Vanguard Group, famed
for its low-cost investment products, just broke out of the pack in a consumer
satisfaction survey. But not in a good way.
The mutual fund firm
with more than $5.3 trillion in assets under management suffered the largest
annual point decline among internet investment providers in an American
Customer Satisfaction Index report. The Malvern, Pennsylvania-based company’s
score dropped to 79 out of 100, down three points from last year and knocking
it out of first place. The new leader is Edward Jones & Co., which scored
doesn’t have brick-and-mortar branches, has had some high-profile glitches in
the past year. On Oct. 10 — after the survey was taken — when the S&P 500
Index had its worst decline in nine months, some customers were unable to
access Vanguard’s website.
The fund giant’s score
of 79 matches the overall rating for its sector, and that of Fidelity
“Digital is awesome
when it works, but if it doesn’t, it’s human nature to react even more strongly
in a negative fashion,” said David VanAmburg, managing director at the ACSI.
“Vanguard got low marks for customer service. It just wasn’t seen as a strong
point for them.”
A Vanguard spokeswoman
said the firm is “investing considerably in improving our customer service and
experience.” Along with enhancements to online security and its mobile app over
the years, “in early November we completed a major systems upgrade to improve
the resiliency and performance of our websites,” she said.
The ACSI report, which
focused on the financial and insurance sectors, also showed that banks are
closing in on credit unions after trailing in customer satisfaction for a
decade. The two industries had the same average score of 81, with credit union
scores dropping by 1.2 percent from a year earlier. As bank digital offerings
evolve and mobile banking takes off, the personal touch credit unions
historically provided may not be as important, VanAmburg said.
Wells Fargo & Co.,
which has been grappling with a string of consumer scandals, was the
lowest-ranked national bank with a score of 74, while JPMorgan Chase & Co.
was first with an 80, according to the report.
The ASCI Finance and
Insurance Report 2018 is based on interviews with 25,555 customers, chosen at
random and surveyed between Oct. 2, 2017, and Sept. 26, 2018.
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