Customers are always the end users of the product or service that you provide, and as such it is crucial to consider and evaluate their feedback after using said products. In order to do this it is essential that companies establish a method to asses feedback to monitor customer satisfaction. By doing this they can manage and improve on the qualities of the company that tend to be lacking.
Why is Customer satisfaction important?
1. It allows you to differentiate
Customer satisfaction is a important factor that allows the general customer to choose between the same products in a competitive marketplace. Companies who spend time improving customer experiences are more likely to acquire better customer feedback than those that do not focus on this key area. This then allows customers to recommend you to the general public swaying their opinions in order to choose you over your competitors
This is an example of where customer satisfaction goes full circle. Not only can customer satisfaction help you keep a finger on the pulse of your existing customers, it can also act as a point of differentiation for new customers.
2. Indicates customer loyalty
Customers who are loyal to your company usually rate you high when giving feedback. You can be sure that if a customer is satisfied with your product then they are more likely to make future purchases. After a purchase has been done it is good practice to hand your customer a short survey which asks them to rate your services, however this should be kept to a minimum with long term customers as it may get a bit annoying. When handling new customers this could be a valuable tool used to manage your flaws. Survey should incorporate a system that rates your services out of 10, anything below 6 should be looked into immediately as this is an indicator of less than average service.
3. Increases positive word of mouth
A study by McKinsey has shown that 13% of unhappy customers have told over 20 people about their experience. Depending on how many customers you serve a day this could cause major problems.
However word of mouth isn’t always a negative thing, happy customers are also prone to promote your products to their friends and family. In order to maintain positive customer satisfaction it is important to track changes in satisfaction which helps you identify whether or not satisfaction is high. This will ensure that negative word of mouth doesn’t spread but positive word of mouth will.
4. Increase lifetime value of your customers
Satisfaction plays a significant role in how much revenue a customer generates for your business.
Successful businesses understand the importance of customer lifetime value . If you increase life time customer value, you increase the returns on your marketing dollar.
Customer lifetime value is a beneficiary of high customer satisfaction and good customer retention. What are you doing to keep customers coming back and spending more?
5. Retaining customers is cheaper than getting new ones
It is generally a lot cheaper to maintain stable relationships with customers rather than acquiring new ones; 6-7 times cheaper in fact.
It is obvious that it takes a lot of money to grab the attention of potential customers, thousands of dollars may be spent getting new prospects and leads, however not much is spent on keeping the loyal customers you already have.
As it was stated before spending some money on the current loyal customers could prove to be more useful in bringing in new leads than spending thousands on finding one (word of mouth). Not only will this bring in customers it will also make your current ones happy improving customer satisfaction and retention.
If you found this useful please contact us and we will see if we can set up systems for you in order to improve your customer satisfaction:
Phone: 1300 802 163