Survey: Google and Yahoo Lead in Customer Satisfaction

WASHINGTON -- Internet giants Google and Yahoo are well-known rivals, but in the area of customer satisfaction, Google has a slight edge among Americans, according to a study on e-business released this week.

The e-business category includes Web portals, search engines, and other news and information Internet sites. Based on a 100-point scale in the University of Michigan's American Customer Satisfaction Index, overall customer satisfaction with e-business rose to 75.9 this year, a 4.7 percent increase in the last year and 20.5 percent increase since 2000.

The index measures customer satisfaction of more than 200 companies across 41 different industries, and for the first time in the history of the study, e-business surpassed the national ACSI average of 73.1.

PC Companies' Scores

In the same survey, U.S. consumers lambasted Dell for poor customer service, sending the world's largest PC vendor into a virtual tie with the rest of the PC market behind industry-leader Apple Computer.

For the second year in a row, Apple received the best rating from PC buyers in the American Customer Satisfaction Index, said David Van Amburg, general manager of the ACSI. The University of Michigan compiles the ACSI in numerous product categories by randomly calling U.S. residents and surveying their buying habits, he said.

Apple received a score of 81, compared to an industry-average score of 74. The Cupertino, California, company's focus on product innovation and customer service has won it a cadre of famously loyal customers unlike any other PC vendor, Van Amburg said. Apple also received a score of 81 in 2004.

Dell, on the other hand, earned a score of 74, down from a score of 79 the previous year. Survey respondents complained mostly about the quality of Dell's customer service, not its products, Van Amburg said. The ACSI doesn't ask specific questions about the type of problems customers are having with a company, but customers were clearly more frustrated with the Round Rock, Texas, company than last year, he said.

A few recurring complaints were the length of time on hold with Dell customer-service representatives, as well as the quality of the help customers eventually received, Van Amburg said. Dell has started to expand its lead over Hewlett-Packard in PC shipments, and sometimes when market leaders increase their product shipments they fail to increase service capabilities at the same rate, Van Amburg said.

HP and Compaq

The ASCI tracks HP's customer satisfaction in two categories, partly because HP's U.S. consumer PC business is divided between two different product lines and partly to provide historical comparisons for the performance of the products before HP acquired Compaq in 2002. HP-branded products received a score of 73, while Compaq-branded products were rated the lowest of any vendor, with a score of 67.

The HP-branded products have now regained the customer satisfaction score they posted before the merger, while the Compaq products have continued to languish well below the rest of the industry, Van Amburg said. HP is looking into its two-brand strategy as it searches for opportunities to cut costs under Chief Executive Officer Mark Hurd, and some analysts believe it might be time to cut the Compaq PCs from its lineup.

Gateway posted the largest increase in customer satisfaction last year after its acquisition of eMachines, but slipped a bit from 74 to 72 this year. However, that difference is within the survey's margin of error of three points, Van Amburg said.

Overall customer satisfaction with the PC industry remains well below the scores received by other consumer-product industries such as household appliances and automobiles. Despite all the work the PC industry has done to try to make their products easier to use, customers are still frustrated by PC technology, Van Amburg said.

The index measures the buyer's satisfaction with the last PC they purchased, which allows the ACSI to obtain the freshest experience, Van Amburg said. It surveyed 250 customers per company.

(PC World also does an annual Reliability and Service survey. For our most recent results, go here.)

Competition: Good for Consumers

In an era of convergence, the once-separate groups of search engines and Web portals are now considered direct competitors for the same audience. And with an unchanged score of 82 for the past three years, Google is the top scorer. But Yahoo this year narrowed the gap, increasing its score from 78 to 80 in 2005.

"(Google has) the most satisfied and loyal customers of any e-business company measured by the ACSI, and it has translated into the biggest market share in the sector and huge revenue growth," said Larry Freed, online satisfaction expert and president and CEO of ForeSee Results, a sponsor of the study.A "But Yahoo is going to battle, and Web users are the biggest winners in the competition between the two."

But don't rule out others like America Online, MSN and Ask Jeeves entirely. For instance, this year, America Online increased its customer satisfaction rating from 67 to 71, a 6 percent increase and 26.8 percent increase since 2000. Freed said that for AOL, it is all about utilizing the exclusive content of parent company Time Warner.

"Overall the competition is very fierce," Freed says. "Portals and search engines are doing a good job of meeting consumer needs by innovating and providing new services, like Yahoo Music and Google Earth, for example."

Tom Krazit of IDG News Service contributed to this story.

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