HE prefersthedull face of the familiar man behind the counter at a State Bank of India (SBI) branch to the suave, MBA-flaunting relationship manager at a snazzy HDFC Bank branch, Butshecan get very upset if she has to wait for more than three rings before she hears the polite, almost servile voice of an executive at her bank’ call centre. You could spot herat the check-in counter of Kingfisher Airlines in the crowded Mumbai Airport. These days, she isused toavalethelpingher with her baggage. In- side the aircraft, she likes to comfortably stretch her legs and enjoys her personal in-flight televi- sion screen. By now, you have probably guessed that she wont hide her displeasure ifthe cashier at her favourite lifestyle products store fumbles ‘with the billing process. And, of course, she hates tostand in a queue foranything When she disco- vers that a chic new trouser from her favourite ‘Allen Solly womens wear range its herso snugly, she is mighty pleased. Yet, when it comes to mo ney,she values safety over abit ofinconvenience, like a cumbersome medical test before she gets her insurance cover. That is why she pre- fers the Life Insurance Corporation (LIC) oflindia over private sector insurers Sheis the new, discerning, demand. ing Indian consumer. And, as marketers realising, she isa tough nut to crack. ‘That sketch is not the result of afew broad strokes based on general imp- ressions. Actually every small detail isbased on hard data gleaned from the CSMM-BW Customer Loyalty Survey 2006-07. Ietook New Dethi-based Cus tomer Satisfaction Management and Measurement (CSMIM), a spec- ialist unit of matket research firm IMRB International, 23,000 interviews in 10 cities to understand how custo mers feel about over 90 of India’s leading brands. The survey mea sured two key dimensions: custo- mer experience, which reflects how customers ratea brand pert ‘ormance; and customer loyalty, which captures how much custo- ‘mer goodwill a brand enjoys (see ‘methodology on page 6) ‘Thesurveycovered 16 productand service categories (see page 28). Admittedly, itis loosely modelled on the American Customer Satisfaction Index (ACSD, which tracks the pulse of the American consumer and measures cus- tomersatisfaction in 43 large industries in the US. THE CONSUM Indian consumers are happier — but marketers still have alot more to do.THE SET CUSTOMER ea ER ENIGMA Loyaity hits and misses rrr Pe eet (BR ANERICANS ARE MORE BRAND LOYAL SOME BRANDS CUSTOMERS LOVE. Allen Solly 67 Pizza Hut 62 Planet Sports. 61 - = =) 59 Indian Airines Globus Deccan Aviation Sutine Sees his erties aia Andat the end ofthe exercise, we found what you always suspected — marketers are strug sling to meet customer expectations on service. Forinstance, the average ACSI score of 74.9 is far higher than the Indian average of 51.22. (Both ‘methods measure customerloyalty on ascale of 1 to 100, though they are constructed diferent Strictly speaking, the woare not comparable.) ‘There are reasons for this disparity. The In- dian markets in a natural state of churn. As the ‘economy increasingly opens up, customers are getting newer, and better, choices. Obviously, ‘many will upgrade to the newer offerings. But marketers are struggling to keep pace with cus- tomer expectations. The USmarket,on theother ‘hand, smore mature and settled. tials larger. ‘Annual private consumption at Rs 2,39,64,072. crore ($5,446.38 billion) ismany imesmorethan India’ Rs 20,72,079 crore ($470.83 billion ‘Buteven withoutthe US comparison, itis ob- vious that the Indian consumer is demanding better service, Fifty four per cent ofthe 23,000 respondents do not feel