Marketing Series Article The Quest for Customer Satisfaction First...do we know what we’re even looking for? by Dick Barnes, Principal, The Freeland Group Nowadays it seems everyone is talking about how important their customers are, how well they treat their customers, and how their customers are loyal because they are satisfied. But how do we know if our customers are satisfied, super satisfied, truly loyal, or just hanging with us until someone better walks in the door? In truth we really don’t know, nor do we even consider dividing customers into these different camps. If we want to improve our bottom line, we need to know what our customers really think, and we need to pinpoint what we do that does satisfy them and what does not. Better yet, we should want to discover what they consider just satisfactory, what they are happy about, what they’re delighted or thrilled about, and what they simply tolerate until something better comes along. Until recently, most firms simply lumped all customer attitudes into satisfied or unsatisfied. This black and white approach did little to help us find ways to improve service and customer retention…and customer retention is vitally important to our profit line. Measuring and qualifying customer satisfaction issues can be extremely instructive if we know what to look for and what to do with that information. To begin the process of measuring customer satisfaction we should first define what we are looking for. Customer satisfaction is normally thought of as the relationship between what the customer expects and what the customer receives; in other words, expectations versus performance. More accurately, we should label it perceived performance, as what we actually do is sometimes under-appreciated or unseen by a critical customer. Usually we help set up these expectations, through advertising or through the sales process. When this happens, and we don’t deliver, we have no one but ourselves to blame. Over-promising, then delivering less than promised, is a surefire way to create customer dissatisfaction. This can be true even if our performance is still better than that of our competitors. The fact that the customer believed something different colors the picture against us. On the other hand, when the customer gets more than they bargained for they think we’re the greatest. They are completely satisfied, even thrilled. The down side, of course, is that when they reorder they do so with newly heightened expectations. If we perform as before, they are simply satisfied, but if we don’t over-perform once again, they become dissatisfied. It’s like walking a tightrope. And it’s a very shaky tightrope. We want to sell ourselves and our firms, but we don’t dare oversell, but if we sell too little a competitor may beat us out, and if we promise just enough to beat the competition then we don’t dare fail to deliver. Recall the “snake oil” salesmen of old. They would sell cough syrup out of their horse drawn wagons, claiming the elixir would cure every disease of mankind. When the product did not deliver, the salesman was often tarred, feathered, and run out of town on a rail. They created very unsatisfied customers. This wouldn’t have happened if the salesman had simply promised to sooth a cough. He wouldn’t have sold as much product, but he would have enjoyed his leave-taking a great deal more. All of this doesn’t mean the modern day customer relationship is so complicated as to be hopeless. After all, your competition is in the same boat and your customers are probably in there as well; being that they also have customers to worry about. So even your most finicky consumers have some degree of tolerance and understanding when things don’t go exactly as planned. In the modern business transaction, there are a number of areas we can look at to help us measure overall customer satisfaction. Generally we look at the product or service itself, its price, the delivery, the billing and collecting process, the ordering or re-ordering process, the personal relationships involved, and the customer service after the transaction. Your firm might have a different selection of functions or processes that could be measured as well. Next we look at ways to measure the level of satisfaction with those functions. There are four proven methods to go about this; the lost customer analysis method, the test shopping analysis, a complaint analysis, or a customer satisfaction survey. Different functions are sometimes better analyzed by different methods, or combinations of these methods. The lost customer analysis can be a very simple thing. A manager might make a telephone call or personal visit, or a third party might do the calling to help prevent bias. Sometimes the information gained can actually get your salesperson back in the door at a later date, but the real intent of this practice is to be able to build a list of events that created dissatisfaction. Test shopping is the practice of using a third party to pose as a prospect. They can then report in great detail what happens throughout the process. They can even go as far as making a purchase, then returning the purchase for a refund or requesting customer support after delivery. Every firm should run this type of trial at least once, if not on a regular basis. Complaint analysis is similar to the lost customer analysis, but you don’t have to hunt down the problems encountered by customers. They are kind enough to make sure you know what the problems are. I state it that way because a complaining customer should be considered a gift. It's an opportunity to see your weaknesses from another’s viewpoint and to come up with solutions. If you are not tracking and graphing complaints you are missing vital information that could generate some healthy returns. A customer satisfaction survey might be the most expensive and time-consuming method of the four. It might also be the most accurate. Studies indicate that only five to ten percent of dissatisfied customers will make a complaint, or leave you immediately for a competitor. In other words, ninety percent of your customers might be unsatisfied and just waiting for the right salesperson to walk in the door and steal them away. There is an obvious value in finding the hole in the fence and fixing it before the critters escape. A survey may allow you to do this, and stop those customers from becoming ex-customers. Customer satisfaction surveys should normally be designed and carried out by a third party, and might be done blindly so as not to unduly influence results either pro or con. An important aspect of any of these measuring systems is to keep track of results and compare them over time. Without doing so we can never discover whether we have made improvements or not. In the same vein, the method of gathering information must be the same each time, or the results could be misleading. Next month we’ll get into some different methods of tracking the information we gather, organizing that information, then using it to enhance our customer satisfaction measures along with our bottom line. (next article in series) |
