If you’re here, chances are you get why customer satisfaction is vital for the success of your business. A satisfied customer is more likely to return and make repeat purchases, and they are also more likely to recommend your company to others which ultimately drives long-term success.
In our article today, we’ll discuss everything about customer satisfaction – from what it is, why you need to measure customer satisfaction, and how you can do it.
What is customer satisfaction?
Customer satisfaction refers to a customer's level of contentment with the products, services, or experiences they have received from a business. Customer satisfaction shows how well a company meets or exceeds customer expectations, and it can be influenced by a variety of factors, including product quality, customer service, pricing, and overall customer experience.
High levels of customer satisfaction are important for businesses because they can lead to increased customer loyalty, positive word-of-mouth recommendations, and repeat business.
Customer satisfaction growth directly correlates to revenue growth
Know who your customers are
Your customers aren’t always of one mind. There are customers who enjoy purchasing your products, but there are others who prefer to use your services since your offering varies. And there too are customers who only look at your products and have not really decided on anything yet, and there are customers who are lifelong advocators of your products because of just how amazing they are. For better measurements – and better campaigns, it’s important to group customers first before asking them for feedback. Here are some ways on how you can do it:
- Demographic groups: Customers can be grouped based on demographic factors such as age, gender, income, education level, and occupation. This type of grouping can help you identify trends and patterns in satisfaction levels among different customer segments.
- Product or service groups: Customers can also be grouped based on the products or services they have purchased. This grouping can help you identify which products or services are performing well and which ones need improvement.
- Purchase frequency: Grouping customers based on how frequently they make purchases to identify patterns in satisfaction levels among frequent or infrequent customers.
- Customer loyalty: Another way to group customers is by their level of loyalty to your business. This can include customers who have made multiple purchases, referred others to your business, or provided positive reviews.
- Customer journey stage: Group customers based on their stage in the customer journey to identify pain points and areas for improvement in the customer experience at different stages of the journey.
Why measure customer satisfaction
Looking at the statistics, it sounds almost obvious that every business should measure and monitor customer satisfaction to drive more revenue growth – but there are only a few of them who take customer satisfaction seriously. Measuring customer satisfaction is important for several reasons:
- Improve customer retention: Satisfied customers are more likely to remain loyal and continue doing business with your company. By measuring customer satisfaction, you can identify areas for improvement and take action to keep customers happy.
- Increase customer loyalty: Satisfied customers are more likely to recommend your business to others, which can help increase customer loyalty and drive new business.
- Identify areas for improvement: By measuring customer satisfaction, you can identify areas of your business that are not meeting customer expectations. This can help you make improvements to your products, services, or customer experience.
- Monitor business performance: Customer satisfaction can be a key performance indicator (KPI) for your business. By tracking satisfaction over time, you can monitor how changes in your business are affecting customer perceptions and adjust your strategy accordingly.
- Stay competitive: since 59% of customers will give up on a company after a bad experience, businesses that prioritize customer satisfaction are more likely to succeed in the long term
How should customer satisfaction be measured
To measure customer satisfaction, first, you’ll need to define what metrics you’ll want to use for measurements, which means defining the goals and objectives of your campaigns and then choosing a metric that satisfies your goals. Additionally, knowing when to carry out your campaigns is also important to achieve the best results.
Important metrics
When talking about customer satisfaction, there are three main metrics that you’ll need to know:
Customer satisfaction score (CSAT)
This metric evaluates the level of customer satisfaction with a product or service. CSAT surveys typically ask customers to rate their level of satisfaction with a particular interaction or experience with a company.
These surveys are usually conducted using a rating scale, with customers being asked to rate their satisfaction on a scale from 1 to 5 or from 1 to 10, for example. The data collected from CSAT surveys can be used by companies to identify areas for improvement, to evaluate the success of marketing and customer service initiatives, and to track changes in customer satisfaction over time.
Customer effort score (CES)
CES is usually measured using a survey question that asks customers to rate the level of effort required to complete a particular action, such as resolving a problem, making a purchase, or using a feature of the product. The question is often phrased as, "How much effort did you have to put forth to handle your request?" or "On a scale of 1 to 10, how easy was it to complete your task?"
