A cross-industry comparison of customer satisfaction

G. Ronald Gilbert
College of Business Administration, Florida International University, North Miami, Florida, USA, and

Cleopatra Veloutsou
University of Glasgow, Glasgow, UK
Abstract Purpose This paper seeks to identify service satisfaction measures that can be used across industries. Design/methodology/approach The paper attempts to identify empirically core characteristics of customer satisfaction ratings across six industries based on the ratings of 10,835 respondents within the USA. The industries included are banking and nance, retail, government, grocery stores, hospitality/sports, and restaurants. Findings The paper nds that banking and nance and hospitality/sports entertainment were rated highest by their patrons. Those dealing with government, general retail and moderately priced fast food restaurants received lower service satisfaction ratings. Differences were also found among respondent characteristics (i.e. age, gender, education and ethnicity/race). Research limitations/implications The study sample was selected from organizations readily available to the research team. Future studies based on systematic random samples would enhance the generalizability of the ndings. Originality/value The results provide a basis from which cross industry benchmarking and the identication of best practices can be captured and used by practitioners. Keywords Customer satisfaction, Measurement Paper type Research paper

An executive summary for managers and executive readers can be found at the end of this article.

Introduction
This paper seeks to identify measures that can be used across industries for purposes of assessing customer service effectiveness. Such will enable business owners, managers, decision makers and other researchers to identify best practices in customer service design. By doing so, decision makers may further improve services to their customers and gain competitive advantage. The most widely employed models used for cross industry analysis are the American and the European Customer Satisfaction Indexes (ACSI and ECSI). These two annually produced indices provide measures of large businesses within and across industries. Reports generated by the ACSI and ECSI do not provide ratings by specic stores within a given company. Thus, in terms of their providing feedback to decision makers of specic stores within a company on a timely basis, these types of cross industry assessment tools are impractical. There is a need for the development and use of a simpler, speedier, and more practical method to assess service satisfaction in a standardized manner both within industries
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and across industries that meets the needs of managers of the business units they control. The use of measures that can be validly applied in a timely manner across stores representing a variety of industries could facilitate the improvement of a conglomerate of service outlets in commonly shared business locations such as neighborhood shopping centers, business associations, and the like.

Background
It is well established that satised customers are key to longterm business success (Kristensen et al., 1992; Zeithaml et al., 1996; McColl-Kennedy and Schneider, 2000). Companies that have a more satised customer base also experience higher economic returns (Aaker and Jacobson, 1994; Bolton, 1998; Yeung et al., 2002). High consumer satisfaction leads to greater customer loyalty (Yi, 1991; Anderson and Sullivan, 1993; Boulding et al., 1993) which, in turn, leads to future revenue (Fornell, 1992; Bolton, 1998). Organizations having superior service quality have been found to be market leaders in terms of sales and long-term customer loyalty and retention (Anderson and Sullivan, 1993; Boulding et al., 1993; Eklof and Westlund, 2002). Because of this, organizations competing in similar market niches are compelled to assess the quality of the services they provide in order to attract and retain their customers. Customers expectations are derived from their own accumulation of contacts with services provided them in all walks of life. From such contacts customers accrue a generalized service expectation or standard based on their day-to-day history as customers. It is from the accumulation of these service experiences that customers establish personal standards and use them to gauge service quality. Intuitively, 298

Journal of Services Marketing 20/5 (2006) 298 308 q Emerald Group Publishing Limited [ISSN 0887-6045] [DOI 10.1108/08876040610679918]

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Journal of Services Marketing Volume 20 Number 5 2006 298 308

they could create idiosyncratic standards of service across industries in terms of their requirements from the tangible and intangible dimensions of the services (Gronroos, 1984; Nicholls et al., 1998). That is, they might have different expectations in how they may be treated and the personal service they may expect as a customer at a banking institution than how they are likely to be treated at a concession stand at a sports event. This may include expectations of both the quality of the service setting and the personal service received. It is important to assess the relative service quality provided customers not only within industries, but across industries to identify best practices and benchmarks to facilitate the transfer of highly desired practices to less customer service oriented industries, the central purpose of this paper.

Organization of the paper

The paper provides a brief review of some of the relevant approaches that have been used for the measurement of customer satisfaction. It then discusses different views that have been developed in relation to the transferability of satisfaction measures across industries and outlines the research questions addressed in this investigation. The methodology used for the collection of the primary data is then outlined. In the ndings section, customer ratings are reported based on statistical differences found while controlling for the possible effects of customer age, gender, education, and ethnicity/race, for such have been reported to inuence customer satisfaction ratings (Gagliano and Hathcote, 1994; Tucker and Adams, 2001; Gilbert, 2003). The concluding section addresses the study limitations, managerial implications, and recommendations for further research.

