5 Reasons You Need To Be Tracking Customer Satisfaction
Tracking customer satisfaction enables you to keep a finger on the pulse of your customers so you can continue to deliver a great customer experience. This is important because a recent Harris Interactive customer experience survey found that 86% of clients quit doing business with a company because of a bad customer experience.
A poor customer experience can lead to your customers cancelling their contracts and taking their business elsewhere.
It’s no longer good enough to just send customer surveys and get feedback. IT Companies need to monitor changes in satisfaction so they know which clients are happy and which are ‘at risk’.
Gordon Tan, Director – Client Heartbeat & R&G Technologies
Here are five reasons why your company needs to start measuring customer satisfaction.
1. Marketing costs are expensive
It now costs five to six times more to acquire a new customer than it does to retain an existing customer. With more and more competition popping up, your marketing costs are rising as you need to try and attract new customers.
To dig a little deeper, let’s take a look at a real example.
R&G Technologies, a Brisbane IT Support company, budgets $300 per lead and converts one in five, so just there you’re looking at $1200 marketing costs. That doesn’t include the time and money spent on business development managers!
Can you afford to be paying upwards of $1200 for every new customer, only to lose them?
I know I can’t.
If that’s not enough to convince you to take client satisfaction seriously, here are some thoughts on customer acquisiton vs customer retention by Chris Bucholtz from the CMSwire blog.
According to Karl Stark and Bill Stewart, a business that can retain all of its customers by just one additional month can achieve an additional 3 percent of annual growth. If it can retain its customer base for four additional months, it can create double-digit growth without acquiring a single new customer.
2. A lot can go wrong during the lifetime of a contract
As different problems arise and different account managers handle customer inquiries, your client will be receiving numerous customer experiences. With no customer satisfaction tracking, you are going it blind and don’t know how your customers really feel about your service. Yes, they may love Jimmy when he comes out, but what about Tom – do they like his service? Could his poor service be a potential reason for a client to leave?
These are the tough questions you need to ask yourself. You need a system in place to be tracking satisfaction levels across all employees and all the clients their service. That is the only way you can get a full transparent view at how happy your customers actually are.
3. Happy customers refer new business
By ensuring your customers are satisfied, you are putting yourself in the best possible position to create customer advocates that will send you business referrals. One thing that R&G Technologies encourages all staff to do is go into every encounter with a client as if they were going to ask for a business referral at the end. By taking this approach, they are on top of their game, offering outstanding service and striving to exceed customer expectations.
Here are some thoughts from Stuart Selbst, taken from The Secrets To High Customer Satisfaction.
“The first thing that needs to be accomplished is that the company needs to earn to the right to ask for a referral. If they aren’t doing a great job, first of all they know it and second of all, the customer will never refer them out. Once that is accomplished, you need to just ask for a referral. It isn’t as hard as many may think, but it needs to be done and done at least once a quarter.”
– Stuart Selbst, IT Business Coach
4. A drop in customer satisfaction is a key indicator that the client has a foot out the door and is looking at competitors
Client Heartbeat works with businesses around the world to track customer satisfaction and has developed a unique customer satisfaction tool that surveys clients and looks at past satisfactory scores, combined it with industry data to identify unhappy ‘at risk’ clients.
This system has proved an essential component for businesses and has shown that a drop in client satisfaction is the first sign a client is unhappy with the level of service. From that point, the client starts questionnaire their loyalty to the company and starts evaluating alternative providers.
5. Customers defect to competitors based on perceived value
Research by SBA found that 9% of clients will leave because they perceive a competitors offering as better. Annie Miner from The Dunvegan Group believes that to stop this, companies must focus on offering a ‘perceived service’ that is better than competitors. Tracking customer satisfaction and then benchmarking it against others in your industry will help you discover how you stack up against the rest and see if you are at risk of clients potentially defecting to competitors.
Complete a competitor analysis and discover who you should be benchmarking against.
Tracking customer satisfaction will help you improve the customer experience
To reduce customer churn and boost customer lifetime value, you need to focus on tracking client satisfaction so you can measure how good of a customer experience you are delivering.
Get started by using an online survey tool to track satisfaction and find out how your customers really feel about your service.