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What is Customer Satisfaction?


❶Good quality measures need to have high satisfaction loadings, good reliability, and low error variances.

14.3 Customer Satisfaction

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Testimonials posted as reviews on your website, partner sites and in e-newsletters, act as referrals that outline reasons why shoppers can trust your business. These actions can improve customer opinion, business practices and create positive advertising. A small e-business owner addresses dissatisfaction by following up with a customer via phone or email within a week after a sale, or immediately after receiving or hearing about a complaint, to attempt to resolve issues or ask for customer feedback.

Another way you can use satisfaction is by satisfying customers with more than your product offerings. Customers use the Internet to search for content such as general information, instruction guides or tips that they consider interesting or valuable. They often base their buying decisions on what they find. Valuable content can result in positive advertising as customers share positive content-related experiences with others. It can also increase loyalty as customers start to see you as an expert about industry-related topics.

Small e-business owners distribute valuable content in a wide variety of ways including via e-newsletters, articles, videos, webinars, chats, live online events, social networks and forums.

Based in Southern Pennsylvania, Irene A. Blake has been writing on a wide range of topics for over a decade. Skip to main content. Feedback Whether customers are satisfied or dissatisfied with your business, any feedback they provide about their experience or the products and services they want can help you with your marketing strategy. Testimonials Feedback in the form of solicited or unsolicited detailed praise, or testimonials, is a valuable marketing tool that can help you to attract new customers, retain current customers and build your reputation.

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 risk-averse find warranties reassuring. 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. 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.

To measure customer satisfaction, you need to able to understanding what creates it. Yet many companies often measure the satisfaction of their customers on the basis of only a few questions: Effective customer satisfaction measures have several components. Companies might break the offering into major components and ask how satisfied customers were with each. For example, a restaurant might ask the following:. These questions assume that each aspect of the service is equally important to the customer.

However, some surveys ask customers to rate how important they are. In that case, the survey can be shortened considerably. At the same time, however, space should be left on the survey so customers can add any additional information that could yield important insight. For instance, a sample of customers could be given the opportunity to provide more detailed information via another survey and the two surveys could be compared.

Such a comparison can help the company pinpoint aspects that need improvement. In addition, the company has given every customer an opportunity to provide input, which is an important part of any empowerment strategy.

When buyers want to complain about products or companies, they have many ways to do so. People who use every Internet site possible to bash a company are called verbal terrorists. Should companies worry about verbal terrorists? To measure the tradeoff between the two, customer satisfaction guru Fred Reicheld devised something called the net promoter score.

The net promoter score is the number of recommenders an offering has minus the number of complainers Reicheld, According to another recent study, a company with fewer complaints is also more likely to have better financial performance. Some experts have argued, perhaps jokingly, that if this is the case, a good strategy might be to make customers mad and then do a good job of resolving their problems.

Practically speaking, though, the best practice is to perform at or beyond customer expectations so fewer complaints will be received in the first place. Customers will complain, though, no matter how hard firms try to meet or exceed their expectations. Sometimes, the complaint is in the form of a suggestion and simply reflects an opportunity to improve the experience.

In other instances, the complaint represents a service or product failure. When a complaint is made, the process for responding to it is as important as the outcome. And consumers judge companies as much for whether their response processes seem fair as whether they got what they wanted. For that reason, some companies create customer service departments with specially trained personnel who can react to complaints.

Other companies invest heavily in preparing all customer-facing personnel to respond to complaints. Still other companies outsource their customer service. When the service is technical, marketers sometimes outsource the resolution of complaints to companies that specialize in providing technical service.

Computer help lines are an example. Technical-support companies often service the computer help lines of multiple manufacturers. A company that outsources its service nonetheless has to make sure that customer complaints are handled as diligently as possible. Otherwise, customers will be left with a poor impression. A good customer complaint handling process involves the steps listed below. A customer who is angry or upset due to a failure does not want to be patronized or have his or her problems taken lightly.

The situation is important to the customer and should be important to the person listening and responding to the complaint. Note that the complaint-resolution process involves communicating that process and gaining agreement on a solution, even if the customer sometimes might not like the outcome.

He or she still needs to know what to expect. Finally, the complaint process includes recording the complaint. To conduct this analysis, however, you need a complete record of the complaints made. A complaint record should reflect the main reason an offering failed. You can attribute the complaints your company receives to one of the four gaps and then use the information to figure out what must be done to fix the problem, assuming you have one.

If it appears that the offering is simply not meeting the needs of your customers, then more work should be done to identify exactly what they are.

When the Smokey Bones chain of barbecue restaurants owned by Darden Restaurants noticed falling profits, managers cut costs by eliminating some items from the menu. Many locations were closed and the company filed for bankruptcy. Keep in mind that the complaint handling process itself is subject to complaints. Measuring customer satisfaction is an important element of customer empowerment. But satisfaction alone is a minimal level of acceptable performance.

Getting positive word of mouth requires exceeding those expectations. To minimize the number of complaints a company needs an effective process of both handling complaints and understanding their causes so any problems can be corrected. Harvard Business Press, This is a derivative of Principles of Marketing by a publisher who has requested that they and the original author not receive attribution, which was originally released and is used under CC BY-NC-SA.

For uses beyond those covered by law or the Creative Commons license, permission to reuse should be sought directly from the copyright owner. Learning Objectives Understand satisfaction and satisfaction strategies. Design a customer satisfaction measurement system. Describe complaint management strategies. Customer Satisfaction Strategies So what or how much should you do to improve the satisfaction of your customer?

Definition: Customer Satisfaction

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Customer satisfaction is an abstract concept and involves such factors as the quality of the product, the quality of the service provided, the atmosphere of the location where the product or service is purchased, and the price of the product or service.

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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. The first is to establish appropriate expectations in the minds of customers.

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Definition: Customer Satisfaction. Customer satisfaction measures how well a firm is able to meet the expectations of customers. Customer satisfaction is a key concept in marketing, as a firm cannot retain its customers unless it has highly satisfied customers. Customer Satisfaction Definition. Customer satisfaction is a term used to describe a scenario when an exchange meets the needs and expectations of its user. It captures the provision of goods or services that fulfil the customer’s expectations in terms of quality and service in relation to the price paid.

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Customer satisfaction is a consumer’s perception of how well an organization has delivered on their communicated value proposition. The key points to note about this definition are: Customer satisfaction is the perception of a consumer. Definition: Customer satisfaction indicates the fulfillment that customers derive from doing business with a firm. In other words, it’s how happy the customers are with their transaction and overall experience with the company.