were more distant in time between the service encounter and the customers rating. Some researchers may use a single item measure to capture service satisfaction (i.e. Yuksel and Rimmington, 1998; Leisen and Vance, 2001). However, it is generally accepted that customer satisfaction measurement is a complex construct, and the use of multi-item scales is preferred, as such provides greater insight about consumer satisfaction from the perspective of the consumer than is possible from a single item measure, per se. Multi item measures can provide empirically based levels of scale reliability that are not possible with a single item measure. Therefore, multi-item measures describing various aspects from which consumer satisfaction may be derived are preferred in order to help explain the construct of service satisfaction in a valid way (Nunnally, 1967). Brief reviews of some of the more dominant approaches to measuring customer satisfaction are presented below. Conrmation-disconrmation approach This method is based on a comparison of the customers expectations versus what the customer actually experienced (Yuksel and Rimmington, 1998). A tool of particular note is the Customer Satisfaction Index (CSI), which is widely used in the USA (ACSI) and Europe (ECSI). It has been extensively applied (Fornell et al., 1996; Anderson and Fornell, 2000; Martensen et al., 2000; Dermanov and Eklof, 2001; Fornell, 2001; Eklof and Westlund, 2002; Yeung et al., 2002). The CSI scores pertaining to customer satisfaction function as intangible economic indicators, and are used to monitor the nancial viability of companies, industries and international trade unions (Anderson and Fornell, 2000; Fornell, 2001). They serve as gross assessments of the viability of large economic blocs in the USA and Europe. The CSI method is based on predictive models that are comprised of prior customer expectations, perceived quality based on the customers post service assessments, and the customers perceived value (product versus price) which lead to the creation of a customer satisfaction index (CSI) score ranging from 0-100. The post service assessments are completed by telephone and are comprised of the customers ratings on three criteria: overall quality, reliability, and meeting the customers needs. The national CSIs measure the quality of goods and services as experienced by those who consume them. An individual rms CSI represents its served markets (i.e. customers) overall evaluation of the total purchase and consumption experience, both actual and anticipated (Anderson and Fornell, 2000). Performance-only approach This method measures service features related to transitionalspecic service satisfaction (both technical and functional). One such performance approach method reported in the literature is the Customer Satisfaction Survey (Gilbert et al., 1997; Nicholls et al., 1998). The instrument measures customers satisfaction immediately following a service episode. It includes technical and functional transitionspecic features, as well as service quality and service satisfaction measures. It consists of two measures that were empirically derived through factor analysis applications: satisfaction with personal service (SatPers) and satisfaction with the service setting (SatSett). Each of these two factors 299

Measurement of consumer satisfaction

The importance of measurement of customer service is well established in marketing and management literature. Yet, there is no universally accepted method or measurement scale that exists. Indeed, the measurement of consumer behavior and customer satisfaction is more exploratory in its development rather than a precise, exact science. There are several theories pertaining to the best method to assess customer satisfaction. Among the more dominant, (but not inclusive of all theories associated with customer satisfaction measurement) include the expectancy-disconrmation approach, the performance-only approach, the technical and functional dichotomy approaches, the service quality versus service satisfaction approach, and the attribute importance approach (Gilbert et al., 2004). Furthermore, there are variations in the way that satisfaction is measured in terms of scales used, format of the questions and the data collection methods (Wilson, 2002). In general, it is agreed that customer satisfaction measurement is a post-consumption assessment by the user about the product or service gained (Churchill and Surprenant, 1982; Yuksel and Rimmington, 1998). Also, there is a general agreement that the closer the assessment is to the actual service encounter, the more accurate the assessment of the service quality, itself. As stated by Mittal et al. (1999), attributes that are experienced closer to the time of the customers nal evaluation tend to inuence the customers overall ratings more than do those attributes that

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was validated from a cross section of industries within the USA. The two are generic to most industries rather than specic to any one industry, meaning they could possibly be applied to assess service quality in most cross industry settings. Essentially, these two measures were focused on the customers personal reaction to the service delivery and to the environment in which it is delivered. The measures are based on the perceived quality of service and product features experienced in the service encounter much like the SERVPERF model (Cronin and Taylor, 1992). Overall satisfaction Jones and Suh (2000) suggest that two distinct types of consumer satisfaction exist the transaction specic and overall satisfaction. Transaction specic satisfaction is related to a specic encounter with the organization, whereas overall satisfaction is a cumulative construct summing satisfaction with specic products/services of the organization with various other facets of the company (Garbarino and Johnson, 1999). The overall rating resembles a more general attitude the customer has toward the specic products or services provided by the organization. It is more like a stored evaluation in ones memory than an on-the-spot evaluation. Such an overall impression is relatively stable over time and less sensitive to question order effects or other transition specic reactions on the part of the customer (Auh et al., 2003).

Cross-industry satisfaction measurement: the pros and cons

Practitioners and theorists alike have expressed interest in cross industry applications of customer service measurement (Naylor and Bardi-Kleiser, 2002; Yuksel and Yuksel, 2002), while others have focused on customer satisfaction measurement across national boundaries (Frazer-Winsted, 1999; Crotts and Erdmann, 2000; Spreng and Chiou, 2000; Chen-Yu et al., 2001). Practitioners have much to gain by nding ways to compare customer satisfaction across industries and cultures, for they could not only gauge performance within their industries, but from such measures they could also identify superior practices that attract customers in other industries. By doing so, they may be enabled to expand their understanding, working assumptions, and ability to satisfy the customers (potential and current) whose satisfaction they rely on to remain in business. Some argue that it is very difcult to develop a reliable and valid measure to capture satisfaction in all industries (Wilson, 2002). Yet, others contend that there is a great need for such a measure for purposes of continuous benchmarking and improvement. Indeed, practitioners need to have universally accepted scales to measure user satisfaction across industries, for such standardized measures will enable them to gauge the relative effectiveness of their own organization when compared with the performance of their competitors. Such benchmarking is a continuous process of measuring the practices of practitioners own organizations against those of their toughest competitors, as well as with those recognized as leaders of other industries (Black and Gregersen, 1999). The ACSI and the ECSI have been developed to aid practitioners in their need for information they can use to gauge the performance of their organizations within and among specic industries. The CSI conducts annual analyses of customer service quality in at least 35 separate industries, 300

