Description
As you prepare to respond to this post, refer to the “What Is Customer Satisfaction?” Learning Activity. Reflect on an experience you had that resulted in you not wanting to return or engage in repeat business. Describe this experience and explain the following. Of the methods offered in the text to improve satisfaction, which one do you think would be helpful in turning things around from that experience? In what way(s) and how would this make a difference in how you feel about the experience?
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What Is Customer
Satisfaction?
Introduction
Have you ever stopped to think more closely about what is meant by
a “satisfied customer?” Measuring customer satisfaction is an
important element of customer empowerment. But satisfaction
alone is a minimal level of acceptable performance. It means that the
customer’s expectations were met. Consider what makes you a
satisfied customer as you read this section about customer
satisfaction strategies.
Customer Satisfaction Defined
What comes to mind when you hear someone say, “A satisfied
customer?” Perhaps it is an image of someone smiling with the pride
of knowing he got a good deal. Or perhaps it is the childlike look of
happiness someone exhibits after purchasing a new pair of shoes that
are just the right color.
Customer satisfaction is typically defined as the feeling that a person
experiences when an offering meets his or her expectations.
When an offering meets the customer’s expectations, the customer is
satisfied.
Improving customer satisfaction is a goal sought by many businesses.
In fact, some companies evaluate their salespeople based on how
well they satisfy their customers; in other words, not only must the
salespeople hit their sales targets, they have to do so in ways that
satisfy customers. Teradata is one company that pays its salespeople
bonuses if they meet their customer satisfaction goals.
Customer satisfaction scores have been relatively stable for the past
few years as illustrated in Table 4.1. You might think that if increasing
the satisfaction of customers were indeed the goal of businesses, the
scores should show a steady increase. Why don’t they? Maybe it is
because just satisfying your customers is a minimal level of
performance.
Clearly customer satisfaction is important. However, it is not a good
predictor of a customer’s future purchases or brand loyalty. For
example, one study of customer satisfaction examined car buyers.
Although the buyers rated their satisfaction levels with their
purchases 90% or higher, only 40% of them purchased the same
brand of car the next time around (Lambert-Pandraud, Laurent, &
Lapersonne, 2005).
Table 4.1 Industry-Average Customer Satisfaction Scores, 2000–2010
Applianc
200
200
200
200
200
200
200
200
200
200
201
0
1
2
3
4
5
6
7
8
9
0
85
82
82
81
82
80
81
82
80
82
81
72
74
71
71
72
74
77
75
74
78
78
es
Compute
rs
Electroni
200
200
200
200
200
200
200
200
200
200
201
0
1
2
3
4
5
6
7
8
9
0
83
81
81
84
82
81
80
83
83
85
85
80
80
80
80
79
80
81
82
82
82
83
cs
Cars
American Customer Satisfaction Index, http://www.theacsi.org
(accessed October 10, 2011).
Keep in mind, though, that satisfaction scores are a function of what
the customer expected as well as what the company delivered. So
the flat scores in Table 4.1 reflect rising customer expectations as
well as improved products. In other words, the better products get,
the more it takes to satisfy consumers.
There is also a downside to continuously spending more to satisfy
your customers. Recent research shows that firms that do so can
experience higher sales revenues. However, after the additional
spending costs are factored in, the net profits that result are
sometimes marginal or even negative. Nonetheless, satisfaction is
not unimportant.
A company’s performance on key factors is critical both in terms of
the loyalty and satisfaction it generates among its customers (Souki &
Filho, 2008).
Customer Satisfaction Strategies
So what or how much should you do to improve the satisfaction of
your customer? If customer satisfaction can be defined as the feeling
a person experiences when an offering meets his or her expectations,
then there are two critical ways to improve customer satisfaction.
1. First, establish appropriate expectations in the minds of
customers.
2. Second, deliver on those expectations.
We know that dissatisfied customers are likely to tell many more
friends about their negative experiences than satisfied customers are
about good experiences. Why? Because there is more drama in
unmet expectations. A story about met expectations—telling a friend
about a night out that was average, for example—is boring.
The fact that stories about plain old satisfaction are boring is also
why influencer communities, such as JCPenney’s Ambrielle
community, are so important. Influencers have new offerings to talk
about, which are interesting topics, and other buyers want to know
their opinions.
Establishing appropriate expectations in the minds of customers is a
function of the prepurchase communications the seller has with
them.
•
If you set the expectations too low, people would not
buy your offering.
•
If you set the expectations too high, you run the risk that
your buyers will be dissatisfied.
A common saying in business is “underpromise and overdeliver.” In
other words, set consumers’ expectations a bit low, and then exceed
those expectations in order to create delighted customers who are
enthusiastic about your product. A seller hopes that enthusiastic
customers will tell their friends about the seller’s offering, spreading
lots of positive word of mouth about it.
Ritz-
Carlton’s employees are empowered and even given a budget to
provide services that delight customers—not just meet their
expectations.© 2010 Jupiterimages Corporation
One customer satisfaction strategy is to empower customer-facing
personnel. Customer-facing personnel are employees that meet and
interact with customers. In a hotel, this might include desk clerks,
housekeepers, bellmen, and other staff. Empowering these
employees to drop what they are doing in order to do something
special for a customer, for example, can certainly delight customers.
In some organizations, employees are even given a budget for such
activities.
Ritz-Carlton employees each have an annual budget that can be
spent on customer service activities, such as paying for dry cleaning if
a customer spilled red wine on a dress in the hotel’s restaurant.
Companies like Ritz-Carlton also monitor Twitter and other social
media so that any problems can be identified in real time. For
example, one newlywed tweeted that the view outside her window
of another wall was no way to spend a honeymoon. A Ritz-Carlton
employee caught the tweet and employees at the hotel responded
with a room upgrade.
Empowerment is more than simply a budget and a job description—
frontline employees also need customer skills. Companies like RitzCarlton spend a great deal of time and effort to ensure that
employees with customer contact responsibilities are trained and
prepared to handle small and large challenges with equal aplomb.
Another customer satisfaction strategy involves offering
customers warranties and guarantees. Warranties serve as an
agreement that the product will perform as promised or some form
of restitution will be made to the customer. Customers who are riskaverse find warranties reassuring.
One form of dissatisfaction is postpurchase dissonance, also called
buyer’s remorse. Postpurchase dissonance is more likely to occur
when an expensive product is purchased, the buyer purchases it
infrequently and has little experience with it, and there is a
perception that it is a high-risk purchase.
Many marketers address postpurchase dissonance by providing their
customers with reassuring communications. For example, a boat
dealer might send a buyer a letter that expresses the dealer’s
commitment to service the boat and that also reminds the buyer of
all the terrific reasons he or she purchased it. Alternatively, the
dealer could have the salesperson who sold the boat telephone the
buyer to answer any questions he or she might have after owning
and operating the boat for a couple of weeks.
Buy a new boat, and the dealer is likely to engage in reassurance
communications designed to reduce any postpurchase dissonance
and enhance your satisfaction with the offering. The communications
might include phone calls from the salesperson who sold you the
boat or letters from the dealer’s service department.© 2010
Jupiterimages Corporation
Note. Adapted from “Customer Satisfaction,” by Tanner, M. J.,
2012, Principles of Marketing, Chapter 14, Section 3. Copyright 2012
Flat World Knowledge, Inc.
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