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What is Customer satisfaction?

Satisfied customers are happy customers: but what exactly does the term customer satisfaction mean and group? Many things in a business indeed depend on this value. This is why it is necessary to have a precise idea of ​​what customer satisfaction means, how to measure it and finally what to do to transform dissatisfied customers into satisfied customers. Explanations.

Summary

  1. Definition of customer satisfaction
  2. How important is customer satisfaction?
  3. How to measure customer satisfaction?
  4. What can customer satisfaction data and measures be used for?
  5. Improve customer satisfaction

Definition of customer satisfaction

Satisfaction always arises when a positive expectation materializes. If expectations are even exceeded, satisfaction increases even more. But if wishes and hopes are not realized, one is inevitably dissatisfied. This also applies in the context of sales and commerce. Customer satisfaction or user satisfaction, for example, determines whether an occasional buyer becomes a regular customer in the long term. For this, the customer must have the most positive experiences throughout the Customer Journey, also called the customer journey.

Customer satisfaction is a question of the link between companies and people, and is therefore an integral part of consumer psychology . Thus, the goal of a business is to improve the customer experience and send many positive signals whether it is before, during or after the purchase. Several factors are important for this. On the one hand, good products and services at reasonable prices play a central role, on the other hand, advice, customer service or the design of the online store and store have a decisive influence on customer satisfaction finally.

In order to measure customer satisfaction, regular surveys are then necessary. It is indeed only on the basis of customer responses and opinions that we can estimate the level of satisfaction and what points need to be improved or re-examined.

Customer satisfaction can be explained by the phenomenon or paradigm of confirmation / dis-confirmation also called paradigm of confirmation of expectations. This phenomenon involves the comparison between the perceived quality and the expected quality. The expected quality is determined by the wishes and expectations (including emotional desires) of the client. The perceived quality consists of the current state of the product, the service and the company. The customer’s desire (expected quality) is compared to the performance level (perceived quality). Customer satisfaction will then result from the difference:

  • Perceived quality <expected quality: if customer expectations are not met, this results in dissatisfaction and we speak of negative “dis-confirmation”.
  • Perceived quality = expected quality: in the case of the correspondence between the two, when the customer’s expectations correspond exactly to the state of the product (performance). This results in customer satisfaction.
  • Expected quality> perceived quality: if the company’s performance exceeds customer expectations. We then speak of a positive “dis-confirmation”, of strong customer satisfaction.

How important is customer satisfaction?

Each company aims for profit, that is to say, it wishes to generate the highest possible turnover at the lowest possible cost. But this is obviously not possible without customers who buy products and use services. This is why it is important to arouse the customers’ interest in your offer (role of classic marketing) and to keep it even after the first purchase. This is where customer satisfaction comes in. If the customer is satisfied with his purchase and overall with the business, he will then consider a new purchase.

Customer satisfaction is therefore very important for a company, because this factor is accompanied by other effects. Satisfied customers like to bond with the company over the long term and thus contribute to the future success of the brand or society. In addition, satisfied customers often pass on their positive experiences and thus become brand ambassadors.

Satisfaction

If you do everything right and your customers are generally satisfied with you and your services or products, then you can expect other positive effects:

  • Customer loyalty: a satisfied customer will express a certain degree of loyalty towards your company and will once again turn to one of your products during their next purchase decision. And this also for a different range of products.
  • Customer loyalty: if a customer is constantly satisfied, he then voluntarily commits himself and buys your products or services without taking other market players into account.
  • Little price sensitivity: the satisfied customer does not turn away from the product or service even if the prices increase slightly.
  • Recommendable: a high level of customer satisfaction guarantees that customers recommend your offers and products to their family and friends or even on social networks.

If you manage to retain a customer over the long term, you will benefit on the one hand from greater planning security and on the other hand from a reduction in customer acquisition costs. Indeed, it is cheaper to keep an old customer than to encourage or canvass a new customer to buy products.

Dissatisfaction

A dissatisfied customer can, however, cause significant negative consequences. Not only is it not necessary to buy again, but the customer can also pass on his negative experiences to other people and thus cause other sales losses:

  • Complaint: a dissatisfied customer may address their dissatisfaction directly to you and may need additional attention to change their mind again.
  • Loss: if the dissatisfaction is too great, your company no longer plays any role in purchasing decisions.
  • Negative communication: negative experiences are shared. Dissatisfied customers are increasingly using the Internet and social networks to rate, warn or express strong dissatisfaction in order to scare new customers away.

