RUNING HEAD: BEST PRACTICES IN CUSTOMER SATISFACTION MEASUREMENT
Customer Satisfaction Measurement Best Practices
Keller Graduate School Of Management
Customer satisfaction is the state of mind that customers have about a company when their expectations have been met or exceeded over the lifetime of the product or service. The achievement of customer satisfaction leads to company loyalty and product repurchase. Customer satisfaction is very important in all types of business operations and the best practices that deliver such a satisfaction are the tools that lead to the ...view middle of the document...
If a customer is happy with the product or services of a firm they will certainly come back and buy more. Plus, the happy customer will spread the word and bring in more prospect clients to the firm. Also, the cost associated with retaining an existing client or customer is less by five or six times the cost of acquiring the new customer. But if that retained customer does not feel satisfied it can destroy the whole efforts and the satisfaction practices project stumbles. Customer satisfaction is an important factor for the bottom line. Statistics show that the typical company gets 65 percent of its business from existing customers and their repeat business choices. “One study found that businesses with a 98 percent customer retention rate are twice as profitable as those at 94 percent. Johnson Controls, Inc. (JCI) discovered that 91 percent of contract renewals came from customers who were either satisfied or very satisfied.”(Text, p.193)
Organizations first need to understand the drivers of customer satisfaction; what do customers want or expect from our goods and services? By understanding such needs and expectation the design process of the product and the delivery of the services does become a great tool for measuring the satisfaction levels that are reflections of the aligned design and service with the needs. There are many great and best practices to measure the levels of customer satisfaction by any firm or company that seeks to maximize the chances of wining the customer business and increase their loyalty as well. Some firms and companies are differentiating their approach to the satisfaction measurement process, but the outcomes are identical as they serve clear the vision about the future of the company in a consistent manner.
Such examples illustrate the importance of the best practices in measuring satisfaction. Web analytics, if done properly, will provide key data on customers’ behavior on the site, information for customer segmentation, and major sources of customer abandonment. However, it will not give you any qualitative information, such as why did something happen, what was the customer’s motivation? Plus, surveys, Focus Groups, Eye Tracking studies, Voice of the Customer and Customer Experience Management systems can be used to find the reasons behind customers’ behavior. Having the qualitative information is the missing link in most retail customer satisfaction initiatives. Moreover, determining how customer satisfaction in one channel affects satisfaction in other channels or how it affects purchasing behavior on other channels is key to...