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High-Tech Firms Cited for Open, Honest Online Policies But Poor Privacy, Responsiveness Traits in Fourth Quarter 2004 Online Customer Respect Study

November 29, 2004

More Than One-third of Surveyed Firms Still Share Personal Data With Third Parties Without Permission; More Than One-half Don’t Respond to All Inquiries

The Customer Respect Group, an international research and consulting firm that focuses on how corporations treat their customers online, today released the results of its Fourth Quarter 2004 Online Customer Respect Study of the largest computer products and services firms in the U.S.

Overall, eBay scored highest among Computer & Data Services companies, while Equifax scored lowest. Lexmark topped the Computer Peripherals list, while Symbol Technologies fared worst. Microsoft did best among Computer Software firms (and overall), while Siebel Systems did worst. Hewlett-Packard scored highest among Computer & Office Equipment suppliers, while NCR scored lowest. And Avnet topped the Electronics & Office Equipment Wholesalers list, while Brightpoint came in last.

The study is the only one to bring objective measure to the analysis of corporate performance from an online customer’s perspective. It assigns a Customer Respect Index (CRI(TM)) rating to each company on a scale of 0 to 10, with 10 being the highest achievable score. The Customer Respect Index is a qualitative and quantitative in-depth analysis and independent measure of a customer’s online experience when interacting with companies via the Internet.

By interviewing a representative sample of the adult Internet population, and by analyzing more than 1000 Web sites across a spectrum of industries in detail, The Customer Respect Group has determined the attributes that combine to create the entire online customer experience. These attributes have been grouped together and measured as indicators of Simplicity (ease of navigation), Responsiveness (quick and thorough responses to inquiries), Privacy (respects customer privacy), Attitude (customer-focus of site), Transparency (open and honest policies) and Principles (values and respects customer data). Combined they measure a company’s overall Customer Respect.

The Customer Respect Group continually enhances its methodology by expanding the list of attributes researched and reported on. Recently, the firm expanded that list to include respect for individuals with disabilities. In addition, this research was conducted based on the computer products and services-specific methodology introduced this past summer.

Summary Results/Comparisons

Although a direct comparison is difficult because of the inclusion of industry-specific questions, the overall Fortune 100 CRI average this past summer was 6.2, while the average score for this group of companies is 6.0. However this industry scored .8 points lower than the Fortune 100 group in the Responsiveness index, a surprising result from companies engaged in the high-tech field with a higher than average penetration of email usage among customers. The industry did score .5 points higher than the Fortune 100 group in both Transparency and Privacy, possibly as a result of increasing user concerns in these areas. While the average score for this industry, like most studied, was lowest in Responsiveness (a shocking 13 scored zero), it is unusual that Transparency scores top Simplicity as the best-tested attribute.

Among industry sectors, The Computers & Office Equipment group led the way with a 6.9 CRI, while the Electronic & Office Equipment Wholesalers trailed the group with 5.0. Software companies averaged 6.6, Computer & Data Services averaged 6.0 and the Computer Peripherals sector averaged 5.9.

Microsoft and Hewlett-Packard between them topped five of the six individual tables. Only IBM (www.ibm.com) interrupted this dominance with a table-topping performance in the Privacy index. No company received a score of 10.0 in any index.

The Online Privacy Protection Act of 2003, which was made law in California on July 1, 2004, has serious implications for any commercial Web sites without privacy policies that may have visitors from that state. Even so, three companies – Brightpoint, Graybar Electric and Safeguard Scientifics – do not provide privacy policies for their site visitors.

“These results provide much food for thought,” said Terry Golesworthy, president of The Customer Respect Group. “On one hand, we were pleased to see that privacy policies were generally clear, explicit and easy to read. This generally helps to allay concerns about what Web sites are doing with personal data. On the other hand, more than 50 percent of sites say they share personal data without users’ explicit permission. This should concern high-tech firms greatly, since research shows that more than half of Americans state that protecting personal information is their greatest concern when online. This concern, as the biggest single issue, jumps to fully two-thirds of Web users when they are considering making an online purchase. Clearly the practice of sharing data without permission will increasingly have a major impact on online revenue.”

