Why is customer satisfaction important?

Written by Paul Albu on May 16, 2014. Posted in Articles, Organisational performance

How can we grow our business? What will bring us more success? What is the main driver for favorable results? These are some questions that managers are addressing themselves and whose answers should focus on one essential indicator: keeping customers satisfied.

Nowadays, the pressure put on front desk departments to retain clients is growing day by day. Studies show that there is a direct relationship between customer experiences, customer feedback and financial performance.

As a result, companies strive to maintain their clients happy and in order to do so, they should envisage the big picture, taking into consideration that the business as an ensemble is more than the sum of its separate elements. Each of these components should be considered a pillar that supports the entire structure:

• Quality products / services

The products or services represent the image of the company, and depending on how customers perceive them in terms of quality, they will make a difference between products / services providers. The level of product quality will determine customer experience and it will influence the company’s revenues. Therefore, a company’s products and services are the main revenue generators.

• Customer centric organization

Interaction with clients is one of the key elements for a business to survive, as customers want to feel appreciated and respected. Companies should understand what the clients’ expectations and needs are, in order to meet them.

• Engagement

Customer retention can be done either by engaging previous customers in new products / services, by attracting new clients or by forming communities around the company’s products / services. In the decision making process, the company’s reputation is very important, as customers need to feel they belong to the brand.

• Price per quality

A customer will only pay a certain amount of money for a product, if he considers that the price is fair relative to the quality provided by that good. The price will influence customer experience, in terms of what to expect from the product bought.

Call centers are often the first interaction with the client, and they can influence the customer’s life expectancy. In an evaluation guide for call centers developed by IBM on over 1000 organizations, the most important metrics that correlate to customer satisfaction are: % Abandonment rate, # Average speed of answer, # Call volume, # Customer service quality and # Average handling time.

Other KPIs that can be used for measuring customer care are: % Customer retention, % Customer satisfaction with new products and services, % First call resolution rate and % Repeat customers.

The main learning point is that clients dictate what the company should do, and keeping them satisfied will keep the company successful. That’s why it is important to know how to measure customer satisfaction, as a trigger of business growth.

References:

• IBM (2009), Call center operations and SLA monitoring performance Blueprint
• Jackson D. (n.a.), Profiting from customer experience: Why an easy customer journey makes easy money
• Chi, C. G. and Gursoy, D. (2009), Employee satisfaction, customer satisfaction, and financial performance: An empirical examination, International Journal of Hospitality Management, Volume 28, Pages 245–253