190 companies, and government agencies. In their analyses across various industries, the researchers often argue that their model, their scales, and their measurement seem to be sufciently exible for application in different industries (Grnholdt et al., 2000), and that customer expectations have negligible impact on the formation of satisfaction (Martensen et al., 2000). There are other examples using less complicated measures than that of the CSI, wherein it is possible for practitioners to apply more real time, cross industry customer satisfaction indicators. Some studies reported in the literature revealed that the same measures could be used to capture satisfaction for sectors with certain similarities. Nicholls et al. (1998) were able to compare hospitality-oriented and sports-oriented businesses using the identically same customer satisfaction measures. Additionally, in their exploratory research, Nicholls et al. (1998) investigated measures that might be used to gauge customer satisfaction in ve public and ve private sectors, and their ndings revealed promising cross industry applications. Furthermore, McDougall and Levesque (2000) investigated the role of the service quality promise, the perceived value, and the relational service quality (the delivery) in the determination of customer satisfaction in four service sectors. Their investigation revealed that all of these determinants were found to have statistically signicant effects on overall service satisfaction. On the other hand, the ndings of some researchers are less supportive of the efcacy of cross industry customer satisfaction comparisons (Winsted, 1999; de Ruyter and Wetzels, 2000; Bebko, 2000; Dermanov and Eklof, 2001). Their ndings suggest that consumers assessments of service quality can be idiosyncratic to specic service industries. Hence, it could be suggested that the use of the same scale to measure the level of satisfaction with various service offerings is not advisable, since the dimensions that are evaluated by the consumers during such an analysis of service offerings may vary among the services, themselves.

Research problem
As indicated in the review of the above studies, there appear to be identiable schools of thought in relation to the measurement of customer satisfaction across industries. One school proposes that the same, reliable and valid measures could be used in all contexts (across industries and across national boundaries). Some identied with this school of thinking suggest that given that the industries under investigation and the customer base have certain similarities, the same measurement can be used across industries. However, the antithesis of the pro cross- industry measurement school suggests that the formation of satisfaction is so highly dependent on unique organizational contexts that generic measures are not useful, and specic measurements should be developed to capture the construct every time that one attempts to examine customer satisfaction in a given service situation. Hypotheses Based on the different views expressed by researchers in the past, this study aims to test two relevant research hypotheses: H1. Specic measures can be used across various service industries to capture the level of customers satisfaction with services provided.

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H2.

The application of such measures will reveal no differences in the level of satisfaction consumers experience across service industries.

Methodology
Data collection instrument The Customer Satisfaction Survey (Gilbert et al., 1997) is the preferred approach to measure satisfaction in this study. This is because of its greater reliability and validity compared to the disconrmation approach where the difference between the customers expectations and quality perceptions are estimated (Bou-llusar et al., 2000; Parasuraman et al., 1996). When measuring across ve public and ve private sector industries, the ndings of Nicholls et al. (1998) revealed that the SatPers factor was reported to have a Cronbach reliability alpha of 0.89 while the SatSett factor had a reliability alpha of 0.74. Convergent validity r correlations with an overall statement of customer product and service satisfaction were 0.77 and 0.65, respectively. The two measures from this instrument appear to be well suited as a starting point to measure customer satisfaction across a broader, more diverse and larger set of industries. The Customer Satisfaction Survey employs a ve-point Likert-type rating scale (1 strongly disagree; 5 strongly agree) and consists of 18 statements. A total of 17 of these statements address service and product features, and the 18th statement is a criterion statement pertaining to overall service quality. (Tests for convergent validity are accomplished by the measurement of the association between variables 1 through 17, and the factors derived from them, and the criterion statement.) The multiple option, polar adjective type scale was used in this study for purposes of increasing the power of measurement. Binary (agree/disagree) scales that are sometimes used in customer satisfaction tools, impede measurement precision, validity, and predictive power of the ndings, and are likely to be poor (Anderson and Fornell, 2000). Examples of statements in the Customer Satisfaction Survey that the customer respondents were asked to indicate the extents to which they disagree or agree include:
The place is neat and clean. The employees treat me as a valued customer. There is easy access to the organizations services. They take time to understand my needs.

