NEW YORK ( TheStreet) -- As Nordstrom ( JWN), Netflix ( NFLX) and Amazon ( AMZN) strengthen their business through enhanced customer service, some of their competitors are leaving cash on the table.
According to the American Express ( AXP) Global Customer Service Barometer released today, 61% of 1,000 American consumers surveyed think good customer service is more important amid economic instability and are willing to spend an average of 9% more at a retailer that provides it. There was more potent proof of this finding in 2006, when a Journal of Marketing study found that the performance of top 20% of companies in the University of Michigan's American Customer Satisfaction Index (ACSI) outpaced the broader stock market and generated a 40% return. Those companies combined outperformed the Dow by 93%, doubled the S&P 500 and nearly tripled the Nasdaq. According to the most recent ACSI retail data from February, Nordstrom leads all department-store retailers with a score of 83 out of 100, up 6 points from 2009. This prefaced a 44% increase in net earnings, a 17% jump in net sales and a 12% boost in same-store sales in the first quarter that ended May 1. Netflix, meanwhile, topped all Internet retailers with an 87 customer-satisfaction score, which coincided with first-quarter increases, including a 44% surge in earnings, a 25% increase in revenue and the addition of 1.7 million users. Second-place Amazon, with a score of 86, increased first-quarter sales in the U.S. by 47%. "Many consumers say companies haven't done enough to improve their approach to service in this economy, and yet it's clear they're willing to spend more with those that deliver excellent service -- suggesting substantial growth opportunities for businesses that get customer service right," says Jim Bush, American Express Executive Vice President for World Service. "It's important to see customer service as an investment, not a cost." Not every company is making the connection, as 27% of respondents in the American Express survey say they feel businesses haven't changed their attitude toward customer service and 28% say retailers are actually paying less attention to consumers' requests and complaints. Even worse, one in five consumers feel their business is being taken for granted.