How often does business operate on status quo? We know our customers are satisfied because they continue to order from us. We care about our customers and we think they are happy because the orders keep coming. Often we don’t get a clue that customers could be happier until sales drop... then we scramble to find out why. Profits drop and we are left with a skeleton marketing budget.
Kevin Cacioppo, Global Account Leader, recently wrote a very informative article “Measuring and Managing Customer Satisfaction” for Quality Digest.
(www.qualitydigest.com/sept00/html/satisfaction.html)
In his article, Kevin Cacioppo points out some interesting facts:
“A 5% increase in loyalty can increase profits by 25%”
“Only 4% of satisfied customers will complain.”
“The average customer with a problem eventually tells nine other people.”
“Satisfied customers tell five other people about their experience”
There is a connection between unhappy customers and aging receivables.
“…. it costs five to eight times as much to get new customers than to hold on to old ones…”
What does Mr. Cacioppo recommend we do to make sure our customers are happy? Develop an objective customer satisfaction survey that asks for specific information while taking into consideration subjectiveness. Next, Mr. Cacioppo makes some suggestions on how to put that information to use, like connecting customer satisfaction measurements to the bottom line and…. Maybe even to BONUSES!! Mr. Cacioppo gives some great helps on tailoring customer satisfaction questions to meet survey objectives.
I would like to add that while open-ended questions are more time consuming than yes/no or on-a-scale-of-one-to-ten questions, they are great for gathering information about the customer’s experience. Surveys can include a multitude of methods to gather information… incorporating all three types of questions. It depends how much time and resources you are willing to invest in retaining customers, and how you intend on measuring/tracking the results.
Often, survey questions about customer satisfaction can be asked in a conversation format while following up on orders… for instance:
“Ms. Valued Customer… how is our delivery time working out for you?... Are you receiving our product in a timely manner? How about invoices… are you receiving those in timely manner? Do we need to renegotiate pricing? Do you have any problems we can help you solve ?... is our product keeping your own customers happy?” Understanding and meeting your customer’s needs is vital to keeping customers. Find out what their problems are and create solutions!
Remember, there is a human side to your customers... not all business... customer satisfaction surveys are also a good time to get to know your customers and note that perhaps they are Steelers fans or cheer for USC…. That they celebrate Christmas and Kwanza... maybe they are new grandparents... or this is their first company. When you start to see your customers as more than a sales order number with an invoice number to follow… watch your profits increase…. and your life become richer in terms beyond the bottom line. It’s a given.
Finally, keep up on how competitors are keeping their customers happy! Sometimes we don’t like to pay attention but remember… you may ignore competitors but your customers might not...
Before you jump in and dedicate a team to customer satisfaction surveys, I highly recommend giving Kevin Cacioppas article a read; he offers some very useful and expert insight to the vital task of measuring customer satisfaction.
By the way, a great conversation starter is gift giving. My new neighbors just dropped off a tin of Christmas cookies they and we spent a few minutes getting to know eachother a little better. We celebrate the same faith and like chocolate covered pretzels!
Merry Christmas to everyone out there in cyberspace.
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