Data gathering procedure Trained interviewers and supervised graduate and undergraduate students were employed to administer the Customer Satisfaction Survey to patrons of business and government organizations representing six different industries. The organizations were based primarily in Dade (Miami) and Broward (Fort Lauderdale) Florida, with some limited sampling from a government agency in Denver, Colorado, and a large banking and nance organization in the Sacramento, California area. The agencies selected in the sample were based on convenience and availability. The surveys were administered in these agencies to randomly selected patrons immediately after they had completed their service encounter. No monetary incentives were given to the respondents. Respondent participation was based solely on 301

their willingness to participate in the survey when requested to do so by those trained interviewers who approached them. Responses were considered invalid cases if the respondents ratings did not vary, i.e. having answered every statement the same (i.e. answered with all 5s or all 1s, or the like). In such cases, they were deemed invalid and were removed from the sample. Likewise, if a respondent did not fully complete the survey (i.e. failed to respond to more than 10 percent of the 18 statements in the survey), the survey was not included in the analysis. The sampling procedure was based on a systematic probability sampling approach one of the most prevalently employed types of sampling techniques. The sampling objective of the researchers was to secure a degree of economic efciency within a short time period while attempting to attain representativeness through systematic sampling of available customer service establishments representing the six industries included in this study. Once the sampling was initiated at each service site, the surveyors employed a skip interval approach when selecting the customers to be included in the sample. This procedure ensured sufcient randomness in the sample to approximate a known and equal probability of any person in the population being selected into the sample. Note: no precise record was kept pertaining to the percent of customers who declined to complete the questionnaire or failed to respond to the questionnaire in a valid manner. Based on discussions with members of the survey teams, it is estimated that about 20 percent refused to complete the survey or were omitted because of their inability to answer the questionnaire due to language or reading handicaps. It is estimated that less than 5 percent of the questionnaires were invalidated due to incomplete responses. (In the future, accurate records of these rejection rates will need to be kept and reported.) In this study, 10,993 customers were sampled representing six industries: nanking and nance (16 banks and credit unions, n 3; 230); retail (eight stores, n 876); government service (16 state, local and federal agencies, n 2; 111); grocery stores (nine establishments, n 1; 724); hospitality (ten cruise ships, sports and entertainment establishments, n 1; 755); and restaurants (16 restaurants and fast food establishments, n 1; 297). Within the banking and nance industry were a credit union and established banks having branches where customers walked in to make their transactions. The retail sample included typical stores such as ofce or home depot, car rentals, sports clothing and equipment outlets, and the like. The government industry included federal, state and local public organizations such as social security, department of motor vehicles, and planning and zoning that served end user customers who had direct personal contact with the government agencies as recipients of service. The grocery store industry included typical large grocery chain stores. The hospitality industry included organizations such as thoroughbred horse racing establishments, arcades, and cruise ship lines. The restaurants consisted mainly of fast food establishments such as McDonalds, Burger King, and the like, as well as some other moderately priced steak houses and family owned cafes. Four demographic characteristics of the respondents were also captured. They include age (1 # 40, 2 40 and over); gender (1 male; 2 female); education (1 , two years of

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college; 2 two years of college and above); and ethnicity/ race (1 non-Caucasian; 2 Caucasian). Table I reveals the distribution of age, gender, education and ethnicity/race among the six industries analyzed. Signicant differences in demographic characteristics among the respondents in all six industries were found to exist by age, gender, education, and ethnicity/race. The data indicate that the respondents from the restaurant and retail industries were younger than the others. Females were notably more likely than males to represent the sample from the retail industry, while males were more highly represented in the hospitality/sports industry. Those consumers in restaurant, hospitality/sports, and retail industries tended to have lower education, while those in banking and nance, government, and grocery store industries tended to have higher education. In terms of ethnicity/race composition, nonCaucasians tended to be more highly represented in all but the hospitality/sports industry. Thus, these differences in demographic composition by industry were viewed to be important to be analyzed in terms of any mediating effects they might have on differences in ratings identied by industry on each of the two customer satisfaction measures.

Findings
Although the scales used in this paper have been taken from the literature, before employing them for comparative purposes their reliability in this specic context has to be determined. The Cronbach alpha of the SatPers is 0.91, while the value for the SatSett is 0.78. They are both in excess of the 0.70 benchmark. In Tables II and III, the reliability of the scales is conrmed by the Pearson inter-correlation of the items included in this scale, which are all positive, high and signicant at a 0.001 level. Furthermore, the item-to-total correlation for all items is very close or higher than the suggested 0.50 benchmark (see Bearden and Netemeyer, 1999). All items contribute to the robustness of the scales, since the removal of any of these items will reduce the value of the Cronbach alpha. The same analysis was performed for each sector under investigation and produced similar results. The factors were found to be equivalent within each industry as well as across the industries that were included in the study sample. Thus, H1 was accepted. Table I Demographic characteristics of the study sample by industry
Age < 40 Industry Banking/nance Retail Government Grocery Hospitality/sports Restaurants Chi square DF p $ 40 % Male % 48.9 31.6 36.3 42.4 51.2 27 Gender