The scores range from 1 to 7 or 1 to 10, where 1 represents "very difficult" or "very high effort" and 7 or 10 represents "very easy" or "very low effort". The higher the CES score, the lower the customer effort, and the more likely the customer is to be satisfied with their experience.
Net Promoter Score (NPS)
NPS is widely used by companies as a tool for measuring customer loyalty and improving customer experience. It is based on a single-question survey that asks customers to rate on a scale of 0 to 10 how likely they are to recommend the company's product or service to a friend or colleague.
Based on the rating given by the customer, they are categorized into three groups:
- Promoters (score 9-10): Customers who are highly satisfied with the product or service and are likely to recommend it to others.
- Passives (score 7-8): Customers who are satisfied with the product or service but may not be enthusiastic enough to recommend it to others.
- Detractors (score 0-6): Customers who are unhappy with the product or service and are likely to spread negative word of mouth.
Although it’s mainly used to track customer loyalty, NPS is also vital to customer satisfaction as unsatisfied customers are more likely to become detractors and spread negative feedback about your brand.
Know when to measure
Now that you know which metrics you should use in your next campaign, knowing when to roll out your surveys is also important to ensure that the feedback is relevant and actionable. For the CSAT survey which you’ll primarily use to measure customer satisfaction, for example, you can measure it during the customer journey:
- After a purchase: Measuring CSAT after a customer has made a purchase can help companies understand the customer's satisfaction with the buying process, including factors such as product quality, pricing, ease of purchase, and customer service.
- After customer support interactions: Measuring CSAT after a customer support interaction can help companies understand how well their support team is meeting customer needs and resolving issues.
- After a product/service delivery: Measuring CSAT after a product or service is delivered can help companies understand how satisfied customers are with the delivery experience, including factors such as timeliness, accuracy, and communication.
- Regularly: Measuring CSAT on a regular basis (e.g. quarterly or annually) can provide a broader view of customer satisfaction and identify trends over time. This can help companies track the effectiveness of their efforts to improve customer satisfaction.
How to improve customer satisfaction
After you’ve already collected the data from all your surveys, there are several ways to improve customer satisfaction further:
Address customer complaints
Analyze the survey data to identify areas where customers are experiencing issues or dissatisfaction with the products, services, or customer service provided by your business. Once you have identified the issues, take action to address them by making changes to your processes, products, or services. Follow up with the customer to let them know you have addressed their concerns, and ask for feedback on whether the changes made have improved their experience.
Use positive feedback to reinforce good practices
Positive feedback is a powerful tool to reinforce good practices and boost employee morale. Share positive feedback with your team to highlight what is working well and recognize employees who are delivering exceptional customer service. By celebrating successes and acknowledging hard work, you can create a positive and productive work environment that motivates employees to deliver outstanding customer experiences.
Implement changes based on feedback
Customer survey data provides valuable insights that can be used to make improvements to your products, services, or customer service processes. Analyze the data to identify areas where improvements can be made and prioritize changes based on their potential impact on customer satisfaction. Once you have identified the changes to be made, develop a plan to implement them and communicate the changes to your team and customers.
Communicate changes to customers
Communication is key, and once done right, this simple practice can let customers know that their complaints were heard and resolved. Additionally, this also shows that you are committed to continuously improving the customer experience, which helps build trust and confidence in your business and increase customer loyalty.
Train employees
Well-trained employees are essential to delivering exceptional customer service. Use the survey data to identify areas where employees may need additional training or support. Develop training programs that address these areas and provide ongoing coaching and support to help employees develop the skills needed to deliver outstanding customer experiences.
Overall, the key to improving customer satisfaction is to listen to your customers, take action based on their feedback, and continuously strive to improve the customer experience. By doing so, you can build strong relationships with your customers, increase loyalty, and ultimately grow your business.
Tools to improve customer satisfaction
Available tools on the market can help you track and even give insights about what you can do to improve customer satisfaction. Filum’s Customer 360, for example, gives you a holistic view of what your customers are thinking about your products and services, with vital metrics such as CSAT & NPS automatically calculated, collected, and displayed in a coherent manner.
