The Importance of Customer Satisfaction to Business Success
Success starts with a good foundation, and the foundation of any business success is ultimately customer satisfaction. Arguably, it’s easy to overlook the importance of customer satisfaction when the problem isn’t obvious. Like the layout of the house, you want to invest time in the gorgeous farmhouse sink and French doors, but if the wiring is bad, it will cost far more than you can prepare. That\'s why it\'s important to lay the groundwork for customer satisfaction first.
Five reasons to highlight the importance of customer satisfaction
1. Business decisions are easier to make
Focusing on customer satisfaction can help your business align business goals with customer focus. For example, you can use customer surveys, focus groups, and polls to get a list of your customers\' preferred communication channels.
As a resource, customer satisfaction surveys can help you gain insight into your customers\' needs, and you can stop spending time on things that don\'t seem to add much value. Ultimately, you can better customize your service or product by taking full advantage of customer satisfaction.
2. Customer satisfaction creates loyal supporters
On average, loyal customers are worth 10 times the value of their first purchase.
After a satisfied customer experience, 69% would recommend the company to others, and 50% would use the company more frequently. 95% of customers will \"take action\" after a negative experience -- like sharing their concerns with friends and family or turning to a competitor.
The engaged customer base can expect about 80% of customers from 20% of them. Also, remember when we said reviews are becoming more and more important? Loyal customers can be a very effective form of marketing. A study showed that 85% of new business for small businesses comes from word of mouth.
3. Service culture becomes the promise of the enterprise
Customer satisfaction is the product of optimizing the entire enterprise for efficiency, and optimization often means a collective effort. It\'s not just the support team that is responsible for customer satisfaction.
Customer service should be a mindset across all functions of your business. When your employees feel like they add value overall, it\'s more inspiring than just feeling like an undervalued cog.
In addition, when multiple departments truly understand the importance of customer satisfaction, patterns can be more clearly identified and solutions can be found together.
Agent satisfaction is equally important. In short: a satisfied agency makes customers happy.
4. Customer experience is the main differentiating factor
Customer satisfaction is an important indicator of customer experience. According to a McKinsey study, leaders in customer experience and customer satisfaction achieved a four-fold increase in value over a decade compared to their contemporaries.
Think of it this way: if a lot of people own apples, and every apple seller offers free shipping -- then you can ask anyone to do that, right? But this is often how to do it, not the awesomeness of WHA, which is the decisive factor for customer service. You\'ll choose Apple sellers who are friendlier, more efficient, and remember your name -- right? Personalized contact has become the most important differentiator between companies and has proven to be an important determinant of whether customers will continue to provide services.
5. Customer Satisfaction Increases Customer Retention
As mentioned earlier, retention is more valuable, by satisfying existing customers rather than acquiring new ones. It costs 5-25 times more to acquire a new customer than to retain an existing one. A 5% increase in customer retention can increase profits by 25-95%.
If you don\'t think 5% will meaningfully impact your business and revenue goals, think again. The study found that customer satisfaction directly affects customer retention, while customer churn directly affects customer churn.
Customer churn is the percentage of customers who stop using your product or service within a specific time frame. Most companies monitor customer churn on a monthly or quarterly basis to forecast business and revenue growth.
Watching churn rise may mean you need to dig deeper into your customer satisfaction metrics and surveys to determine why customers are leaving. Lost data can then be used to take pre-emptive measures to retain customers.
