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Tuesday, August 7, 2007Other Dates

Websites/phone numbers mentioned:

Zappos.com - An online clothing retailer
BlueNile.com - The largest online retailer of certified diamonds
RedFin.com - An online brokerage for residential real estate
myFICO.com - Used by lenders to assess your credit risk

Today's topics are "Best Of Clark" repeats from recent shows

Airlines get lower satisfaction score than IRS

The customer satisfaction index distributed quarterly by the University of Michigan is out again. This quarter, the survey ranked airlines, cell phone companies, cable and others. The results are amusing. Would you believe that the typical American airline got a lower score than the IRS? We really dislike the airlines. As you might have guessed, Southwest ranked the highest in the airline survey while United ranked lowest. In fact, United received the second lowest score of any airline in the 14-year history of the survey. Only Northwest Airlines got a lower score in 1999. In chain restaurants, Olive Garden got the top rating. The top-rated hotel was Marriott, followed by Hyatt and Hilton. As for cable and television, DirecTV and Dish got the highest scores. Charter Communications and Comcast ranked lowest. In the cell phone industry, Sprint got the worst score. Verizon and T-Mobile were tops. As for package delivery, FedEx got the best score. UPS and the USPS got fairly high rankings, as well. But FedEx has been on top for 10 years.

Great customer service helps sales

For the first time ever, people are buying more clothing than electronics. One of the most customer-friendly and popular sites is Zappos.com. They offer shoes, accessories and other apparel and there is no shipping -- even if you're returning. They have a one-year return policy, which is unheard of in the shoe industry. Online clothing retailers have electronic sizing on their sites nowadays, so the potential for correct fitting is much better. Another popular site is Blue Nile, which is outselling Tiffany's in engagement rings. Both of these companies keep the focus on the customer and that is why they've been so successful. Other companies should take a hint and try it.

Consumers lose with mandatory arbitration

Clark used to be a big fan of arbitration. But over the years, he's completely changed his opinion, especially in the case of mandatory arbitration. Mandatory arbitration is something big corporations now cram down the throat of customers. Basically, they're saying that if you're going to do business with us, you must go through our arbitration system if you have a dispute. But that system is always stacked in favor of the company and against the consumer. One example of this is going on in the stock brokerage business with full-commissioned brokers. Statistics show that people who enter into arbitration with either Merrill Lynch, Morgan Stanley or Smith Barney will get only 10 percent of their money back. Consumers win "partial money" 4 out of 10 times. The good news is that now there is a move in Congress to outlaw mandatory arbitration. With voluntary arbitration, the companies would have a reason to make the process fairer. The best advice is to never do business with a full-commissioned stock broker.

Discount real estate services growing

Real estate agents are terrified these days. The Internet -- and the discount websites that have succeeded on it -- has decimated the industry. And, now it's a civil war that pits agent against agent. Traditional agents want to keep commissions fixed. Some have even tried to get legislatures to pass price-fixing laws. Other agents realize that the marketplace is going to win out so they're offering full service and lower commissions. There are also several great sites offering a menu of services based on how much help you want. A new example Clark just learned about is the site RedFin.com. There is a very limited menu and it's only available in certain areas, but word about this company is spreading like wildfire. One controversial area of the site is the review area, where people who've looked at houses can then rate them. The company is in a lawsuit right now over these postings and has taken them down for now. But people crave that kind of knowledge and the idea of a more open market.

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Do you like the idea of auto insurers switching to a pay-as-you-drive model -- where how, when and where you drive may be monitored?
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