Why Measure Customer Satisfaction?
To answer this question, you need to get back to basics and think about what’s most important to your business. And this begins with your customers.
Essentially your customers are everything, because without them you wouldn’t have a business. However, even if you have plenty of customers that doesn’t automatically guarantee your success. This is because if your competitors’ customers are happier and more engaged, they’re likely to be selling more products and services to them as a result.
That’s why it’s important to measure how happy your customers are and how well you’re fulfilling their expectations and needs. Only then will you know how well you’re doing. You’ll also know what to improve, if you’re to make your customers as satisfied as they possibly can be.
When does customer satisfaction occur?
As part of the customer satisfaction measurement process, you need to think about how often the issue of customer satisfaction is likely to occur.
Well, the short answer is that’s it’s pretty much an ongoing process. This is because customer satisfaction applies to every customer interaction with your company – before, after and during a sale.
A good way to visualise this is to consider all the touchpoints a typical customer has on their journey with you. This can include anything from their initial research on your company website and a subsequent chat with one of your salespeople, to making an online payment and then interacting with your support team following a product purchase.
There can be quite a few touchpoints in this process. And if a customer is not totally satisfied with each interaction, they can easily decide to take their business elsewhere.
Five reasons customer satisfaction is important
While it may be surprising to know how many times you’ll test a customer’s satisfaction with your business, you also need to explore in more detail the reasons why customer satisfaction and improving it are so important.
It’s more cost effective to retain than acquire new customers
Considering that the cost of acquiring a new customer can be up to five times more than retaining an existing one, it makes good business sense to keep your customers as happy as you can.
The benefit of customer retention is brought even more clearly into focus when you think about their lifetime value. The more that a customer returns and buys from you, the greater that customer’s lifetime value.
Helps reduce customer churn
The flip side of retaining more customers is reducing churn when customers suddenly stop buying from you.
Customer churn can be extremely costly, because you need to spend more time and money on acquiring new customers.
So, it’ far more efficient to keep your customer satisfaction levels as high as you can make them. Loyal and long-term customers not only buy more, but don’t cost as much to your business as acquiring new customers.
It’s easier to maintain brand positivity
To maintain your reputation and brand positivity, you must keep complaints and negative comments about your business to a minimum. This is even more important in today’s digital age, as bad news travels fast.
Improving customer satisfaction helps reduce the likelihood of complaints and negative comments. It also increases positive actions including recommendations about you from satisfied customers to their family and friends.
It helps you identify areas where you need to improve
Knowing which areas you need to improve is often more important than knowing what you’re doing well.
The reason for this is if you’re blinding moving forward without any consideration for customer satisfaction, you risk not picking up on those areas you need to improve. And if they continue to worsen, that poses long terms risks for your reputation and brand.
Every business wants to increase revenue and grow, but they may not always have the resources to actively do this. However, once your customer satisfaction is moving in the right direction, this becomes an indirect and effective way of growing your business and revenue.
Satisfied customers keep returning to buy from you and recommend you to their peers. This should keep a steady and, hopefully increasing revenue stream coming in without you having to constantly work on it. But of course, you still need to maintain high levels of customer satisfaction to make this happen.
How is customer satisfaction achieved?
Customer satisfaction is an indicator of your service quality. So, if customers are dissatisfied, it’s probably because you’re not meeting their needs.
Fortunately, there are some steps you can take to take to improve it.
Better understand your customers’ needs
Customer satisfaction is achievable when you can really understand their needs.
While some customers may experience different issues, others worse still may face the same old problems again and again. So, you need to have an ear open to satisfied customers and an eye on dissatisfied customers and be able to quickly respond and resolve their needs.
If you can do this, your customers will be more likely to return having gained your trust.
Exceed your customers’ expectations
Whether it’s providing more value or service than that which you initially agreed on or delivering on a promise much earlier than expected. It stands to reason that if you can consistently exceed your customers’ expectations, your customers will be happy.
Help your customers to help themselves
An increasingly effective customer service strategy for companies is to anticipate customer questions and provide answers to them. You can achieve this with a Frequently Asked Questions (FAQ) page, offering answers to frequent customer queries and issues.
Having an FAQs page is prudent when you consider a customer may be less likely to repurchase if they can’t find quick and clear answers to any queries or concerns that they may have.
Employ the right people in your customer service and support teams
As the voice of your business, your customer service and support teams are critical to the care your customers receive. To keep them happy, it’s essential that they can always deliver a great service and remain calm and professional even when dealing with the most difficult or unreasonable customers.
Therefore, it’s sensible to only consider the most professional, even-tempered, and people-orientated individuals for these key roles.
Fix recurring problems
Given that less than 1 in 25 customers express their dissatisfaction with a business and instead readily tell others of any unpleasant experience they’ve had with a product or service, it makes sense to address customer issues quickly. To make matters worse this dissatisfaction is exacerbated further if customers have to complain about a frequently occurring issue.
It’s therefore prudent to be vigilant in identifying and fixing any recurring problems your customers are experiencing. If you can do this, you’ll reduce the burden on your support teams. You’ll also begin to make real inroads into improving your customer’s experience.
Clearly define your customer service policy
Finally, if you’re to deal with customer issues effectively and efficiently, it helps to have a clearly defined customer service policy. This is because not every customer issue is the same, and you might need different processes, people and departments involved to resolve it.
