Posts Tagged customer loyalty
In modern business there’s increased competition, crowded markets, lesser product differentiation and flatter sales.
So measuring customer satisfaction is key. It reportedly costs five to eight times as much to get a new customer than to hold onto new ones.
So why not operate a measurement system for customer satisfaction and find out what your customers expect from you?
Firstly, don’t just watch sales volumes or rely on a sales rep determining your customer’s state of mind. Also, don’t just track the frequency of complaints or look at ageing debt.
Implement a survey via mail, e-mail, or over the phone and rate experiences on a weighted scale (1 out of 5 etc.). Ensure to repeat this process to see how your customers experience changes over time.
Consider these factors:
- Who is responsible for implementing a system – sales and marketing.
- Management must champion the initiative.
- Compare your own customer satisfaction with your competitors.
- Engage all employees.
- Inform your customers about the changes made due to the survey. Its important to communicate.
Satisfaction can be based on:-
- Business relationship
- The Service and Product meeting or exceeding customer expectations
Did you know? A 5% increase in loyalty can increase profit by more than 25%.
A very satisfied customer is six times more likely to be loyal than a satisfied customer.
Only 4% of dissatisfied customers actually bother to complain, and on average that same dissatisfied customer is likely to tell nine other people about it.
In comparison, satisfied customers will tell five other people on average about the good treatment they received.
You also need to consider the following:
- Are your products less than advertised?
- Are employees making promises they can’t keep?
- Do you know why customers prefer another brand over yours?
- Do you get customers to compare and contrast?
- What is the technology expectation? – E.G. Mobile phones are constantly evolving.
- Conduct a Customer Satisfaction Survey on a regular basis and look for:
- Overall satisfaction: How satisfied are you with ……
- Loyalty Measure: Would you recommend us to…
- Intention to repurchase: Do you intend to repurchase…
Here are 6 thoughts for putting together a customer satisfaction programme:
- Who should be interviewed? The end user, the manager or the directors or all?
- What should be measured? Put yourself in the customers mind-set – what do they consider important?
- How should the interview be carried out?
- How should satisfaction be measured?
- What should the measurement mean?
- How to use the survey to the greatest effect?
It’s debatable whether these should be anonymous or not.
Another strategy is to identify the best company in your sector and set your benchmark against them.
There are links between customer satisfaction and employee satisfaction as happy employee’s work harder, providing greater customer satisfaction.
If a survey is right for your business, then your customer will in-turn expect positive changes to come from it. Most surveys just sit gathering dust. Be sure to communicate quick wins. The newsletter can be a good starting point and turn your customers into very satisfied customers.
This article was taken from a discussion of the Business Exposure Group.
If you are a Director or business owner and would like to attend one of their informative round-table discussions, please contact firstname.lastname@example.org