Netflix, Gap lag in customer satisfaction online

Wed Dec 28, 2011 5:27pm EST

A screen grab shows the access to Netflix online, as displayed on a television screen, in Encinitas, California July 25, 2011.  REUTERS/Mike Blake

A screen grab shows the access to Netflix online, as displayed on a television screen, in Encinitas, California July 25, 2011.

Credit: Reuters/Mike Blake

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(Reuters) - Netflix Inc and Gap Inc were among the worst performers in customer satisfaction among the largest online retailers this holiday season, according to a survey released on Wednesday.

Overstock.com Inc came last out of the 40 largest online retailers, with a rating of 72 out of 100, down 4 points from last year, the survey by ForSee found.

Gap.com, Gap's main website, was second last with 73 points, down 5 from a year ago. Other laggards included buy.com and websites run by Sony and Toys R Us, ForSee said.

Customer satisfaction is important for retailers because it can lead to higher sales, more loyalty and increased word-of-mouth recommendations, ForSee said.

Netflix saw the biggest decline in customer satisfaction in ForSee's most-recent survey after the company tried to raise prices and split its DVD and video-streaming services. The plan was scrapped after customers defected.

"Netflix totally misread its customer base and is paying the price, damaging its brand among both consumers and investors," said Larry Freed, chief executive officer of ForSee.

Netflix shares lost more than half their value this year, with most of the damage coming after the company unveiled its intention to split its services.

Netflix had come close to customer-satisfaction leader Amazon.com in previous ForSee surveys. But in the latest poll, Netflix dropped 7 points to 79, the largest decline of any retailer in the survey.

Amazon climbed 2 points to 88 to lead ForSee's survey for the 14th consecutive time. ForSee runs the poll about every six months.

The biggest gainer was TigerDirect.com, a tech gadget and parts website owned by Systemax Inc, which climbed 6 points to 79.

Another big gainer was JCP.com, J.C. Penney's website, which rose 5 points to 83. That put the retailer in a tie for third place with QVC.com, Apple's online store and VistaPrint.com.

(Reporting by Alistair Barr; Editing by Tim Dobbyn)

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Comments (5)
Spocksy wrote:
For all the negative reactions, netflix was ultimately trying to be smart. DVDs are things of the past. They suffered from customers who are kind of living in the past.

Dec 28, 2011 1:00pm EST  --  Report as abuse
JL4 wrote:
Netflix still has the best product on the market. I’m a loyal customer, and I believe they will recover. When they announced the DVD/Streaming division and their customers went nuts, they backed down, and I give them credit for that. The price increase wasn’t handled well, but then how do you handle that well in today’s economy? It’s still a lot cheaper than cable or satellite.

The GAP? You couldn’t pay me to shop in one of their stores – they sell overpriced, low quality clothing. Me? No thanks. Take that crap to China and let them wear it. I’m just sorry the GAP is closing about 700 stores and putting thousands of Americans out of work so that they can profit in “Emerging Markets.”

Dec 28, 2011 7:45pm EST  --  Report as abuse
delovett3 wrote:
$8 a month for netflix is less than 2 drinks at starbucks, 4 Coca-colas, or even a large sized meal at most fast food restaurants. People will always complain no matter how cheap things are.

Dec 28, 2011 7:50pm EST  --  Report as abuse
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