Private Label Helps Boost Retail Customer Satisfaction Scores
Consumer satisfaction with U.S. retailers is up 4% as issues stemming from the pandemic along with cooling price increases are cited as key drivers for the growth, according to new figures in the American Customer Satisfaction Index (ASCI).
In the Retail and Consumer Shopping Study 2023-2024, more than 60% of retailers measured saw their individual ACSI scores improve in 2024.
“For industries like supermarkets and gas stations, moderating inflation is helping to improve the value proposition,” said Forrest Morgeson, assistant professor of Marketing at Michigan State University and director of Research Emeritus at the ACSI. “And leading up to the holiday season, consumers looking to stretch their dollars responded positively to discounters and retailers that excelled in sales and promotions or pumped more value into the experience through private label offerings.”
Customer satisfaction with general merchandise retailers were up 3% to an ACSI score of 77.
Macy’s (up 4%) and Costco (unchanged) top general merchandise retailers with ACSI scores of 82. The department store is viewed as helping shoppers get more bang for their buck with better sales and promotions and greater value.
At Costco, its private label Kirkland Signature is cited in the report as a key reason shoppers visit the warehouse club. In fact, the Kirkland brand is seen as “cool” given the number of TikTok and Instagram accounts dedicated to highlighting products from the retailer’s own brand.
Private label success is cited in the report as a key factor in the high rating received at Sam’s Club. Its ASCI score held steady at 81, but the report noted a “gravitational pull” toward Sam’s Member's Mark private label, which now accounts for 30% of its total sales.
Other notable mass merchandisers receiving strong scores are BJ’s Wholesale Club (80), Belk (79) and Big Lots (78), with the latter two climbing 5% and 7%, respectively. Walmart (up 4% to 73) and Dollar General (up 3% to 72) also made gains.
In the grocery segment, Costco (up 4%), H-E-B (up 5%), and Publix (up 4%) share a three-way tie atop the industry at 85, upending Trader Joe’s multi-year winning streak. The former leader is next with a steady ACSI score of 84.
Publix sets the standard across much of the in-store experience, including staff courtesy and store cleanliness and layout, while Costco and H-E-B win on value. All three benefit greatly from the popularity of their private label brands.
Sam’s Club (Walmart), just off the leaders, climbs 5% to 83. Meijer and ShopRite experienced the biggest gains, each improving 7% to 80. Meanwhile, Walmart, despite improving 4%, finishes last with an ACSI score of 74.
Unlike its performance among general merchandise retailers or supermarkets, Walmart shines in the drugstore industry. The company’s pharmacy business surges 11%, putting the retail giant in first place along with the smaller drugstores (up 3%) at 82. The retailer’s satisfaction gain is supported by industry-leading value and strong ratings for key factors such as merchandise variety and pharmacy services.
There is little differentiation in customer satisfaction among standalone chains Rite Aid, Walgreens, and CVS, with scores nearly stable compared to a year ago. Rite Aid improves 1% to 76, Walgreens is unchanged at 75, and CVS dips 1% to 74.
Within the specialty retail segment, ACSI newcomer Tractor Supply Company and Ace Hardware (up 3%) outperform fellow hardware and home improvement stores at 82, while Pet Supplies Plus debuts with the same score thanks to its value proposition and best-in-class sales and promotions.
O’Reilly Auto Parts scores an 82 following a 5% surge at a time when rising used car prices are prompting drivers to keep their cars longer.
American Eagle Outfitters (down 2%), Menards (up 1%), and Apple Store (unchanged) each score 81. Six brands sit at 80: Home Depot (up 3%), Hobby Lobby (down 1%), Bath & Body Works (down 2%), Sephora (up 3%), Ulta Beauty (down 1%), and PetSmart (unchanged).
ODP (Office Depot, OfficeMax) drops 1% to 75, yet still outperforms last place GameStop, unchanged at 74.
