Northwoods Commerce: Satisfy me!
Are you happy? Do you think your customers are? Would you know if they are not? Too often, the last person to know about an unsatisfied customer is the marketer of a product or service who finds out after his or her customer has left. There is a whole lot of consulting work being done to help companies measure and monitor whether their customers are happy or not. After all, as the old saying goes, if you can’t measure it, you can’t improve it.
If you engage in trying to tackle the issue of knowing how your customers feel about you and your products or services and how they compare you to your competitors, you can gain some very valuable insight or you might just as easily be fooled. Measuring customer satisfaction is not easy because most customers don’t speak up and few will voluntarily respond to questionnaires or satisfaction surveys. As few as two out of 100 customers may actually ever say anything to you about their experience. They will, however, tell from two to 20 of their friends about a bad experience.
For most dissatisfied customers, it is much easier to just walk away and move on than it is to make an effort to explain their dissatisfaction. Sometimes they just don’t want to make the effort, feeling it is not that big of a deal and that they can easily get their needs met somewhere else. Others may not want to hurt your feelings by telling you what they really think. I have seen situations where customer satisfaction surveys indicated that most customers were satisfied, but the business still suffered from a high percentage of customer attrition.
The lack of truth is why you need to be very careful of what people say. If you ask people how many hours of TV they watch per week, they will probably tell you a much lower number of hours than what they watch based on actual recorded time. Most people don’t think consciously about every purchase or experience and decide whether they were satisfied or not. Generally, satisfaction decisions are made subconsciously at a gut level, especially for more minor purchases. The most reliable vehicle for measuring customer satisfaction, then, really becomes what people do-not what they say.
If you do measure customer satisfaction, treat the results with some caution. Make sure you see similarities with the actions you observe or question the results you get. One way to cut through some of the issues is to test degrees of passion about your business. Recognize that you can’t please all of the people all of the time, but be concerned with the 20 percent of the people who make up 80 percent of your volume. Know these people well and ask how likely they are to recommend you to other customers and measure this factor over time. It is the evangelist who will help you grow your business. The simple act of asking helps show your concern and makes the statement that you care. Measuring movement of this metric over time helps you tell whether you are moving in the right direction or not.
Asking what you would need to do, or have to do, to get them to recommend you may also give you ideas for product improvements. The real key, however, is not what they say but what they do. Start with knowing what your ratio of new to exiting customers is and determine whether you are improving or moving behind on that metric over time. If you can interview customers who have left, try to find out why and what you might have done to have kept them as customers. Knowing what is happening with the beliefs, and more importantly, the actions of your most valued customers will help you acquire and maintain a more profitable customer base.
Scott Francis is president of Topline Development LLC, a strategic marketing consulting group that helps companies determine how they can make the most amount of money with the least amount of resources. To learn more about Topline Development LLC, visit their website at ToplineDevelopment.com or contact Scott directly at Scott@ToplineDevelopment.com.
Note: This article appeared in the April/May 2011 issue of Northwoods Commerce magazine.