Table IV, identies differences in respondent customer satisfaction ratings on the two measures, SatPers and SatSett that exist within the Customer Satisfaction Survey. The univariate analysis (ANOVA) without accounting for demographic differences reveals signicant variation among the six industries based on the ratings received from their customers. The ratings by those in the banking and nance industry were higher than all others in both SatPers and SatSett. The ratings attributed to hospitality/sports were also higher than most others on both of these measures. The customers of government agencies tended to rate their satisfaction with personal service and with the service setting lower than all others. Customers in the retail industry also tended to rate their satisfaction lower than did most others. The differences identied by the ANOVA statistical tests may be a result of biographical differences of the respondents rather than as a result of the industry, per se. As revealed in Table I, the study samples for each industry varied based on the demographic characteristics. Such differences captured by the ANOVA application may not be a result of true differences in customer service satisfaction by industry type, for the ratings may be inuenced by the asymmetrical demographic features associated with each industry. Thus, MANOVA and MANCOVA statistical applications were administered to assess the difference in respondent ratings by industry when controlling for age, gender, education and ethnicity/race. Table V reveals the results from the MANOVA and MANCOVA applications. It identies the estimated adjusted means for each industry after accounting for the rating differences associated with the four demographic characteristics. The MANCOVA analysis identied signicant differences by industry among the ratings of the two factors when controlling for respondent age, gender, education and ethnicity/race (Wilks L 0:914, F 10;000 69:11, p , 0:001). The differences identied by the Bonferroni post hoc tests revealed the following variations in ratings on the SatPers measure of customer satisfaction: Banking and nance was rated higher than all others (p # 0:001). Retail was rated higher (p # 0:001) than government, about the same as grocery stores, and lower (p # 0:001) than hospitality (p # 0:030) and restaurants (p # 0:014). Government was rated lower than each of the others (p # 0:001). Grocery stores was rated higher than government (p # 0:001) and

Education Female n % <2 years n % 631 47.7 503 58.1 830 47.4 756 47.7 893 53.1 695 55.1 50.68 5 ,0.001 $2 years n % 693 363 920 829 788 566 52.3 41.9 52.6 52.3 46.9 44.9

n
1,463 274 676 689 868 340

Ethnicity/race NonCaucasian Caucasian n % n % 1,073 61.9 698 81.0 1,195 67.9 911 57.7 699 40.2 872 69.5 543.06 5 ,0.001 660 164 565 669 1,041 383 38.1 19.0 32.1 42.3 59.8 30.5

1,526 51.1 593 68.4 1,187 63.7 899 56.6 827 48.8 920 73 299.54 5 , 0.001

1,621 54.8 380 44.0 1,044 50.7 794 50.3 1,051 60.6 619 49.6 87.19 5 ,0.001

1,336 484 1,016 786 683 629

45.2 56.0 49.3 49.7 39.4 50.4

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Table II Evaluation of the satisfaction with the personal service scale

2 1. 2. 3. 4. 5. Provider courtesy Timely service Competent employees Easy to get help Treatment received 0.70 0.70 0.67 0.70 Pearson correlation 3 4 5 Item-to-total correlation 0.80 0.75 0.79 0.78 0.77 Cronbach alpha if item deleted 0.89 0.90 0.89 0.89 0.89

0.65 0.67 0.63

0.70 0.70

0.68

Table III Evaluation of the satisfaction with the service settings scale
2 1. 2. 3. 4. Convenient operating hours Neat and clean place Security within the organization Security outside the organization Pearson correlation 3 4 Item-to-total correlation 0.50 0.60 0.68 0.60 Cronbach alpha if item deleted 0.78 0.73 0.69 0.73

0.45 0.42 0.38

0.56 0.45

0.63

Table IV Analysis of variance of customer ratings by industry

Industry Banking and nance Retail Government Grocery stores Hospitality/sports Restaurants Total Df MS F P-value SatPers SatSett Sample size Mean SD Sample size Mean SD 3,158 4.40 876 3.79 2,090 3.54 1,703 3.92 1,745 4.08 1,263 3.98 10,835 4.01 5 199.44 286.49 ,0.001 0.77 0.77 0.97 0.92 0.74 0.80 0.89 3,158 4.31 875 3.92 1,986 3.66 1,697 4.00 1,529 4.14 1,257 3.89 10,467 4.03 5 115.15 197.64 , 0.001 0.72 0.69 0.84 0.85 0.70 0.76 0.80

Note: Means are based on a 1-5 Likert-type scale (1 strongly disagree to 5 strongly agree)

lower than banking and nance (p # 0:001). Hospitality/ sports was rated lower than banking and nance (p # 0:001) and higher than retail (p # 0:030) and government (p # 0:001). Restaurants was rated lower than banking and nance (p # 0:001) and higher than retail (p # 0:014) and government (p # 0:001). Post hoc tests were also conducted on the ratings of the SatSett measure based on each of the six industries. Banking and nance was rated higher (p # 0:001) than four of the ve other industries. When compared to hospitality/sports, the banking and nance industry was also rated signicantly higher, but the difference between the two was not as strong (p 0:039). Retail was rated lower than banking and nance (p # 0:001) and hospitality/sports (p # 0:001). Retail was rated higher than government (p # 0:001). Government was rated lower than all other industry types (p # 0:001). Grocery stores was rated lower than banking and nance (p # 0:001) and hospitality/sports (p # 0:001). It was rated higher than government (p # 0:001). Hospitality/sports was rated higher

Table V Differences in ratings by industry when controlling for respondent age, gender, education and ethnicity/race
SatPers Industry Banking and nance Retail Government Grocery stores Hospitality/sports Restaurants Total Sample sizea 1,238 854 1,494 1,535 1,433 1,206 7,760 Adjusted meanb 4.23 3.88 3.39 3.92 4.00 4.01 3.91 Sample sizea 1,238 854 1,494 1,535 1,433 1,206 7,760 SatSett Adjusted meanb 4.21 3.96 3.55 3.99 4.12 3.91 3.96