anyloyalty the brands they own In some categories like lifestyle stores, this figure isashigh as64 per cent. Similarly, one out of every four customers National average 74.90 51.22 Appliances: 81.00 52.67 ‘Auto 81.00 52.80 Apparel 80.00 55.82 Insurance 79.00 50.13 Retail 79.00 50.40 Airines 65.00 44.00 te: ren igus resect tr on sonar Sev nse an Rees eee ‘ove SOMA Cra Seni dex ot sts fee ‘Cert cone stein ona sae of 100 feels trapped’ with the brand they own. Theres terrible warning in this, These customers are persisting with the brand notbecause theylikeit, ‘butbecause they do not have anexit, As choice and their own income levels rise, we could see ‘major shiftsin customer allegiances. ‘Number portability in wireless telecom is, one example. (The survey does not include the telecom sector) Today, even ifa customer is un- happy with a service provider, she is retuctant to switch, because her phone number will change. Butshe will haveno qualmsifher phone number remains the same, ‘Customers also seem to be sending out an- other message— they do not necessarily go with themarket leader, Companies such as Pantaloon (retail), Indian and jet Airways (airlines), Maruti (four-wheelers) ICICI Bank and HDFC Bank (home loans) have been given the thumbs-down by customers. These companies are not No. 1 in theloyalty rankings, However, a fewmarketlead- ers such as SBI (retall banking) and LIC (insur- ance) walked away with the honours ‘Whether you are a consumer ora marketer, there isa wealth of intelligence in the pages that follow. Ifyou are a consumer, you can use the survey to decide which brand to buy. And ifyou ‘are a marketer, you can judge how you fared against your rivals. And you may also gain fresh insightsintothemindoftheconsumer. swsnesswous 25 zara‘story LOYALTY MATRIX Less than half the customers are likely to continue with a brand. The Indian customer is not label-driven “Sportswear & accessories. Planes Sports soe a ni os Crecit cards a Sons EAT F {Ret} 3 C5 Le senvic Se ees ea eu Caté Coffee Day: Ce Kingfisher Air Decean Cea Lifestyle & fashion store Westside Globus F sailed “_Figutes.are the loyalty score ofthe brands Fs tee wusixessivontn 20 2apnn. v0ee VSS Pine SS CATEGORY * 2.Wheelers 4-Wheelers Airconditioners Aitines. Apparel Coffee outlets Credit cards Fast food. Housing loans. Insurance Lifestyle stores, Refrigerator Retail banking Sportswear Television Washing machine SECTORAL PROFILE ee 2 mE ¢ Ee 23 ES 17 BE 1 so) BEE 32 SS 7 = 32 Ce 2 mE 3 mw 5 es 3 EE 1 a eee 2 a 22 eHigt risk Trapped mAscessle. Tie lyals Accossibie customers ‘are not very key to se the same brand in the future, Trapped customers are not happy dealing with the brand, but are forced to-continue. High-risk customers do not ke desing wth the sonic provider and ave decided to swt to an- ther service provider. Compiled by Abhishek Chowdhury‘story - BIKERS ZOOM AHEAD The two-wheeler segment has attracted a good share of loyal customers N acountry where consumers buy. ‘about 1.3 million cars every year, Honda and Ford, two companies with a ‘combined market share of'ess than 10 per cent, have jointly topped the loyalty charts, There isa message in this for ] ‘Maruti, Hyundai and Tata, India’s three largest car manufacturers. Together, the {rio has over 80 percent market share. But they seem to have many unhappy ‘customers 10 — 50 per cent of respondents in the survey do not feel any sense of loyalty to these brands. However, two-wheeler manufacturers do not face any such problems. Hero Honda, Bajaj Auto and TVS Motor, the top: three manufacturers in that order, are ‘on top of the loyalty ranks, again in the same order. 