The Business Case For Tracking Customer Satisfaction (6 Benefits)
In a world dominated by big companies and agile startups, it’s a hard environment to grow your business. To be successful, businesses must focus on delivering a superior customer experience that keeps customers happy. But how can you know whether you’re delivering a superior customer experience? Simple, you need to track customer satisfaction.
In this article, I’m going to present six big benefits of tracking customer satisfaction. Once you’ve read the benefits, take a look at these 9 game-changing customer satisfaction strategies to help you actually improve customer satisfaction.
Here are six benefits (with examples) you can get out of tracking customer satisfaction:
1. Identify ‘at risk’ customers
Tracking customer satisfaction helps you monitor changes in customer feedback from one point in time to the next. By tracking these changes you can find customers ‘at risk’. These are customers that have given you satisfaction scores below the average, or that have dropped in satisfaction by more than 20% since the previous surveying period.
Let’s take a look at an example. I was recently talking to a company who had been tracking customer satisfaction for the last six months. The company had a customer who gave them a satisfaction rating of eight three months ago, but in the recent survey, gave them a rating of 6. A drop in customer satisfaction by 25%.
This is a pretty good indicator that something went wrong in the last three months and this customer was now considered ‘at risk’. Since the company was tracking satisfaction, they could now follow up with the customer, and proactively address any concerns or problems.
2. Quickly see trends
Trends in customer satisfaction can help guide your business decisions. For example, if you are tracking satisfaction from May 2013, to November 2013, you can actually measure whether the new business initiatives you implemented have had a positive or negative affect on customer satisfaction.
By actually measuring the effectiveness of your business decisions, you can see what worked and what didn’t. Let’s use R&G Technologies as another example here. Over the past 12 months, the company has increased customer satisfaction by 15%. That’s a noticeable increase and something that has helped the company grow their business and reduce customer churn.
Mimi Tan, Operations Manager at R&G Technologies, shared some thoughts on how monitoring trends has helped the company.
“By being able to track satisfaction across a period of time, I am able to see if the changes we have been making from a management level, actually funnel down to an improvement in customer satisfaction.”
So, how can you identify trends in your customer satisfaction?
Firstly, make sure you are using an online survey tool that lets you track satisfaction scores from one period to the next. Alternatively, if you can export the data into an excel spreadsheet that works as well.
Secondly, when surveying your customers, ensure you use the same questions in your first survey, and in the next survey. That way you can keep everything consistent and measure changes.
Thirdly, compile all the data into a spreadsheet and analyze the feedback. You’ll either see your satisfaction scores increase, decrease or remain steady over the two survey periods. Intelligently break down the data, segment it across account managers or groups, and see if you can find any trends.
Common trends that I see with our customers include:
- Positive/negative satisfaction ratings across a specific account manager or group of customers
- Increase/decrease in satisfaction ratings greater than the industry
3. Find common problems
Do you have problems that just seem to be reoccurring over and over again? Tracking customer satisfaction can help you identify these common problems, narrow down possible solutions, and implement processes to stop them happening again.
If a lot of your customers are leaving sub-par satisfaction scores, you can come across trends in the feedback and comments to determine what the common problems are. Use tools like Client Heartbeat or Google Forms to mash all the feedback into one place.
Once you have all feedback in one place, I recommend organizing a company meeting. I’ve seen this done particularly well at R&G Technologies.
As part of R&G’s monthly business meetings, Mimi Tan pulls out her customer surveys and goes through all ‘at risk’ customers with the team. For each individual customer, she asks the corresponding account manager if there was anything they had noticed which may have impacted the customer’s satisfaction scores. Insight is taken from account managers and then Mimi follows up personally with each customer.
By opening the discussion up in the company meeting, Mimi is quickly able to identify common problems that are causing low satisfaction scores.
Moving forward, the company can focus on solving these problems and improving the customer experience. When the next survey period comes around, R&G is able to measure the increase or decrease in satisfaction, so the company can see whether the business processes they implemented had a positive or negative impact.
4. Hold employees accountable
Tracking customer satisfaction on an individual customer level gives you the opportunity to hold employees accountable for the service they deliver. If your company is setup whereby employees are allocated specific customers, you can actually use customer satisfaction scores as a KPI. This gives you the ability to compare the level of service and satisfaction one employee delivers in comparison to other employees and the company as a whole.
I’ve seen this done really well at a digital marketing agency in Sydney, Australia. They hold employees accountable and use customer satisfaction scores as part of their employee KPI’s. This has created a ‘customer-first’ culture and helped the company improve overall satisfaction. Furthermore, the company is able to identify employees that aren’t delivering a level of service that is up to the company standard.
5. Encourage a ‘customer-first’ culture
I touched on this in the previous benefit but it deserves its own section. To be competitive in this current business climate, companies often have to compete on price. An alternative way to differentiate your services is by offering a superior customer experience. To help with this, you can create a ‘customer-first’ culture inside your company, where all employees are aligned with the same goals and understand their obligations when it comes to customer service.
Zappos is a great example of a company who has used a ‘customer-first’ culture to form a competitive advantage and grow their business. The company is committed to ‘WOWing’ each and every customer.
By tracking customer satisfaction and integrating it into your company, you can create a ‘customer-first’ culture. Tony Hsiesh, Zappos’ CEO, shared some insights into how he built a customer-first culture at Zappos. Here are some statistics that stood out to me:
- On any given day, about 75% of purchases are from returning customers
- Repeat customers order more than 2.5x in the next 12 months after their initial purchase
- Repeat customers have a high average order size
Those are some pretty impressive numbers – what’s stopping you from creating a customer-focused culture?
6. Discover happy customer advocates
Customer satisfaction is directly correlated to how happy your customer is with the level of service you are offering. What a lot of companies don’t realize is that there are lots of benefits associated with actually identifying happy customers and nurturing them into advocates.
Advocacy is that step beyond satisfaction,” Modaro told the itSMF LEADit conference in Canberra. “If I’m an advocate, I’m actually going to go out and tell someone about the great service experience that I had. I’m going to recommend services to my friends, my family [and] my social networks.” – Customer advocacy is critical to business success.
As the competition to bring on new customers gets more expensive, there is more pressure on companies to find ways to grow business referrals through customer advocates.
To put this into perspective, R&G Technologies, a Brisbane IT Company, budgets $1,200 for every new customer. That’s a lot of money and doesn’t even include costs associated with employing a business development manager.
Imagine a world in which your customers consistently referred you new business?
That’s the reality if you can create customer advocates.
Tracking satisfaction helps you keep customers happy
The secret to growing your business is a good customer experience that encourages repeat business. You’ve seen that highlighted by the Zappos and R&G Technologies examples. The challenge for a lot of businesses is how to get that repeat customer. I hope by providing some thoughts on the topic, you can see that the answer is simple, track customer satisfaction. Through tracking customer satisfaction, you can keep customers happy, proactively identify ‘at risk’ customers, and find advocates that can send you new business referrals.
Ross Beard’s latest eBook, “The Secrets To High Customer Satisfaction,” is now available for download. Get it for free at the Client Heartbeat Blog.
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