The report conveys in great detail improvement opportunities for each company. The sector’s Fourth Quarter 2004 rankings are as follows: -0- *T Computer & Data Services CRI ———————————————————————- EBay www.ebay.com 7.6 Electronic Data Systems www.eds.com 7.4 Capgemini www.us.capgemini.com 7.2 EarthLink www.earthlink.net 7.2 Perot Systems www.perotsystems.com 7.2 Fiserv www.fiserv.com 6.7 Accenture www.accenture.com 6.5 VeriSign www.verisign.com 6.3 Affiliated Computer Services www.acs-inc.com 5.8 Unisys www.unisys.com 5.8 Agilsys www.agilysys.com 5.6 DST Systems www.dstsystems.com 5.6 Science Applications International www.saic.com 5.5 First Data www.fdms.com 5.2 SunGard Data Systems www.sungard.com 5.2 Dun & Bradstreet www.dnb.com 5.2 BearingPoint www.bearingpoint.com 5.1 Computer Sciences www.csc.com 5.1 IMS Health www.imshealth.com 5.0 Equifax www.equifax.com 4.9 ———————————————————————- Sector average 6.0 Computer Peripherals CRI ———————————————————————- Lexmark International www.lexmark.com 7.6 Storage Technology www.storagetek.com 5.7 EMC www.emc.com 5.6 Maxtor www.maxtor.com 5.5 Symbol Technologies www.symbol.com 5.2 ———————————————————————- Sector average 5.9 —– Computer Software CRI ———————————————————————- Microsoft www.microsoft.com 8.6 Symantec www.symantec.com 7.9 BMC Software www.bmc.com 7.3 Intuit www.intuit.com 7.1 Cadence Design Systems www.cadence.com 6.8 Compuware www.compuware.com 6.8 Veritas Software www.veritas.com 6.8 EA GAMES www.eagames.com 6.6 Adobe Systems www.adobe.com 6.5 Oracle www.oracle.com 6.4 Computer Associates Int. www.ca.com 5.9 McAfee Security www.mcafee.com 5.7 PeopleSoft www.peoplesoft.co 5.5 Siebel Systems www.siebel.com 4.1 ———————————————————————- Sector average 6.6 Computers & Office Equipment CRI ———————————————————————- Hewlett-Packard www.hp.com 8.5 Dell Computer www.dell.com 7.7 Xerox www.xerox.com 7.7 Gateway www.gateway.com 7.6 Pitney Bowes www.pb.com 7.4 IBM www.ibm.com 6.9 Sun Microsystems www.sun.com 6.8 Western Digital www.westerndigital.com 6.5 Apple Computer www.apple.com 5.4 NCR www.ncr.com 4.7 ———————————————————————- Sector average 6.9 Electronics and Office Equipment Wholesalers CRI ———————————————————————- Avnet www.avnet.com 6.8 CDW www.cdw.com 6.3 Anixter International www.anixter.com 6.2 Ikon Office Solutions www.ikon.com 6.2 Arrow Electronics www.arrow.com 5.8 Azerty www.azerty.com 5.7 Tech Data www.techdata.com 5.1 Insight Enterprises www.insight.com 4.9 Ingram Micro www.ingrammicro.com 4.8 CellStar www.cellstar.com 4.7 Bell Microproducts www.bellmicro.com 3.8 Graybar Electric www.graybar.com 3.6 Safeguard Scientifics www.safeguard.com 3.0 Brightpoint www.brightpoint.com 2.9 ———————————————————————- Sector average 5.0 *T

Other overall findings for all surveyed firms include the following:

— Surveyed firms receive the best overall rating (CRI: 7.3) for Transparency and the worst (CRI: 3.6) for Responsiveness.

— Some 20 percent of firms did not respond to any online inquiries.

— 31 percent of firms responded to half of the inquiries received. Of these, 67 percent responded within 24 hours.

— 49 percent responded to all inquiries. Of these, 24 percent responded within an hour and nine percent responded more than four days later.

— Some 31 percent of all sector firms use Autoresponder technology, in which emails are automatically sent to users to confirm the receipt of their inquiry and let them know when they should expect a response. Of these, 50 percent included detail on how quickly they would follow up and 56 percent followed up in the timeframe promised.

— Some 76 percent of companies provide email forms for online inquiries, 18 percent provide email addresses and six percent provided no online contacts.

— 95 percent of sector firms have privacy policies on their sites explaining how customers’ personal data is being used. Of those that do, 11 percent need to be more explicit about how they use personal data, 52 percent do not collect data or use collected data only for internal purposes, 15 percent share data with affiliates or subsidiaries and 22 percent share data with business partners without permission from users.

— Some 90 of surveyed firms use cookie technology. Of these, 21 percent provide a full explanation about what advantage they provide the user and what data they hold, while 18 percent provide a full explanation on how to disable them.

— Only five percent of companies provide forms that can be easily used by those with disabilities.

How to Order

Each company and industry is researched and analyzed twice annually. Subscribers to Customer Respect Online receive:

— Industry-specific key findings, analysis and editorials for one-or-more subscribed industry reports

— Dynamic league tables for CRI and each CRI sub-index scoring for all companies

— CRI report cards for each company covered in that report

— Detailed own-company confidential report including actionable recommendations

— Best practice guidelines, practical customer respect examples

— Analysis tools for head-to-head and multi-company comparisons with drill-down to sub-indices and individual criteria detail

— Annual Fortune 100 CRI Report (annual subscribers only)

Companies can obtain additional information by visiting the Web site, www.CustomerRespect.com, calling 617 378 3173 or emailing info@customerrespect.com.

About The Customer Respect Group

The Customer Respect Group is an international research and consulting firm that uses its Customer Respect Index (CRI(TM)) methodology to help companies improve how they treat their customers online. It provides leadership in the objective and scientific measurement of a customer’s online experience. Many of the largest U.S. companies have already adopted the CRI methodology to improve online customer satisfaction and loyalty. The Customer Respect Group is headquartered in Boston. For additional information, visit www.customerrespect.com.

All companies and products listed herein are trademarks or registered trademarks of their respective holders.




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