US consumers hard to please

20 October 2010

NEW YORK: Consumer satisfaction with product categories such as soft drinks and household goods has declined in the US during the last year, a survey has revealed.

The American Customer Satisfaction Index, a regular poll of shopper perceptions regarding both specific manufacturers and entire markets, reported that attitudes had changed since 2009.

Ratings of the soft drinks sector fell 1.2% to 84 points, with Dr Pepper Snapple leading the way for the fifth consecutive year despite registering a 1% contraction.

The company recently signed a deal meaning Coca-Cola will directly distribute its Dr Pepper brand in the US, after Coke formally took control of its previously independent bottling arm.

"These agreements solidify Coke's support of the Dr Pepper trademark and the continued growth of both the brand and our flavor portfolio," said Larry Young, president/ceo, Dr Pepper Snapple.

"Moreover, it increases the brand's presence on fountain, providing additional opportunities for millions of consumers to sample the brand each and every day."

Elsewhere on ASCI's index, Pepsi dropped 2% to 84 points, the same level as Coca-Cola, while smaller rivals and private label decreased 7% to 79 points.

The beer segment, on 82 points, generated a 2.4% slide having attained a new high in the last such study, with Anheuser-Busch losing 4% to 82 points, also following on from a record total in 2009.

Sales of Budweiser are thought to have tumbled by almost 10% annually, as younger drinkers gravitated towards "microbrews" and lower calorie options.

"Notwithstanding our international successes with Budweiser, we are not pleased with our overall market share performance," A-B InBev said in an August earnings release.

"We are putting in place brand building and commercial programs to improve our performance in the second half of 2010 and into 2011."

Miller, static on 83 points, thus hit the top spot in this sector, and Molson Coors retained third having achieved 81 points.

Personal care and cleaning experienced a first decline in three years, slipping 2.4% to 83 points, although Colgate-Palmolive was up 2%, reaching 85 points, and Unilever maintained its 87 point score.

However, Clorox's figures fell 2% to 86 points, Dial was off 1% on 83 points, and Procter & Gamble decreased 4%, receiving its lowest marks - 82 points - since 2004.

"In the midst of the weakened economy and lower customer satisfaction, some consumers have abandoned P&G products in favor of lower-priced alternatives," said Claes Fornell, founder of the ACSI.

"If they find these alternatives satisfactory, it will be difficult for P&G to win customers back without offering price discounts."

Looking to the tobacco industry, tax rises had resulted in a negative shift in 2009, but this segment enjoyed a 5.6% uptick during the latest research round, hitting 76 points.

Philip Morris, on 77 points, witnessed a 7% leap, Reynolds American improved 4% to 75 points and the collective score of more minor brands also climbed 6%, obtaining the same total.

"Sales taxes and higher prices typically have a dampening effect on tobacco demand, but not this time," said Fornell.

"With recent data showing overall consumption largely flat over the past two years, consumers seem to be shrugging off the tax increase and adjusting both expectations and budgets to accommodate the higher prices."

Data sourced from American Customer Satisfaction Index; additional content by Warc staff