The Importance of Customer Satisfaction for Your Business Success

Customer satisfaction in business is the cornerstone for success in your business. If there is no consumer satisfaction, you cannot retain customers, so consistency in customer service is a major factor that can make or break a business.

Several factors contribute towards the success of your business, but customer satisfaction aces the list. According to ThinkJar, it is 6 to 7 times costlier to get a new customer when compared to retaining an old one.

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Imagine this scenario: You’ve met the love of your life and want to win her over. You use all the standard techniques and she’s willing to make that long term commitment to you. But can you stop with that? You still have to continue working at the relationship to keep it intact! Same goes for customer relationships as well. Customer satisfaction is important for having a long term relationship with your customers and holding on to their loyalty.

What is Customer Satisfaction?

It is Trader Joe’s policy to allow customers to return any product if they are not satisfied with it. This policy could prove to be an expensive one for the company, but it is a customer satisfaction program that finally earns them more customer loyalty. It is this kind of policy that customers share with their friends and it leads to more customers for your business.

By definition, customer satisfaction means the extent to which your customers are satisfied with product or service. Businesses generally use surveys to measure or quantify their customers’ satisfaction. For instance, the Net Promoter Score that helps companies measure customer satisfaction.

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The Importance of Customer Satisfaction

Though it is totally possible that your business could survive despite angry, one time customers, you need satisfied customers for it to thrive and succeed.

• Customer satisfaction can impact the bottom line of your business.

Note: For instance, if your business now has 100 customers spending around $50 a week. If your customer satisfaction is 90%, 90 of them are likely to continue purchasing from you the next week as well. However, if the customer satisfaction is low at 50%, you will lose $50 x 50, meaning $2500, every week. Every unhappy customer brings your bottom line one notch lower.

• It can also impact the retention rate of customers.
• It affects the morale of your employees and team members.

The Benefits

• Insensitivity to price. According to a Defaqto Research, it was seen that 55% of consumers are ready to pay a higher price for an excellent customer experience.
• It leads to repeat purchases and this reduces the costs of your business.

(Source: jagsheth.com)

• You can sell your products at a higher price.
• You get support through brand loyalty from satisfied customers, even during a corporate crisis period.
• You can open your business to new markets through free publicity from happy customers.
• Brand loyalty. Your customers will prefer a one stop shopping, instead of considering other options from your competitors.
• Happy customers make recommendations to their network, leading to more customers for your business.

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Focusing on Customer Satisfaction

So how do you focus on this integral aspect of your business and improve your bottom line?

• Answer consumers’ questions. According to Consumer Technographics’ survey, it was noted that 45% of consumers in the US will get out of online transactions if the company does not address their concerns soon.
• Help them connect with real persons when they need help.
• Create an FAQ on your site.
• Employees must engage courteously with customers to ensure client satisfaction.
• Offer personalized service and make your customers feel important and comfortable.
• Use of Surveys. Why are customer surveys important? It helps consumers voice their concerns or praise your products, so that you can take relevant action to solve their issues and retain them.
• Marketing surveys to gather market data and preferences of consumers, latest trends and requirements.

Measuring Customer Satisfaction

Now that you’ve understood the importance and benefits of customer satisfaction, let’s check out the steps for measuring customer satisfaction.How do you measure customer satisfaction? Measuring satisfaction is not as simple as measuring your profits.

• Getting feedback through customer satisfaction surveys. To put it simply, just ask them about their experience.

Tip: Check out different ways of measuring customers’ experience.

• Post service surveys, like this one, through chat or email.
• Use in app surveys on your website or email surveys like SurveyGizmo for answering several questions.

Tip: Use email surveys templates to make the task easier.

• Use measures like CSAT score rating ranging from 1 to 5 or an NPS Net Promoter Score to measure customer loyalty and whether they are likely to refer you to others.

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Transactional and Relationship Feedback

These are the two approaches for getting customer feedback.

• A transactional feedback survey is done with a customer after every transaction.

(Source: greatbrook.com)

• A relationship survey feedback, takes place at regular intervals.
• It is more concerned with a general or overall level of satisfaction than for a particular transaction.

Tip: Transacional feedbacks are better in some cases, as they are more relevant to a specific purchase and are actionable.

Standing Out from the Competition

According to a recent article from Harvard Business Review, businesses get a competitive advantage and stand out from the rest of the competition when they offer more customer satisfaction and a better experience.

• Instead of delivering a product/service, deliver an experience.
• Think about different aspects of your store that you can customize to deliver a better customer experience. For instance, the layout; the employees and their attitude; your online interactions; your back-end system and so on.
• Involve all your employees and team members to help in creating customer satisfaction.
• Be patient with customers. Acknowledge their problems and listen to them. Understand their issues and try your best to resolve them.
• Interact with customers through phone; social media; email correspondences and try to read their emotions and accurately assess their satisfaction levels.
• Be flexible with company rules. Bend them a little to accommodate a customer request or a last minute need. Believe me,it’s totally worth it, they’ll keep coming back for more.

Note: Check out these sterling examples of customer service where a company has gone totally overboard to support its customers.

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Customer Service Training

Admittedly, while taking the appropriate steps to improve customer service, your employees need a certain skill set for offering customers the best of services. The quality of your customer service is directly proportional to the quality of your employees.

• Use customer data and smart tools for improving customer satisfaction.
• Train your customer service team to be warm and approachable while attempting to solve problems.
• Sincere empathy and sympathy are essential along with an enthusiasm to educate customers to solve problems by themselves if the need arises.
• Good communication skills. This enables them to explain complex tasks in a simple manner suitable for the consumer, instead of giving a long winded, complicated procedure for solving the problem.
• Teach them to be methodical and follow up the problem with the customer.
• Teach them to be resourceful, creative and empathetic.

Actionable Steps to Keep them Happy

Check out these easy steps that you can implement NOW to keep them happy!

• Acknowledge your customer. If they call you, answer them immediately or as ASAP.
• Become familiar with customer names,as far as possible. If yours is a small business, try greeting your customers by name.
• Get information on their birthdays, marriage anniversaries and so on and send them a card, an email or a message wishing them. They will know you care and this can greatly improve your customer satisfaction levels.
• Give them rewards for their brand loyalty. For instance, you can offer a Buy 3 get 1 free offer. You could also offer them a complimentary gift once in a while or a gift voucher and so on. I cannot think of a single person who doesn’t like gifts. 🙂
• Give out free samples.
• Always ask customers for their feedback and opinion. Try to act on the information as far as possible.
• Give your customers adequate details about your product. Go the extra mile.

Tip: If you’re selling perfumes, ask your customer to smell a sample.

• Don’t chase them. You might be eager to make a sale, but do respect the customer’s privacy. Don’t pressurize a customer into making a purchase. Follow up, but do not be aggressive.
• Treat them with respect.
• Offer a refund in case they are not satisfied with your product.

Wrap Up

It’s a win win situation. You serve your customers and keep them happy and your customers remain loyal to your brand and keep coming back to you. That said, it is also seen that customer satisfaction is more important for service related businesses, rather than a product related one.

There are some concerns that customer satisfaction is an expensive aspect of business and that it will increase the costs of your business. This is a myth, because it is about 6 to 7 times more costly to attract new customers rather than retaining an old one.

As your company grows, you need your consumers more than your consumers need you. Therefore, the smart move would be to engage with them more and listen to their choices.

Lack of focus on the customer will lead to a failed business, no matter what its size or niche! Follow these tips, and you’ve just earned a loyal, lifetime customer for your business.

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