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Keeping Customers Happy Is Getting Harder for Retailers

This was the second year in a row that customer satisfaction with the retail experience dropped.

It’s getting more difficult for the nation’s retailers — from department stores to supermarkets — to keep their customers happy, according to the new American Customer Satisfaction Index (ACSI) report released on Tuesday.

The retail sector scored a 74.8 on a 100-point scale, a slide of 2.6 percent from 2014. This was the second year in a row that customer satisfaction with the retail experience dropped. Of the six categories covered by this survey, only gas stations rated higher — and that was due to lower fuel prices, the report said.

These results are based on interviews with 9,358 randomly chosen customers, and conducted via email between November and December 2015.

Why the decline? ACSI data shows that customer satisfaction peaked in the years following the Great Recession — a time when retailers and employees were trying hard to please customers with big discounts and better service.

“We’ve had a bit of a honeymoon period over the last few years and that’s now over as higher prices are returning,” said David VanAmburg, ACSI’s managing director. “Customers have higher expectations now. They have a little more money in their pocket to spend and they’re going to be more discerning about the quality of that shopping experience.”

No improvement for department and discount stores

With a score of 74, down 3.9 percent, the country’s big-name retailers are now back down to satisfaction levels seen before the economic recovery. Not a single store in this category did better in the past year.

Customers are generally pleased with the sales and promotions, and the variety and selection of merchandise. They’re not happy with the time it takes to checkout. Store layout and cleanliness also show room for improvement.

The top and bottom companies in this category remain the same this year: Nordstrom (82) and Dillard’s (80) had the highest scores; Sears (71) and Walmart (66) were in the basement.

Other familiar names: Fred Meyer (79), Kohl’s (77), Target (75), J.C. Penney and Ross (74). Macy’s dropped eight percent to score a 73.

Macy’s was hurt by its decision to close stores and reduce staff, VanAmburg told NBC News.

“One of the worst things a company can do in terms of long-term customer satisfaction is to reduce its workforce because now there’s not as much staff to help you. And that becomes critical in any kind of shopping experience,” he said.

Costco dropped four percent from the last survey, but with an ACSI score of 81, remains on top in this category. BJ’s Wholesale Club and Sam’s Club are now tied at 76. Other notable results: Lowe’s (74) drops nine percent to stay slightly ahead of Home Depot (73). Best Buy scores a 74.

Supermarkets take a super drop

Higher food prices appear to be taking their toll. Customer satisfaction with supermarkets dropped nearly four percent to register a 73, the lowest score in more than a decade.

Wegmans (86) was the only supermarket and one of only three retailers to improve its score. The 88-store East Coast supermarket chain not only takes the top spot again this year, it’s also the highest scoring retailer in the ACSI survey.

Trader Joe’s (83), H-E-B (82), Publix (82), ALDI (81) and Hy-Vee (78) round out the top supermarket chains.

Whole Foods dropped 10 percent to score a 73.The report noted that Whole Foods “cannot shake its reputation for high prices,” at a time when competitors are offering more organic products at lower prices.

Target (73) also took a big plunge, dropping 12 percent. At the bottom of the list: Albertsons (which recently bought Safeway) down eight percent to 68. Giant Eagle (67) and Walmart (67) tied for last place.

"We survey millions of customers throughout the year and receive great feedback on our efforts to deliver clean stores, fast checkouts and a friendly store environment," Walmart spokesperson Danit Marquardt said in a statement. "We continue to raise the bar in these areas so we can make the shopping experience even better for our customers."

Drug stores take a nose dive

Satisfaction with drug stores hit a record low of 73, down five percent from 2014. Walgreen’s, America’s largest drug store chain, dropped four percent to score a 74. CVS (71) dropped five percent and Rite Aid (69) plummeted 12 percent. Walmart’s drug stores (68) are at the bottom.

Today’s shoppers seem to like the convenience of the full-scale pharmacies now available at many supermarkets and discount stores, Van Amburg noted. The in-store pharmacies at Kroger (81) and Target (80) lead the category.

Internet shopping also less satisfying

While Internet retailers scored higher than brick-and-mortar stores, even they saw a decline in customer satisfaction, with an ACSI score of 80, down 2.4 percent. The report notes that “every single online company shows deteriorating customer satisfaction” from 2014. Amazon, which slipped three percent to 83, continues to dominate the e-commerce market.

The biggest declines in satisfaction were for Netflix, which raised its subscription price for new customers in October. Its ACSI score drops six percent to 76. Both eBay (75) and Overstock (73) saw their scores drop five percent.

The takeaway message

So many retailers these days sell the same variety of merchandise. They can market their low prices or offer good service. And as VanAmburg noted, there’s only so much you can do with price.

“Differentiating on customer service and on the quality of the shopping experience is really what it’s all about,” he said “Do you have the inventory in the store? Is the store well laid out? Are the customer service personnel helpful and there, can you find them? That’s what it’s all about.”

Herb Weisbaum is The ConsumerMan. Follow him on Facebook and Twitter or visit The ConsumerMan website.