Just consider some of you own experiences with a company’s support team, such as being passed from person to person, or not knowing from the outset who you need to speak to. It can be annoying and if it happens enough, may result in you taking your business elsewhere.
Fortunately, with a dedicated customer service policy document in place you’re much less likely to deliver this experience for your own customers, as you’ll have clearly defined guidelines in place for dealing with different customer issues. Besides your staff, you could also make this document available for your customers to use at the time of purchase. This would help your customer to feel more welcomed, wanted and valued. It would also provide clarity about who they needed to contact if they required support.
The CSAT metric
Having discussed why customer satisfaction is important and how to achieve it, we need to explore how to measure it. Doing this can help you gauge how well you’re doing and by how much you need to improve.
When it comes to measuring customer happiness, the customer satisfaction or CSAT metric as it’s otherwise known, is one of the most effective ways.
It aims to measure a customer’s satisfaction with a product, service or support interaction via a satisfaction survey and a question that asks your customers – ‘How satisfied were you with our (product, service, support interaction)?
Each customer is then invited to rate their experience using a 5-point scale from very dissatisfied to very satisfied.
You can calculate your CSAT by dividing all the positive responses you receive by the total number of responses and then multiplying this figure by 100. This gives you a CSAT percentage.
Scores closest to 100% indicate the highest levels of satisfaction, while those at the other end of the spectrum the lowest satisfaction levels.
Faster and more effective ways of calculating CSAT are also becoming more widely available. Our CSAT calculator is a good example.
Why use surveys to measure satisfaction?
From customer retention and churn rates to live chat applications, review sites, customer comments on social media and more. As we’ve just outlined, in addition to CSAT, there are other options for measuring customer satisfaction, that will give you a quick feel for how happy customers are with your business. However, online surveys and customer experience survey metrics such as NPS score, CES and CSAT that you can use alongside them offer by far the best approach.
Quickly gain valuable insights
Traditionally Net Promoter Score (NPS), is viewed as one of the most effective ways to assess customer satisfaction, by gauging a customer’s loyalty to a business. It’s based on the idea that individuals most satisfied with your product or service would give you a high NPS score. This would also make them more likely to recommend your company to others. However, with the growth of customer touchpoints, more customer experience metrics were introduced to provide a more accurate picture.
Survey metrics are useful as they’re easy to answer, quick for you to analyse and enable you to get a better feel about your customers’ feelings.
Typically used alongside NPS and CSAT is the Customer Effort (CES) metric. Essentially CES is a service metric that measures how much effort it takes customers to interact with your business. Interactions can be defined as the effort it takes to use your product or service, or get problems resolved. It’s based on the following question which asks customers – How easy was it to do X, Y, or Z?
Each customer is then invited to rate their experience using a 5-point scale from very difficult to very easy. Once calculated it’s simple to see how easy or not you’re making it for customers to interact with you. You can then take any actions you need to make your customer interactions as simple as they can be.
Provides more detail about what customers are happy or not happy with
Unlike other methods of measuring customer satisfaction, the flexibility of surveys helps provide a more detailed picture of your customers’ likes and dislikes.
You can construct surveys using a wide variety of closed ended question types alongside open ended ones. Not only does this help to boost engagement with respondents, but it enables you to explore all the areas of your business that your customers interact with. You can then use open ended questions when you need to get more detail about specific customer experiences.
Benchmark your progress
Issuing the same survey at frequent and consistent intervals, helps provide an ongoing insight into the satisfaction of your customers.
If you use the same questions, you can compare data over time, benchmarking it against earlier periods. From here you’ll be able to see how well you’re progressing and what changes you need to make to further improve customer satisfaction.
Demonstrate how much you care
Every customer likes to feel valued by the company they’re interacting with. So, the best way to achieve this is to ask them for their feedback.
If you regularly survey customers for feedback, they’ll feel more included and confident of your commitment and ability to make future decisions based on their feedback.
Popular customer satisfaction survey questions
Having explored the benefits and taken the decision to run a customer satisfaction survey, it’s useful to have some sample questions to draw on.
Here’s a few questions to help get you started.
“How satisfied were you with the customer service experience you received from us today?”
Given the importance of a company’s support team in determining customer satisfaction, this question is a valuable way of assessing the ongoing levels satisfaction among your customers as they interact with your support team.
“If you are less than totally satisfied, what could we do to serve you better?”
While we hope you have plenty of happy customers, many businesses will have some customers who may not be happy about a particular aspect of their service.
Subsequently, this can be a useful question to have in your armoury. It gives your customer the chance to offer suggestions about how you might improve. And the value of this is that sometimes they can come up with suggestions you might never have thought about.
“How satisfied are you with our products/services?”
Sometimes it’s useful to run with a more general question such as the above.
This question is helpful by getting customers to think about their whole experience with your business, not just one interaction. So, whether good or bad, you could end up with feedback on anything from a product feature to a customer’s experience of your website or an interaction with a sales rep.
“In relation to your most recent purchase, how did you contact us?”
Your ability to meet your customers’ behaviours and preferences will have significant bearing on their satisfaction levels. A question similar to the above can help you explore these behaviours and improve how well you meet their needs.
“How quickly did you get through to our support or sales teams?”
Besides customer behaviour and preferences, it’s useful to gain some hard and fast data about the speed of your operations, as this can also influence customer satisfaction.
One of the most common bug bears for customers concerns how quickly they’re able to speak to you. And this becomes even more important the larger your customer support or sales team. With the above question you can gain a better idea about your call response times and identify what needs improving.