Every company and organization should be very clear on the meaning of “customer satisfaction”, simply because it’s paramount to the success of any business. Customer satisfaction is a marketing term for measuring how products and/or services meet and sometimes surpass a customer’s expectations, and it provides business owners and marketers with a metric they can use to improve their business.
Customer satisfaction is so important that, when it’s done properly, customers typically forget about price, because being acknowledged and treated like a VIP is all any customer really wants when buying products or services. Different businesses have different ways of excelling at customer service, but the end result is always the same – the customer feels acknowledged and listened to, and they know they’re a very important part of your business. It follows, therefore, that successful customer satisfaction programs pay off for businesses because they bring in more revenue.
Social Media – Good or Bad?
We know that today’s technologically-savvy buyers are eager to share their opinions on social media, which can be either good or bad for business. Good, if the reviews show that the shopper felt appreciated and respected both during and following the purchase of a product or service from your business; or bad, if the shopper has posted a scathing review after enduring a negative experience while either purchasing, attempting to purchase a product or service, or trying to return a product.
Negative reviews are extremely damaging to any business because, as we know, bad news travels fast and people are more inclined to remember the negatives for a longer period of time. It can also be extremely difficult and time-consuming for a business to recover from a series of negative reviews.
An added bonus for businesses who consistently provide a great customer experience is that very little marketing or sales are required to get both new and old customers through the door. In fact, your best salespeople can be your happy and loyal customers, and that’s a fact just too important to ignore.
What Is Customer Satisfaction, and How Is It Measured?
Customer satisfaction is vitally important to the success of any business, and it’s certainly more than offering a money-back guarantee (although that can be an important part of a successful customer satisfaction program). Successful businesses use customer satisfaction to measure the degree by which their customers are happy with a service, product, or experience. It’s simply good business sense to understand that maintaining your current customers is a lot less expensive than trying to acquire new ones, which means that customer satisfaction is vitally important to the bottom line of any business.
Customer satisfaction reflects how customers feel about interacting with your brand, and this positive or negative feeling is quantified by businesses and brands using surveys. For example, the five-point Likert Scale and the Net Promoter Score (NPS) surveys can provide your business with a good sense of customer satisfaction and customer loyalty, also predicting the likelihood of customer referrals; all vitally important information for any business!
Why It’s Important to Measure Customer Satisfaction
If you have no way of measuring customer satisfaction, then you have no way of identifying unsatisfied customers. This means that you have no way of analysing customer’s feedback, knowing what changes you should make to your service or product to keep your customers happy, and you have no way of either predicting or preventing customer churn.
What Is Customer Churn?
Customer churn can be defined by the number or percentage of customers that stopped using your company’s service or products over a set period of time. This figure is usually calculated by determining the number of customers you lost in a specific quarter and dividing that number into the number of customers you had at the beginning of the quarter. For example, let’s say your quarter started with 200 customers and you lost 20: your churn rate is therefore 10%.
Customer Success Translates to Company Success
Measuring customer satisfaction is very important to any business because you need to know who your happy customers are and why they’re enjoying success with your service or product. Prioritising customer success translates to improving company success, so if you’re not doing this it’s highly likely your business isn’t growing.
Today’s growing companies are discovering just how important it is to prioritise customer success, and they’re identifying and activating successful customers by requesting feedback. It’s in this way that they’re able to identify satisfied customers; these are your happy and loyal customers who not only share their great customer service stories with family and friends, they also bring new customers through your doors without any sales or marketing on your part, and no cost of customer acquisition.
As any business knows, it’s much cheaper to retain existing customers than it is to find new ones, but more importantly, repeat customers and referred customers spend more. You simply can’t ignore just how important customer satisfaction is to the success of your business!