2 THE RANKINGS — CSI, Rank 56 55 53 53 53 44 jo ole oP LOYALTY SEGMENTATION Hero Honda Sail 2 Yamaha CRG: 18) Sl Bajaj BE 268 vs ia 18: Enfield OE 21 un Soe 16 Industry Avg. 2a 20 lmiigh rik Trapped AccessiblePERFORMANCE MEASURES: TWO-WHEELERS Purchase experience 7. 69 74 6 69 69 75. Sales personnel 87 58 62 50 55 52 63 Vehicle usage & 68 69 72 55 Gd 63 66 Performance Servicing 62 e1 Gt 57 62 64 69 Consumer schemes & 80 54 50 4547 52 46% promotions Advertsing & comm 56 62 Gi 4358 soe ag Sone 0 wer hap in ho rane who mt cameos elo vey THE RANKINGS csi Rank | LOYALTY SEGMENTATION 55 4 Honda’ as 4 Ford 29) = 2 Maruti IS 51 4 yuna 49 5 Tata Motors GI {63k Customer satiation index Incusrty Ave. le High ish Trapped PERFORMANCE MEASURES: FOUR-WHEELERS Purchase experience 71 74 74 70 67 65 Sales personnel 60 60 59 61 67 87 Vehicle usage & 69 70 65 80 76 66 performance Servicing 59 62 86 64 47 55° Consumer schemes @ 48 50 8 59 a3 a promotions Advertising & comm. a7 50 46 49 43 anHEN itcomes to oyalty branded garments are a cutabove all other sectors. More than SI percent of respondents say they are Joyal to the apparel brands they ov ‘And even though consumers can easily switch brands, onty 24 per cent consumers say they are likely do so. But how has this sector managed to shine? ‘The answer — this category features eleven brands, more than any other category in this year’s survey. The lesson —the more the competition, the harder companies will work to delight their customers. Allen Soli, a premium brand positioned for the yuppie and upeomiing professionals, and marketed by Aditya Birla Nuvo’s Madura Garments tops that lst with 68 per cent ofits customers falling in the‘trueloyal category LOYALTY SEGMENTATION 0 ‘Allen Solty Provogue! Louis Philip I Levis li Colors ERR: Van Heusen I John Players Wills Lifestyle NBS arrow M2 Loo i vee: industry Ave 1 A High sk = Trapped MAccesSNNe True loys PERFORMANCE MEASURES Store experience a a1 m 2 6 76 Merchandise 63 cr o 6 @ Sales personnel 6s 69 Ce ee Bling 60 65 7 8858 Packaging ea 6 Cr. Additional sevioes 52 a sa Sie ag Schemes & promotions 54 @ se 4a OS Advertising & comm, 55 58 Cr ‘Speen: Renin of pee who wem Una these partes: “Cato wa el ermance s HUSINESSWORLDprtory PRET NS /HOIISING [NAN : THA y TRAPPED | FEELING === Customer HF E24 dissatisfaction is i ss ‘Sccs MEQSE 23 Baz visible across 22 HSBC MSN 21 these two Citibank 23: segments AN Ao 21) industry Avg, SHE 23 Highisk “Trapped Mm Accessible Tueloyls NEout of every three home loan Jcustomers and one out of every five credit card customers feels trapped. This simmering customer dissatisfaction is visible across all ‘companies in these two segments, There are no exceptions. Moreover, customer loyalty isamong the lowest here tin comparison-with other industries) This s a cause for concer for banks and financial service providers. As more sophisticated products make their way {nto the market, customers who now feel trapped may find easier exit routes. That ‘could lead to substantial churn in the assets on the books of these banks, Ult imately, thiscould erode profitability. ssustvesswvontb ArnicaApplication & approval process 60 65 72 63 59 58. Payment process 6s 57 e256 ‘Schemes & promotions 66 58 se 56 Advertising & communication 58°58 5560 Call centte of the bank 67 56 sy” ag* Supe Pscomage ol pi who we soma wa ie paromance a etcelen aver LOYALTY SEGMENTATION THE RANKINGS 0S, Ronk 1s 55 1 Hore EE 34° a fears cit bank os [503 tcica! 