Measuring Happy Customers

A long used metric for measuring success of a product or business is customer satisfaction. One reason customer satisfaction is important is because of the sharing of information that occurs between consumers. In other words, people will talk and will listen to each other. As reported by the International Herald Tribune, a recent Nielson study found when it comes to advertising, 55% of Americans trust traditional advertising mediums. But 78% trust their friends’ word on products or services. 

 

A recent book by John H. Fleming, Ph.D., and Jim Asplund called The Human Sigma argues that the long held definition of customer satisfaction is misleading if not entirely incorrect. They claim it needs to be better refined to measure the emotional satisfaction of a customer, not just the rational. The emotional satisfaction is based more on the loyalty the customer has to the firm. An excerpt of their book may be read at the Gallup Management Journal website.

 

Whether you believe that your customers should be emotionally attached to your product or not, their satisfaction will have an impact on your bottom line. It costs five times more to replace a customer than to keep a customer. (Dr. Roger Best, Marketing Management: Strategies for Growing Customer Value and Profitability) In this digital age with blogs, instant messaging, and email; information and opinions (good and bad) about your product or service can spread quickly and without you having any direct control over it. Dissatisfied customers, in particular, have a forceful impact. It is estimated that a dissatisfied customer will tell 8 to 10 other people about their experience.(Best) And that does not include the hundreds or thousands more that will read the experience in a blog or other posting to the Internet that becomes permanent. Bottom line: You need to find what adds value for your customer, then satisfaction will remain high and loyalty will develop.