Insurance Company USAA Tops BusinessWeek's List of 'Customer Service Champs'

NEW YORK, Feb. 21 /PRNewswire/ -- For the second consecutive year, insurance company USAA tops BusinessWeek's ranking of "Customer Service Champs." The BusinessWeek list ranks the best providers of customer service, and digs into the techniques, strategies, and tools they use to deliver great service.

Good customer service would seem to be a simple matter. Make policies flexible. Customers don't like playing call-center tag; keep it to a minimum. Hire friendly people, train them well, and reward them with healthy pay and benefits. But delivering the right level of customer service turns out to be hard. Some companies struggle to find smiling teenagers who are willing to work for the minimum wage flipping burgers. Others have the difficult task of ensuring their customers get the same message whether they're online, on the phone, or in the store. Slip up, and your service snafu becomes a tale consumers tell with relish over and over again.

BusinessWeek's special report on customer service digs deep into how companies are coping with this challenge. It highlights those that won a place among the 2008 Customer Service Champs, a ranking of the best-in-class companies using data from consumer researcher J.D. Power & Associates.

The results of BusinessWeek's 2008 Customer Service Champs ranking make clear something most consumers already suspect: Customer service is on the decline. Consumers who responded to this year's J.D. Power & Associates surveys, spoke up about their frustration. The average score on the list dipped slightly, with a majority of companies scoring lower than last year. And the scores of a few longtime service stars, including Four Seasons Hotels and Saturn cars, tumbled more.

Sentiments about customer service may have dipped, but the top 25 companies still garnered plenty of praise. While there were many repeat winners, 10 new names made the list this year, including well-known service companies like L.L. Bean-who doesn't love a company that answers every call within 20 seconds?-and Amazon.com. Cult favorites Trader Joe's and Chick-fil-A made it into the BusinessWeek rankings, too, thanks to a strong response from readers. A few names, such as Wachovia and Fairmont Hotels & Resorts, simply beat out prior winners in their industries by netting higher J.D. Power scores. And of course there's JetBlue Airways, which earned its way back on to the list after getting booted last year when massive February storms sent its operations into a tailspin.

To come up with the winners, BusinessWeek started with existing data from J.D. Power, a consumer researcher that, like BusinessWeek, is owned by The McGraw-Hill Companies. BusinessWeek combined the scores from a series of studies in J.D. Power's 2007 database for each brand. Like last year, J.D. Power's database was supplemented by surveying 5,000 readers using the BusinessWeek Market Advisory Board, asking them to nominate three companies they felt were the best and three they felt were the worst at customer service. More than 1,000 readers responded, with 2,596 "votes" and 1,885 "complaints." J.D. Power then ranked all of the brands, using scores from both their database and the supplemental surveys. BusinessWeek combined the "people" and "process" scores from J.D. Power's data to create the Service Index, with people weighted at 60% and process at 40%. Then, because widely divergent industries were being comparing -- a romantic weekend at the Ritz-Carlton is a much different experience than an afternoon waiting for the cable guy to arrive -- BusinessWeek gave credit for scoring high within an industry.

BusinessWeek made three changes to the methodology this year. Because many consumers rave about the service they get from smaller companies, the revenue bar was lowered for the companies on the list to $1 billion from the $1.5 billion mark set last year. Last year BusinessWeek subtracted an additional 50 points from the bottom player in each industry; that penalty was not applied this year. Finally, to recognize companies that did particularly well in the reader poll, BusinessWeek awarded an extra 25 points to those whose vote-to-complaint ratios were in the top 10%.

BusinessWeek's special report, "Customer Service Champs," is featured in the March 3, 2008 issue, on newsstands February 25th. Additional content, including an expanded top 50, company profiles, and a chance for readers to vote for their top 10, is available online at www.businessweek.com/magazine.

                          BusinessWeek's Ranking of
                          "Customer Service Champs"

                           Rank     Brand/Industry

                            1       USAA
                                    Insurance

                            2       L.L. Bean
                                    Online/Catalog Retail

                            3       Fairmont Hotels
                                    Hotels

                            4       Lexus
                                    Auto

                            5       Trader Joe's
                                    Supermarkets

                            6       Starbucks
                                    Restaurants

                            7       JetBlue Airways
                                    Airlines

                            8       Edward Jones
                                    Brokerage

                            9       Lands' End
                                    Online/Catalog Retail

                            10      Ace Hardware
                                    Home Improvement/Big Box Retail

                            11      Lincoln
                                    Auto

                            12      The Ritz-Carlton
                                    Hotels

                            13      Amica
                                    Insurance

                            14      Enterprise Rent-a-Car
                                    Rental Cars

                            15      Publix Super Markets
                                    Supermarkets

                            16      Nordstrom
                                    Department Stores

                            17      Southwest Airlines
                                    Airlines

                            18      Wachovia
                                    Banking

                            19      Smith Barney
                                    Brokerage

                            20      Cadillac
                                    Auto

                            21      Apple
                                    Computers

                            22      Chick-fil-A
                                    Restaurants

                            23      Amazon.com
                                    Online/Catalog Retail

                            24      JW Marriott Hotels
                                    Hotels

                            25      True Value
                                    Home Improvement/Big Box Retail