3 S49 4 icusty ig, Wg) ck Rained mAcesble mT lls PERFORMANCE MEASURES Application & approval process 0 60 6s 58 Verification process 87 56 60 54 Repayment process 87 58 55 53 Advertising & promotion 58 59 59 55 Comm. recelved on promotion 55 57 55 55 all centre of banly FI 67 50 70 62 ruin ed pramarce alent oF ey 08 1 0 tyro suswesswon BO 2aenit 20story KEEPING : THE RANKINGS score Rank RETAILERS Sssssc 5 oa BUSY == 6h Caren esto ne PERFORMANCE MEASURES: LIFESTYLE & FASHION STORES Indian consum- h ‘Store experience: 70 16 68 68 ers want MOTE. iicrrensse ee si 56 And retailers are sates personne! 60 @ 87 58 v Biling 58 64 51 57 gearing up to Pocleshig ess 888 1 Additional servic 55 54 ST 54 give then phate) 2 oer sea oes «58 Loyalty programmes 40” 337 29 3oF Advertsing &comm. 8 57 sO S India’s retail sector booms, ‘customer expectations are rising much faster than the pace at which retailers are able to roll out their services, “That isthe inescapable conclusion drawn from the performance of companiesin three segments — lifestyle and fashion stores, coffee chains and fastfood joints Forexample, though lifestyle and fashion stores like Shoppers’ Stop, Parttaloon, Lifestyle, and Globusare offering shopping experience that is decidedly better than what was available five years ago, customers are demanding more. The segment has managed to mustera loyalty / of only 36 per cent. A similar story plays out inthe coffee chains category. Thirty-two per cent of customers feel they are trapped. Now, that's not a comforting thought fora coffee bar In fast foods, Pizza Hut comes out far ahead of competitor Domino’ because ‘customers think that the Pizza Hut’ staf is ore service oriented ! susivessnony OA araLOYALTY SEGMENTATION: LIFESTYLE & FASHION STORES Westside M200 23 SS ‘Shoppers’ Stop MEBI —30 NNEC SN) Pantaloons Ii Lifestyle M22 Globus RGGI Industry Avg, M6! High risk Trapped Accessible Tre lyals 70 6 70 52 66 55 63 aT 56 SL 62 50" 53 En 4" 63 is 45 49" A LOYALTY SEGMENTATION: RETAIL CHAINS-COFFEE OUTLETS THE RANKINGS .cS'. Rank cafe coffee day RERUNS) SC 57 4 Barista QE 32 yam eel Industry Avg. SESE 32 LS 49 High sk Trapped Accessible Tue lots (3: Gbtamer ston in PERFORMANCE MEASURES: RETAIL CHAINS-COFFEE OUTLETS Outlet experience 61 59 cy Ordering & services 58 54 on Food & beverages 64 63 66 Staff at the outlet 62 61 63 Value added services 4s 43" 54 Advertising & communication 40" 38 a Sine: Pateotage of tpe win wee Unnapny In these para “Cus Who ted arene a alent oF"e) BodiM fF LOYALTY SEGMENTATION: RETAIL CHAINS-FAST FOOD JOINTS Pizza Hut E28 McDonald's RS 25 Domino's M2 6 Industry Av, 2 High ak © Trapped Accessible mL TTue loys PERFORMANCE MEASURES: RETAIL CHAINS-FAST FOOD JOINTS Fast food outlet experience 68 5307774 Ordering & self services BB 58 Ordering & the services 6B. 5477 at the outlet Tele-ordering& senices 6 7 2 6 Food & beverages 69 50 7672 Staff at the outiet 61 55 66 GL Schemes & promotions 56 sis 62 56" ‘Advertising & comm. 56 457 60 63 intsipt rere of pale vio wre ynhapy nese paaetes “Ctanes no Fold oernatoe ss eect vn eo ese tt iy pee susnesswontn SO 2armu20nstory T’S amazing how much difference an ‘exaggerated emphasis on customer comfort can make in crowded competitive and eommoditised market. The airlines sector iswithessing fierce competition —fares ae falling and new online tools and fare structutes are enabling customers fo shop for value, But Kingfisher Airlines, with its mix of comfortable and spacious seats, special services lke in-flight television entertainment for every seat, etc has ‘managed to wow the consumer. Itenjoys the loyalty of 56 per cent ofits customers, while the industry averages 43 percent. Dont miss the storyon Kingfisher on page 56 Indian Air Deccan! Kingfisher 22 Jet. Airways Air Sahara Industry Aver. MISS? High disk csi Rank score 551 2 Lee 4 LOYALTY SEGMENTATION 15 a a7 pocessiie Tre lvals PERFORMANCE MEASURES Ticketing & puchascewp. 