Notes: a Sample shrinkage from Table II is mainly due to an inability to ask about the respondents demographic characteristics, as the managers of some of the organizations that were involved in the study were concerned about customer reactions to them a privacy issue; b Adjusted means calculated at means of covariates (age, gender, ethnicity/race, education); Means are based on a 1-5 Likert-type scale (1 strongly disagree to 5 strongly agree)

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(p # 0:001) than all other industries except banking and nance. When compared to banking and nance, it was rated lower (p # 0:039). Restaurants was rated lower than both banking and nance and hospitality/sports (p # 0:001). It was rated higher than government (p # 0:001). The lower ratings identied by government organizations need to be placed in perspective with the type of customers they generally serve. As identied in their study of customer service in government, Gilbert et al. (1998-1999) measured service satisfaction among different types of government customers labeled as direct buyers, clients or captives. Their ndings reveal that when customers of government agencies have limited choice (i.e. clients or captives to their government suppliers) in terms of where they can get the service or product they need, the service is much like the lower results identied in this study. However, when government organizations operate in a more competitive environment where their customers are able to behave as direct buyers, and have the opportunity to choose the government supplier or go elsewhere within a free and open market, the direct buyer type government customer rates the government agency equally as good (if not better) than its private sector counterparts. Agencies in the USA federal government that serve direct buyers would include agencies such as the General Service Administration, US Ofce of Personnel Managements training centers, US Parks service, or NASA weather photographic services or like organizations where customers can either purchase their services or go elsewhere for the products or services they seek. From the discussion above it is conrmed that H2 is rejected.

pertinent to most of the industries that were included in the study sample. In this study, such data were not recorded. The study ndings are also limited by the small sampling of industries. Samples from local, state and federal governments would add to the generalizability of the ndings as they pertain to government service satisfaction. Also, the study should have included a broader array of service industries, for such would add to the usefulness of the ndings. While the factors derived from the survey instrument were originally established from a broad range of industries, their accuracy could be further assured by systematically retesting them within each of the industries included in this study. Furthermore, added analysis could help identify specic behaviors and best practices in the organizations that were rated exceptionally high so that others could gain added insight about cause-effect relationships in situations where service quality has been found to excel.

Study inferences
Service organizations that are highly dependent on the satisfaction of their customers need to establish standards from which their own customer satisfaction performance can be compared and improved on a continuous basis. It is important that such organizations not only benchmark themselves against the best practices in their own industries, but that they also transcend their own market niches and identify best practices among industries outside of their own competitive areas. By doing so, they can not only make incremental improvements based on learning from others within their industries, but they can also make quantum leaps in how they serve their customers by seeing how service is constructed and delivered by organizations working under different assumptions and business paradigms then their own. It is the expectation of the authors of this study that this research effort provides a methodological orientation and some preliminary ndings that may be useful to others interested in learning about cross-industry service quality. Two research hypotheses were tested: H1 specic measures can be used across various service industries to capture the level of customers satisfaction with services provided; and H2 the application of such measures will reveal no differences in the level of satisfaction consumers experience across service industries. With regard to H1, the study provides a basis from which practitioners can measure the performance of the organizations they manage, and obtain near real time feedback that they can use to improve the personal service and the service settings of their stores or work locations. In terms of H2, the data analysis indicated that customer satisfaction does differ across industries, and that both the banking/nance and hospitality/sports industries seem to please their customers more than the other industries analyzed in this research undertaking.

Study limitations
Among the greatest limitations of this study sample is that the selection of the organizations representing the various industries was not based on systematic randomization. Although the sample sizes are relatively large, much more representative data from each of the six industries are needed in order to support the generalizability of the study ndings. More accurate accounting of rejection and decline rates of customers surveyed is needed, for such information would shed added light on the potential bias of the sampling process used in this data gathering procedures employed in this study. Were there specic groups that tended to decline the invitation to complete the survey more than others? Were the interviewers more likely to gain the cooperation of certain types of respondents more than others? Did the use of the predominantly English version of the survey inadvertently serve to omit those whose rst language was Spanish, Creole or Portuguese (languages often preferred by some of the potential customers in the study sample)? The use of trained students to gather most of the data used in this study was the most convenient alternative for the principal investigators. However, although the students were trained in data gathering methods, they were not always closely supervised, and such should be more systematically adhered to in future, follow-up studies. The sampling failed to capture information pertaining to the time of day or day of the week the data were gathered. Thus, it was not possible to match specic sampling times with customer service rating differences. The need for capturing time of day and day of week is especially 304

Practical implications of ndings

Managers use of customer satisfaction measures to improve organizational performance has become an imperative in todays business environment. Satisfaction with service quality is related to bottom line results. Sophisticated indices are being developed to assess the quality of service of large, multiproduct companies, industries and economic markets. Indices

