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2008

Google, Apple Score High In e-Business

August 20, 2008 0

{mosimage}Customer satisfaction governing online information-retrieval services is on the rise, and according to a recent study conducted by the University of Michigan’s American Customer Satisfaction Index (ASCI) second quarter report, reaches a record high while revealing a shift in the way people are seeking out content with e-business websites is at an all-time high.

Apple tallied a score of 85 in the PC segment, compared with 75 and 73 for Dell and HP, respectively. The emerging overall winner: Google has extended its lead in the Internet search engine/portals category of the (ASCI) index, leaving all search engine competitors, including Yahoo and Microsoft, in the dust.

After experiencing a slip in satisfaction last year, the ACSI report released early Tuesday claims the search giant has emerged as the clear dominate player in 2008 in the big search and portals category.

Google’s ACSI score of 86 out of 100 (based on interviews with 3,000 customers) is one of the highest scores ever recorded by the ACSI, up 10 percent from last year, places it among the top businesses that the researchers have measured in all industries.

“This surge is mainly due to Google’s focus on making a successful transformation from a search engine to a full-service portal.”

For the e-business sector as a whole (including search and portals and a second category for news and information sites), the survey paints an improving picture: customer satisfaction improved 5.5 percent from 2007 to 79.3 this year on the ACSI’s 100-point scale. That is a 25.9 percent jump since e-businesses were added to the survey in 2000.

“Satisfaction,” of course, is a tricky thing to measure or even define, said Larry Freed, the author of the report and CEO of the consulting company ForeSee Results. The ACSI is based on a methodology researchers would not disclose and is used to measure customer satisfaction in 40 different industries, both online and offline. Researchers believe that what they arrive at is a fair assessment of consumer expectations and perceptions for a company matched against that company’s ability to deliver.

So far this year, the only ones to top it are the carmakers Lexus and BMW, which each scored an 87. Matching Google’s score were Toyota and Honda.

“People have started to go directly to the Web site or use bookmarks if they know what they are looking for, rather than using a portal,” Freed said in a statement. “And if they do not know where to find it, they are going to use a search engine. Google is best positioned to take advantage of this trend, while the rest are struggling to maintain relevancy.”

Yahoo was listed at 77 and MSN at 75 as their recent acquisition battle appeared to have distracted their managements.

“Based on not only satisfaction, but also the volume numbers and the growth, it looks as if Google is continuing to stretch that lead,” Freed said. “Satisfied consumers are going to come back, be loyal and use these services more, which in turn is going to generate more revenue for these companies,” said Freed.

Google’s coming back to the top slot this year that Yahoo held in 2007 is all thanks to a significant redesign, besides, in the search category, Google has also been capturing market share, for instance, garnering 61.5% share of market in June, according to ComScore — Whereas, Yahoo had 20.9% and MSN 9.2%.

The company has added features such as e-mail, chat, maps and news while also maintaining its highly functional search engine brand.

Freed believes Google’s strong showing may be a sign that the search king’s innovations, whether it is as simple as improved weather results on searches or “universal” search, are starting to have an impact on mainstream customers. “It is a changing marketplace and consumers are using the internet differently than they used to,” said Freed.

The survey also touted Apple Inc.’s claim to the top score in the ACSI’s personal computer category for five straight years; beating rival computer makers selling Windows-equipped PCs by historic margins in an annual customer satisfaction survey, the poll’s chief researcher said.

“The last time it was beaten was 2003, when it was edged by Dell by a single point.”

“We have not seen anything like this before, where a company scores 10 points over its nearest rival,” said Claes Fornell, the head of the American Customer Satisfaction Index (ACSI), conducted quarterly by the University of Michigan.

Apple’s customer satisfaction score of 85, an ACSI record in the personal computer category, was 10 points higher than the closest competitor, Dell Inc.; 12 points higher than Hewlett-Packard Co.; and 13 higher than Gateway, which was acquired by Acer last year.

“It is almost an aligning of the stars,” said Fornell, also a professor with the university’s business school, talking about Apple’s large lead and its six-point climb from 2007’s score. Last year, Apple’s customer satisfaction slipped four points compared to 2006.”

Rounding out the top five search engines, Ask.com posted an ACSI score of 74, and earned high marks from the researchers for its privacy efforts and continued commitment to improving the search experience.

AOL posted a 3 percent increase with a score of 69, but the researchers were not high on its prospects given that its business is more purely aligned with the portal model than any of the others.

Among news sites, MSNBC.com took the top spot with an ACSI score of 76, followed by ABCNews.com (75), NYTimes.com (75), CNN.com (73) and USAToday.com (73).

“The increase in overall e-business satisfaction is driven largely by a remarkable jump by Google, but tough economic conditions may be contributing to greater satisfaction with the sector,” said Fornell in a statement. “In an environment where dollars are tight and gas is $4 a gallon, consumers derive great satisfaction from services that do not require them to spend money or get in their car.”

While the overall survey shows an increase in satisfaction with eBusiness, it is also a reaffirming of the power of Google. The search giant has successfully doubled up its strengths into other focuses in the market, proving that it can dominate in areas where it decides to lay tracks: those that are often too big to be filled by the closest competitor.

The University of Michigan customer satisfaction project typically interviews more than 200 companies every year across 10 economic segments and 43 industries. Each quarter it releases results in different categories, such as the PC and search categories in the current quarter’s results.