52 51-59 Pre-boarding experience 44 = 46.87 Boarding expenence a7 43 59 In-ight experience 50 55 62 Call centre/ Helpline 42" 30° 48% Loyalty progamme nm 6 Advertsing & comm, 43" ait 50 ‘Schemes offered ar 43 as? Tie-ups offered aa" a8 aa 51 48. ag" 36" 50% 4a" 49 4x” 39 a7" 48° 3T* 4g 37 58 42" 53 a4 43 44 — 36" ax" at” Si eStart ey enonTHE RANKINGS oo ! 59 1. | 552 mana 523 149° Ae p48 CS 48 5 45 z york Wd = Estar stsacon inex LOYALTY SEGMENTATION uc 22 a (CIC! Prudential MBE "33 Pia Ee HOFC Standord ine REGIS i Aviva Life ME 32 Bajaj Allianz 22 40 TATA AlG BZD 31! ING Vysya MRMIESS! 7 Max New York MORE 34. Industry Ave. 1 32 High isk STroped | macessble = The ejls HE Life Insurance Corporation of India (LIC) enjoys the confidence of PERFORMANCE MEASURES ‘nso out of every three of ts custo- ‘mers. That is remarkable for two reasons. First, very few market leaders have topped “ BI thecustomerloyalty chartsso comprehen Appl. approval process. G4 65 67 = 61ST GO sively: LIC’ base ofloyal customers (66 Per —edical exam process 47" 33" ag" 52 ea 57” cent) isacutabove the nsuranceindust- fysloyalty average of4@ percent Secona, surance polices O60 GASB GOS very few government-owned undertakings Advertising promotion SO 53 S87 49 88 58 hhavemanaged to buildso strongabond- Comm. on new [Aart eee eS ae with customers, Butcustomershad one policies & scheme sore point — they were unhappy with LIC cumbersome medical examination Postpurchase ep. S652 6B SBS OO process, Only 33 percent ofrespondents _Ins. agen/ advisor 57 64 59 60 co” ‘were happy with LIC's medicals, while Callcentre/heipine 64 6760 -69°~«78~«62 competitors like TATAAIGhad ascore of | esr: para of spe no ne uta exe earners: Cur es edt | 61 in their medical process. we BASU SER Seat sae seca emmcat aan taee Le pustwesswontn AQ 2 apa. 2007(ODERN branches of many foreign banks maylead us to believe that customer service is about gleaming branches and suave relationship managers. That the State Bank of India (SBD, which boasts of neither, has beaten its savvy foreign bank rivals does comeas a surprise. Look closer, and there are many more unexpected findings about the bank. On the ‘highly service-oriented staff’ parameter, customers rate SBI (score ‘of 80) higher than Standard Chartered Bank (78) or HDFC (73). Similarly, on the ‘customer care/call centre’ parameter ‘SBI’ score of 89 is way ahead of ts nearest rival Standard Chartered (63). Thats why the market leader is also the No. Lin customer loyalty. THE RANKINGS Sa. tank Ste ti 53 2 52 3 52 3 | 52. 5. 50 6 49 z 49. i. 45 Qo. 48 9 Si Customer ston as LOYALTY SEGMENTATION 6 ScGR 22 27 CS HDEc R2OE 31 ey 1C1C) RH S20 sc 208/32) PNB REQESE 29) A Ctibank 22 29 Canara Bank 20R 36 TA ABN Amro SIRE 2 Ea Bank of Baroda 2 33 tao Industry Avg M2200 31 A igs risk @Treppes mAccessible Tre loyais PERFORMANCE MEASURES Account opening process 67 «6569.74 7067 Branch vstemerence 63 GDB 70 ~68 GI” ATM centres 2m 73 72 75 70 69 Customer cara/ cal centre 68 54" 60 63" 50 Prone berkng SBS e750 BY 50" Net banking: 58 62 88 63" 52 70 ‘Additonal facities 4 Ob7 84 4B O82 Advertisements & comm. 51 5964 SAAB SL ‘oymonce as noel of Wy 600d a ‘Seice: CSU ojly epot suswesswom AZ 2 arit2o07Tis notoften that big global brandslike Nike, Reebok and Adidas get beaten to the topslotbyalocal brand. Butthatis, ‘exactly what sportswear retailer Planet Sportshas managed todo. There is ani teresting story nitsrise tothe top ofthe ‘customer satisfaction index (CSD. Plane Sportshasalow loyalty rating—only 47 per centofits customersare loyal the industry averages 49 per cent). But it scores on store cexperienceand merchandise lis‘experi ence’ score of 74 much higher than the 39-94 score recorded by others) propelled it tothe op. . Planet Sports IG Industry Avg, M2 High fs THE TOPPERS 35, "=" g61 58 a 54 53 (Sh Gaemeessston nde LOYALTY SEGMENTATION Nike 2 Adidas NDS Reebok IZ Aecesaile Tie kyals Trapped PERFORMANCE MEASURES Store experience 73 8 73 70 67 Merchandise 62 67 62 62 60 Sales personnel 62 7 638 57 87 Bling 60 77 59 55 Be Packaging 6s 74 67 «Gl GL Additonal serices 58 68 sa 58 58 ‘Schemes & promotions 57 go ss" Si 52 Advertising & comm. 62 68 64 Gl 56 ‘Sed peteinance et aehen of en gout” A Oe cain any rapa_story WHITE GOODS) — THE RANKINGS CSI, Rank (52 ESOS Sa EES = EE 508 ME so BE so HORSE ===" PERFORMANCE MEASURES I q \( ‘ J Purchase exp. at the store 60 54 Billing process 58 49 Datvery process _ 53 56 Product usage & performance 64 678 Korean products, See egepnan sae ar are hot in the ‘Advertising & comm, 53 59 8388 white goods market : TELEVISIONS OREAN companies LG and Samsung dominate the entire white goods segment. They lead in ‘market share and the survey results show thar they have the vote of consumers too. LG has topped the refrigerators and air conditioners space, while Samsung is No. I intelevisions. There seems to bea bit ofa challenge from Japanese companies — Sony and Hitachi have muscled their way into the second spot in televisions and air- conditioners, respectively (see ‘The Second ‘Battle’ on page 68). And Videocon, which topped the charts in washing machines, is ‘the lone Indian companyatthe top. i susnessvone 4B pr 200Mg eT CUSTOMER OS ea ih LOYALTY SEGMENTATION a High isk Trapped MlAccessibie BLTrue ysis Supa: Pcertage ot ape wo ite unhapy in he ‘puerta “Cistomers wf ats paromance se clon of Sn be LOYALTY SEGMENTATION THE RANKINGS cor Rank samsung 20% 19 SP 57 1 a Sc 2 ES 5 OO 1 MEMES oS GEST 466th Trapped Accessible | Tiue loyats (5: Gate stron in PERFORMANCE MEASURES Purchase exp. at the store 65 70 6 66 61 58 Delivery process 58 58 62 60 55 56 Product usage & perf. 69 73 70 7568 68 Aftersales service e863 2 Cons, schemes & promos 50 53 S451 54 Advertising & comm. 57 6 e259 51 50 54 Supersci Pecetaga fgg wh wat hapa ates paraitrs: “uMtmare uo rated pefomance as ‘exalt o Vy Sots Cun BW iy ese oe rusimtssvont AY) saonanorory WHITE GOODS) — colton Tai eT THE RANKINGS ,°S', Rank a 59 a 582 5S 3 53 4 5 ES sa (3: Cioner sinter nan LOYALTY SEGMENTATION Hitech SS PERFORMANCE MEASURES — ei Song ED pychosecp attests 67776971 Voltas ROSE 9 LEI ing process 57 64 BT 53s Corer LETT sory orocess a ge eee Videcon AEST raves usage & pertormonce 68 72 ~=70 ~~70 ~~ 70 ~—~70 Sivestar RS LOWRNNNETII es serie a ag ee eae Nees —— Consumer schemes & promos 52 58 BF 50 ‘54 51 Industry Ave. Advertsing com “of 88 55 85 65 (Vigh ok M Trapped mAccessible MTrualoyals —utemar io vied ponomonce a stele” over a TES THE RANKINGS oS}, Rank ViDEOCON a ss MESS 55 ME 4 a 52 4 MT 49S Ct Cisne enc ne PERFORMANCE MEASURES Purchase exp.at the store 677i BS 6B. Videocon M2! 2 SI Biling process 58 55 68 Gi 87 57 Somsung E26 A Pema nes, eS Se os een 0 | pee are pee 08+ Sis = Code A: 19: settle sells Sd = SE = Whithoo 28° a Sa Consumer schemes & promotion 80 S182 49 51 a Advertising & comm, 8556 S45 3 el ‘Sunersenp: Percentage of pecgle who were unhappy In these parameters; *Custaemers who rated performance 35 tusty Avg. RAS: 22 > KA wee eran ose aie en ‘SoueerCskia Sw myo toer MAGN Wk Trapped | mAccessive m True lyals swosvesswoni 50) sso zw»