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such as the ACSI and ECSI are engaged in broad based assessments of customer satisfaction. However, they are not likely to provide the type of information on a timely or useful basis as is needed by managers of business enterprises functioning in highly charged, rapidly changing niche markets like the international fast food industry. Thus, there remains a need to provide individual store managers scientically based means to gauge the service quality of their own operations within their own unique market niches on a real-time basis, and in highly practical ways. The use of such measurement tools could help store managers nd new ways to gain and retain customers through their own continuous improvement practices. Quicker, just-in-time assessments for store managers The application of the SatPers and the SatSett measures can aid managers to assess the service quality of their own establishments compared to others in their specic industries in a timely and useful manner. Periodic and repetitive sampling of customers assessments of the service quality of their businesses can enable managers to apply statistical process control and Motorolas six sigma techniques (Messina, 1987; Reicheld and Sasser, 1990) to improve the quality of their products and services and facilitate the continuous improvement within their organizations. Multiple stores comparisons within the same organization Some companies may have several geographically dispersed stores operating within the same industry. Applications of measures such as SatPers and SatSett at each store location can enable managers to gain insight about the relative service and product quality of each specic store they manage. This would enable them to gauge the reliability of their service quality at each store and pinpoint where the greatest opportunities for improvement may exist, store by store. Such measures would also make it possible for managers of multiple stores to identify best practices that can be replicated elsewhere among their internal business units. Insights about government and private sector practices Government is charged with the expectation that it deliver products and services equally as well as the private sector. The current American presidential administration has set as its agenda the reform of federal agencies. It promotes more customer focus and market-driven approaches in the manner in which it conducts its business, and as a result Citizens will recognize improved service, and performance and citizen satisfaction will increase (US OMB, 2002, p. 14). The ndings from this study that relate to service satisfaction with government agencies provide important insight into the relative friendliness of government service delivery systems used to meet the needs of its public. Integrating services and products from different industries Today, organizations identied with specic industries are merging with other high name recognition organizations that have been traditionally identied with other industries to facilitate one stop shopping at more centralized locations. For example, multi service gas stations are growing into multi service centers that cater to the needs of having broader needs be met. Some gas (petrol) stations and toll plazas are now 305

offering name brand quick food services such as Kentucky Fried Chicken, Pizza Hut, Starbucks, Miami Subs, McDonalds, Burger King, Nathans Hot Dogs, Dunkin Donuts, and other well known products that customers associate with other industries. Shopping malls also bundle retail with fast food restaurants. The offering of these products at such multi service outlets may, indeed, change the customers expectations of the products and services they have traditionally associated with these well known name brands. That is, is the shopping experience at Kentucky Fried Chicken or McDonalds offered at a multi service gas station center or a shopping mall equivalent to the products and services that are expected and experienced at the same franchises when they are functioning independently and when the shopper comes in solely for a single fast food service or product? If the customers accumulation of experiences of service quality at service stations has been less than that of fast food establishments, then the expectations of the service quality of franchises such as Kentucky Fried Chicken may also be lowered. Thus, the overall customers expectations of Kentucky Fried Chicken may be lowered because of the lower quality of service experienced at a quick service gas station. The change in perceived service quality may be inuenced by the lowered (or raised) customer expectations associated with the core industry where the services of merged industries are offered. Today, United Air Lines serves food wraps prepared by Bennigans restaurants. The quality of service and food on United Airlines may well affect customer loyalty and more generalized expectations of the Bennigans food chain. Rather than permit less effective service oriented industries to dominate the service offering, practitioners may want to borrow from the practices of industries that are superior, and use them to improve the service quality of the integrating industry without lowering the standard of the products that they are integrating. Could Bennigans enable United Airlines to improve their services? Could Dunkin Donuts help change the quality of service of gas stations? This would seem to be another reason practitioners would opt to learn about service satisfaction across industries and use such knowledge to improve customer service in the systems they manage.

Summary and conclusions

The perception of customer service quality has well been demonstrated to be key to customer retention and the longterm nancial success of most organizations. Yet, consumer satisfaction is derived from the customers comparison of the customers actual experience with a service episode contrasted with the customers service expectation. Such expectations are derived from both ideal and comparative standards what should service be and what can the customer realistically expect based on what the customer has previously experienced. Ultimately the answers to these two questions are idiosyncratic they are uniquely dened from person to person, contact by contact. It is known that service quality varies within industries, and, because of this, organizations competing in similar market niches are compelled to monitor both the practices of their competitors and their own behavior in order to attract and retain their customers. Unlike marketing experts and business strategists, most customers do not cognitively classify their service experiences and service expectations based on particular market niches. Rather, they accumulate a

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generalized service expectation or standard based on their day-to-day history as customers. This study has attempted to provide added insight into the signicant variance in service quality from the eye of the customer. It also sharpened the focus on some types of industries that seem to do better than others. The study has surfaced some evidence that service satisfaction may also vary as a result of customers biographical characteristics. While the causes for such differences are not known, such differences in satisfaction may be indicative of an unequal level of service quality that is provided those in some industries or organizations. Indeed, organizations are charged with the obligation to be culturally competent, and the data may indicate that more needs to be done to assure that this organizational obligation is realized. The implications of analysis of cross industry satisfaction ratings hold great promise for measuring the service quality of service outlets such as neighborhood shopping centers, consisting of multiple industries, best in class-type benchmarking, development of industry specic standards, and user friendly methods for managers of business enterprises to gauge the quality of their services and products to further their own continuous improvement efforts. Quite possibly the study has also helped identify an important area for future research in consumer behavior that merits added attention.

