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New ACSI Report Sees Hope for Economy/Consumer SatisfactionMay 20, 2008 By: George Dooley
After a year of stalling and falling, the American Customer Satisfaction Index (ACSI) said it reversed course and registered its first gain in a year. The Index jumps 0.4 percent to 75.2 on ACSI’s 100-point scale, according to the quarterly survey.
The improvement in ACSI scores may boost consumer spending and jump-start the economy, ASCI says. But conditions are much different than they were the last time a reversal in ACSI signaled recovery from the economic downturn in 2000 and 2001, primarily because consumers’ ability to spend is more limited today.
“Households are under pressure from falling housing prices, tight credit, and rising food and fuel costs, making it more difficult for satisfied consumers to spend more even if they want to,” said Claes Fornell, founder of the ACSI. “The smart move for companies in this economic environment is to make sure they keep the customers they have by shoring up their customer relationships.”
The ACSI said customer satisfaction with airlines dropped to its lowest point since 2001, falling for the third year in a row. Faced with the soaring cost of jet fuel, airlines are raising ticket prices, overbooking flights, and charging extra fees for checking more than one bag and for “premium” seats.
Continental Airlines and US Airways suffered the largest nosedives. Continental’s ACSI score plummeted 10 percent to 62, while US Airways fell 12 percent to 54. The four airlines at the bottom of the industry are also in various stages of merger talks. United Airlines, which scored 56 for the second consecutive year, is contemplating a merger with US Airways. Northwest (-7 percent to 57) and Delta (+2 percent to 60) recently announced that they are going to merge.
“When it comes to mergers, combining two negatives doesn’t make a positive,” said Fornell. “Passenger satisfaction is dismal, and things probably won’t get any better if airlines continue to charge more for less.” ACSI reports gains for American Airlines and Southwest.
Among hotels, Marriott (-1 percent), Hyatt (+1 percent) and Hilton (+3 percent) are tied at the top of the industry at 78. Budget hotels such as Choice Hotels (Comfort Inn, Quality Inn, and Econo Lodge) and Best Western are at the other end of the scale, scoring 71 and 70 respectively. ACSI said the results underscore something that is more common than not: the strong impact of quality and the relatively weak effect of price on satisfaction. For information: www.theacsi.org.