Progressive and Farmers Make Customer Service Hall of Shame

Companies say they want to delight their customers. And they should: Happy customers make for repeat sales, bright bottom lines and, ultimately, satisfied shareholders.

But some of America’s biggest and most influential companies seem to leave their customers feeling slighted, not delighted.

In MSN Money’s fifth annual survey of customer service, conducted with pollster Zogby International, four of the 10 worst-ranked companies — those that make up our 2011 Hall of Shame — are financial institutions. Cable, insurance and other service providers round out the list.

So are there common problems? Many of the companies in this year’s Hall of Shame have become synonymous with “gotcha” fees and surprise rate hikes, with bungled loan modifications and lost paperwork, or, simply, with downright complicated service.

“Customers are very distrustful of companies that they feel are trying to exploit or take advantage of them,” said Michael Shames, the executive director of the Utility Consumers’ Action Network, a consumer-advocacy nonprofit. “And a lot of these companies really do make their money from customers not fully understanding the nature of the service being offered or their rights.”

As a group, the lowest-ranked companies generally also tend to reward their top executives handsomely, even while making cutbacks.

The median compensation in 2010 for the CEOs of these 10 companies exceeded $14.9 million, or 447 times the median American worker’s pay of $33,190, according to the AFL-CIO Executive PayWatch project.

By contrast, the median compensation for CEOs of the public companies in our Hall of Fame — the 10 companies in our survey with the best marks for customer service — was a little over $3 million.

In response to past surveys, many companies blamed the products they sell or services they offer as inherently frustrating. But a bank can be liked. This year, USAA, which serves military families, was rated “excellent” by 62% of respondents for its customer service (although sadly, it didn’t make our Hall of Fame because not enough of our survey respondents knew it well). State Farm and T-Mobile also got good marks despite the low marks earned by many of their industry competitors.

Below are the 10 companies in our 2011 Customer Service Hall of Shame.

10. Farmer’s Insurance
9. JPMorgan Chase
8. Progressive Insurance
7. CitiGroup
6. Comcast
5. Time Warner
4. Sprint
3. Capital One
2. AOL
1. Bank of America

By Karen Aho

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