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Further reading
Bloemer, J., de Ruyter, K. and Wetzels, W. (1999), Linking perceived service quality and service loyalty: a multidimensional perspective, European Journal of Marketing, Vol. 33 Nos 11/12, pp. 1082-106. Cross, T.L., Barzan, B.J., Dennis, K.W. and Isaacs, M.R. (1989), Towards a Culturally Competent System of Care. A Monograph on Effective Services for Minority Children who are Severely Emotionally Disturbed, Vol. I, Georgetown University Child Development Center, Washington, DC. Dehisten, F. (2003), Avoiding the customer satisfaction rut, MIT Sloan Management Review, Summer, pp. 73-7. Lorenzo, M.K., Pakiz, P.B., Reinherz, H.Z. and Frost, A. (1995), Emotional and behavioral problems of Asian American adolescents: a comparative study, Child and Adolescent Social Work Journal, Vol. 12 No. 3, pp. 197-212.

Corresponding author
G. Ronald Gilbert can be contacted at: Gilbert@u.edu

Executive summary and implications for managers and executives

This summary has been provided to allow managers and executives a rapid appreciation of the content of this article. Those with a particular interest in the topic covered may then read the article in toto to take advantage of the more comprehensive description of the research undertaken and its results to get the full benet of the material present.

A cross-industry comparison of customer satisfaction Good companies know that nding out what their customers think of the service they provide matters and matters a lot. Feedback about whether or not expectations are being met is crucial for managers. To say that satised customers are key to long-term business success may be a statement based on worthy research, but it is also a blindingly obvious one, as is the nding that organizations which have superior service

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Journal of Services Marketing Volume 20 Number 5 2006 298 308

quality are market leaders in terms of sales and long-term customer loyalty. Knowing that is the easy bit. The hard bit is nding out just what your customers think, and the even harder part is trying to nd out how their opinions match those of competitors customers. To make the problem even tougher, managers also have to be aware that customers tend to have different expectations for different experiences. For instance, they might have a different expectation of having a Starbucks coffee in a retail store than buying one at a gas station. If the experience at the gas station is good or bad, does the nature of the service encounter count as a plus or minus for the coffee company or the fuel station? Similarly, if you are served up a well-known branded snack on an airline, does the airline go up or down in the customers estimation depending on the snack or vice versa? And if customers have different expectations of the quality of service they might get at bank than at a concession stand at a sports event, why? It is a complicated subject and no wonder that there is no universally accepted method or measurement scale that exists. Indeed, the measurement of consumer behavior and customer satisfaction is more exploratory in its development rather than a precise, exact science. Yet the importance of measurement of customer service is well-established in marketing and management literature. What is needed is a simple, fast and accurate way of assessing service satisfaction in a standardized manner both within and across industries that meets the needs of managers of the business units they control. G. Ronald Gilbert and Cleopatra Veloutsou say: The use of measures that can be validly applied in a timely manner across stores representing a variety of industries could facilitate the improvement of a conglomerate of service outlets in commonly shared business locations such as neighborhood shopping centers, business associations, and the like. There are, of course, the widely used American and the European Customer Satisfaction Indexes (ACSI and ECSI), both produced annually, but impractical in terms of providing the timely and specic feedback needed by managers of business enterprises functioning in highly charged, rapidly changing niche markets like the international fast food industry. The central purpose of the paper is to assess the relative service quality provided, not just within industries, but also across industries, so the best practices and

benchmarks that are identied can be transferred to organizations which have lower standards. Assessing the opinions of nearly 11,000 customers of banking and nance, retail, government, grocery stores, hospitality/sports and restaurant service providers, Gilbert and Veloutsou concluded that specic measures can be used across various service industries to capture the level of customers satisfaction with services provided, the consequence being that cross-industry benchmarking and the identication of best practices can be captured and used by practitioners. Unlike marketing experts and business strategists, most customers do not cognitively classify their service experiences and service expectations based on particular market niches. Rather, they accumulate a generalized service expectation or standard based on their day-to-day history as customers. There remains a need to provide individual store managers with scientically based means to gauge the service quality of their own operations within their own unique market niches on a real-time basis, and in highly practical ways. The use of such measurement tools could help them nd new ways to gain and retain customers through their own continuous improvement practices. The application of satisfaction with personal service (SatPers) and satisfaction with the service setting (SatSett) measures can aid managers to assess the service quality of their own establishments compared with others in their specic industries in a timely and useful manner. Periodic and repetitive sampling of customers assessments of the service quality of their businesses can enable managers to apply statistical process control and Motorolas six sigma techniques to improve the quality of their products and services and facilitate their continuous improvement. The implications of analysis of cross industry satisfaction ratings hold great promise for measuring the service quality of service outlets such as neighbourhood shopping centers, consisting of multiple industries, best in class-type benchmarking, development of industry specic standards, and user friendly methods for managers of business enterprises to gauge the quality of their services and products to further their own continuous improvement efforts. (A precis of the article A cross-industry comparison of customer satisfaction. Supplied by Marketing Consultants for Emerald.)

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