the short term but not addressed sustainable improvements that drive customer satisfaction and loyalty
Banks & Building Societies
UKCSI up slightly and
above all-sector average
Sector has maintained satisfaction levels year-on-year Regulatory and media focus on business practices and
treatment of customers has highlighted links between
service, reputation and business performance
Improved ability of customers to switch banks likely to incentivise further investment in improving service
First Direct and Nationwide both feature in the

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