Why do we need to measure customer satisfaction?

Some statistics suggest that it costs 10 times more to win a new customer than retain an existing one. Furthermore, satisfied customers are more likely to be repeat purchasers, heavy buyers of our product and hopefully ambassadors of our brand.

Whilst smaller companies often hear directly from the ’horse’s mouth’ how they are performing, larger companies need a more structured and formal approach to assess customer satisfaction.

So, what are the major elements to be considered when designing a customer satisfaction survey?

They are
1. Who do we talk to?
2. What attributes do we measure?
3. Which methodology do we use?
4. How do we measure satisfaction?
5. How do we use customer satisfaction surveys to its greatest effect?

Who to talk to?
This might seem obvious in the case of some products, but, when parents buy products and children are the main consumers such as breakfast cereals or savoury snacks, then, should we interview the consumer or the purchaser?

In some business sectors, it may be a choice between the procurement department (the buyer) and the end user such as the marketing department.
Ideally we would want to talk to all individuals in the decision making process but in reality there may have to be a compromise. Do we focus on the marketing department (in the business example) and the parent (in the case of purchasing for children)?

Remember as well, that customer satisfaction surveys are just that, they do not take account or potential or lapsed customers views which may be equally insightful.

What attributes to be measured? We need to evaluate how the company is performing and where it can improve but this can be measured on a variety of levels. On a macro level the key questions are often

• Overall satisfaction
• Likelihood to repeat the purchase
• Likelihood to recommend to others ( ambassadorship)

But it is at the more specific micro level of questioning that things become more complicated. There are basic hygiene factors that all companies are expected to deliver (if not they would fail to continue operating) but beyond that other issues can differentiate you from your competitor and therefore add value to your product or service. We need to know what those factors are. It may be obvious to you, but do your customers share your point of view.

We need to see this from a customer prospective and therefore it is essential to include a series of attributes to be assessed including aspects such as quality, range, reputation or helpfulness, and perhaps knowledge and friendliness of staff for a service provider.

Aspects such as price, value, availability and ease of doing business with may also need to be considered. Environmental considerations, packaging and nutritional information may also be important in some markets.

A few short depth interviews with existing customers in advance of the main survey may help clarify the situation.


What methodology to use?
There are a variety of methodologies – face-to face, telephone, on-line or postal are the obvious choices. On-line is typically less expensive for larger audiences but may not be suitable for all markets or respondents (e.g. over 70 year olds), postal surveys can have low response rates, telephone interviews are often ideal for business-to-business research but contact details are required, face-to-face interviews gives you the opportunity to provide show material such as logos and achieve the best geographical control of your sample but are often the most expensive option.


How Should Satisfaction Be Measured?
Customers express their satisfaction in many ways. They may not even be sure why they are satisfied but still come back to buy again. They may describe did it in terms of satisfaction or delight if asked spontaneously. Therefore for consistency we need to provide a series of scales on which to rate their satisfaction. These are typically 5, 7 or 10 point scales.

Furthermore, we also need to rate the importance of the same attribute in the decision making process. Without this information, valuable resources could be diverted to a dissatisfied but unimportant attribute.

A ranking (normally based on a mean score) value helps clarify satisfaction and importance of attributes. Plotting the attributes against a 2D graph based on satisfaction and importance will also help highlight strengths and weaknesses.


How to Use Customer Satisfaction Studies to Greatest Effect?
Firstly, there needs to be support and buy in to the results from senior management. This team needs to be prepared to implement changes based on the findings as customers have given of their time in order to help improve the product or service and expect changes as a result.

Secondly, any survey is only snapshot in time and an ongoing tracking programme should be considered, benchmarking changes overtime can provide an early warning for areas of future concern.

If budgets allow it would also be important to consider the context of these results, i.e. how do your scores stack up against your competitors? This helps to show gaps in the offering and also potential USPs of each company.

The key elements for consideration when comparing results over time or between companies is consistency (in question design, methodology, overall content and position of individual questions). There is also a need for the sample size to be large enough to allow for comparison across time or products.