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Managing Customer Expectations for Value, Speed and Reliability Are Key to Satisfaction and Brand Differentiation for Broadband Internet Service Providers

LONDON, March 30, 2011—As broadband Internet service becomes increasingly commoditized, service providers that successfully manage customer expectations around network performance and value can benefit from increased customer satisfaction and brand differentiation, according to the J.D. Power and Associates 2011 UK Fixed Broadband ISP Customer Satisfaction Study(SM) and the J.D. Power and Associates 2011 UK Mobile Broadband ISP Customer Satisfaction Study(SM), both released today.

 

The studies examine five factors that drive overall satisfaction with broadband Internet service providers: performance and reliability; billing(1);  cost of the service; customer service/technical support; and offerings and promotions.

“Customer expectations are continually rising when it comes to broadband service—users want it to be faster, less expensive and constantly available without interruption,” said Stuart Crawford-Browne,  director of service industries research at J.D. Power and Associates.  “However, properly setting and managing customer expectations through transparent and clear communications and customer service can go a long way in helping ISPs differentiate themselves from the competition.”

Among fixed broadband service customers, approximately 24 percent indicate that the network speed they experience is slower than they expected. Overall satisfaction among these customers averages 512 on a 1,000-point scale,  compared with an average of 652 among customers who indicate the network speed meets their expectations. Among mobile broadband customers, 25 percent indicate they have experienced slower-than-expected network speed, and satisfaction among these customers averages 503. In contrast,  among mobile broadband customers who indicate that the network speed meets their expectations, satisfaction averages 638.

“It is particularly critical for ISPs to deliver on promised network speeds,  particularly when these expectations are being set by marketing and advertising messaging,” said Crawford-Browne. “Rather than advertising maximum network speeds, providers can benefit from communicating the range of speeds that customers can realistically expect to experience.  Even though connection speeds may be affected by location and customer computer and software configurations, any perceived lag may be attributed to the service provider, thus lowering satisfaction levels.”

The study finds that offering loyalty incentives to broadband service customers can be particularly effective in improving satisfaction by elevating customer perceptions of value for the price paid. Among fixed broadband customers, there is a 76-point gap in satisfaction between those who indicate they received some kind of loyalty incentive (678, on average),  compared with customers who did not (602, on average). Among mobile broadband customers, the gap averages 74 points (668 vs. 594,  respectively).

There is ample opportunity for broadband ISPs to utilise loyalty incentives to help improve satisfaction. Only 33 percent of mobile broadband customers and 38 percent of fixed broadband customers report receiving some type of loyalty incentive.

Fixed Broadband Internet Service Provider Rankings

Plusnet ranks highest among fixed broadband Internet service providers with a score of 717 and performs particularly well in the performance and reliability and cost of service factors. O2 (710) and Sky (663) follow Plusnet in the rankings. O2 performs particularly well in the offerings and promotions and billing and customer service factors.

Mobile Broadband Internet Service Provider Rankings

Among mobile broadband Internet service providers, O2 ranks highest for a third consecutive year and achieves a score of 648. O2 performs particularly well in the performance and reliability factor. Following O2 in the rankings are Orange (629) and 3 (622).

While 39 percent of mobile broadband customers and 28 percent of fixed broadband customers say they “probably would” or “definitely would” switch Internet service providers within the next 12 months, undertaking efforts to retain these customers can help providers experience a long-term lift in satisfaction. The longer a broadband customer stays with their provider, the higher their satisfaction, on average. Among fixed broadband customers who have been with their provider for up to one year, satisfaction averages 615, compared with an average of 641 among customers who have been with their provider for more than two years. Among mobile broadband customers, the difference in satisfaction averages 19 points (616 vs. 635, respectively.)

The 2011 UK Fixed Broadband ISP Customer Satisfaction Study, now in its sixth year,  is based on responses from 2,041 residential customers with fixed line broadband services across the UK. The 2011 UK Mobile Broadband ISP Customer Satisfaction Study, now in its third year, is based on responses from 1,244 mobile broadband customers. Both studies were fielded between February and March 2011.

(1) In the UK Mobile Broadband ISP Customer Satisfaction Study, this factor is referred to as billing/topping up, to include pre-pay customers who are replenishing credits for mobile broadband usage.

2011 UK Fixed Broadband ISP Customer Satisfaction Study


Customer Service Index Ranking


J.D. Power.com Power Circle Ratings


(Based on a 1,000-point scale)


For Consumers


Plusnet

717

5


O2

710

5






Sky

663

4






Orange

634

3


Virgin Media

631

3


Industry Average

631

3


TalkTalk

626

3


BT

616

3






AOL

570

2







Customer Satisfaction Component Weights – Fixed Broadband ISP Segment


Reliability

35%


Cost of Service

20%


Offerings and Promotions

18%


Billing

17%


Customer Service/Technical Support

10%






2011 UK Mobile Broadband ISP Customer Satisfaction Study


Customer Service Index Ranking


J.D. Power.com Power Circle Ratings


(Based on a 1,000-point scale)


For Consumers


O2

648

5






Orange

629

4






3

622

3


Industry Average

619

3






T-Mobile

608

2






Vodafone

593

2







Customer Satisfaction Component Weights – Mobile Broadband ISP Segment


Performance and Reliability

34%


Cost of Service

24%


Billing/Topping up

18%


Offerings and Promotions

14%


Customer Service/Technical Support

9%






Power Circle Ratings Legend:


5 – Among the best


4 – Better than most


3 – About average


2 – The rest





About J.D. Power and Associates

The European headquarters of J.D. Power and Associates is located in Munich, Germany.  With world headquarters in Westlake Village, California,  U.S.A., J.D. Power and Associates is a global marketing information services company providing forecasting, performance improvement, social media and customer satisfaction insights and solutions.  The company’s quality and satisfaction measurements are based on responses from millions of consumers annually.  J.D. Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies

Founded in 1888, The McGraw-Hill Companies is a leading global financial information and education company that helps professionals and students succeed in the Knowledge Economy.  Leading brands include Standard &  Poor’s, McGraw-Hill Education, Platts energy information services and J.D. Power and Associates.  The Corporation has approximately 21,000 employees with more than 280 offices in 40 countries.  Sales in 2010 were $6.2 billion.  Additional information is available at http://www.mcgraw-hill.com.

Media Relations Contacts:

Stuart Crawford-Browne, Guildford, Surrey; United Kingdom; +44-1483-207610; stuart.crawford-browne@jdpa.com

John Tews; J.D. Power and Associates; Troy, Michigan USA; +1-248-312-4119; media.relations@jdpa.com

No advertising or other promotional use can be made of the information in this release without the express prior written consent of J.D. Power and Associates. www.jdpower.com

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