That is why, careful and informed complaints management is important to set up, to ensure that a dissatisfied customer does not become a disgruntled and furious customer. Responsible employees must be trained to deal with (sometimes even unwarranted) criticism from customers.

How to measure customer satisfaction?

In order to verify consumer satisfaction, regular and in-depth surveys must be carried out. Surveys can be done by mail, directly in store or even online. After the evaluation, you already have a good idea of ​​the evolution of customer satisfaction. However, in order to be able to work more widely on customer satisfaction, it is necessary to determine clear key values ​​and figures which also allow for long-term analysis.

The Customer Satisfaction Score (CSAT)

The value of CSAT is an indicator that reflects overall satisfaction. In a survey with standard questions, clients are asked to rate their satisfaction based on certain factors – for example, ranging from 1 (very dissatisfied) to 5 (very satisfied). To calculate the Customer Satisfaction Score, only the two highest values ​ (4 or 5) are called into question, i.e. all the responses of satisfied customers. The amount of these responses is divided by the number of questionnaires completed, then multiplied by 100. The result indicates what percentage of your customers is satisfied with the services received.

The Net Promoter Score (NPS)

To measure customer loyalty, which is strongly linked to customer satisfaction, it is necessary to use the Net Promoter Score. The client is asked only one question: “How likely are you to recommend the company / brand / product to a friend / colleague / family member?” ” The client can assess the probability from 0 (very unlikely) to 10 (very likely). The scale is divided into two parts: all respondents who chose 9 or 10 are considered to be “promoters” or brand ambassadors. Customers who have obtained 7 or 8 points are estimated as “passive”, that is to say they are indifferent. Finally, all the others are considered “detractors” (critics).

To calculate the NPS, the percentage of all detractors is subtracted from that of promoters. The result can therefore also be negative, which is a bad sign for your business.

Other indicators

In addition to these two standardized indicators, individual indicators can also be taken into account. The number of complaints or complaints received, for example, is an interesting factor. In this context, pay attention to the social media coverage of your brand. If on evaluation portals or social networks we speak rather positively of the company, products or services, we can then assume great customer satisfaction. Finally, and after all, a certain form of satisfaction also manifests itself in sales. If you notice many repeat sales, that is, sales by existing customers, you can also assume that customers are generally satisfied.

What can customer satisfaction data and measures be used for?

When you collect customer satisfaction data, you need to assess it. This is why it is also important to carry out regular and comparable surveys of customers. This allows you to observe over a longer period whether customer satisfaction decreases or not, if the measures taken are bearing fruit or if on the contrary the situation worsens.
Client surveys can also be used to uncover concrete problems or gaps . This allows customers to identify the cause of their dissatisfaction. If you notice that the same points are mentioned over and over again, then you can start with those specific points. Employees report problems, develop common solution strategies, and ultimately deliver a better product.

Improve customer satisfaction

First of all, as we have already mentioned, you need to conduct regular surveys. Without communicating with your customers, you cannot know what they want from you and your services. You then determine the steps from the results. Much dissatisfaction can arise, for example, at the level of contact between companies and customers, particularly at the level of the helpline or during the stages of advice and sales in the store. Here, it is employee training that makes it possible to find the right solution, even in difficult situations. The establishment of effective complaints and claims management also contributes to increasing customer satisfaction.

The question of whether it makes more sense to just meet or exceed expectations has been the subject of controversy in marketing studies and research. Getting the most out of your product to satisfy the wishes of the customer who didn’t even know they had that desire or expectation, sounds like a great competitive advantage. However, one should always ask at what price this benefit is purchased. To exceed, exceed expectations, a lot of additional work is then necessary, but the result does not seem to be that slightly better than during the strict and simple achievement of expectations.

The expectations also arise in part from your own promises. If you advertise a certain service and you cannot (or not always) perform it, customer satisfaction will decrease. This means that you must either adapt your performance promise, or that you must make additional efforts at the process level in order to meet the expectations that you have created yourself.

Ultimately, however, you improve customer satisfaction by improving the quality of your products and services. If you meet the needs of your consumers, then you can count on long-term success.

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DMT Web Hosting is too concerned about the health and safety of both clients and employees. Our office is closed due to countrywide lock down. You can reach us on +92 300 044 4656, +92 321 112 6660 during the lock down period. We appreciate your understanding and patience.