Tips for Measuring Customer Satisfaction

To achieve success, companies must generate repeat business, getting their customers to return again and again. And they do this by creating highly satisfied customers. But how?

Naturally, this rarely happens by chance. Rather, it’s the owner’s concerted effort to determine the issues that drive customer satisfaction and then deliver on them. The only way to know whether you are delivering on them is to measure continuously.

Murray Corporation, a leading producer of hose clamps for automotive, appliance and other industries, based in Hunt Valley, Md., has been performing customer satisfaction surveys for several years, but it had no basis for comparative reference. Recently, using an outside marketing firm to design and conduct a candid survey, it found that its satisfaction scores as measured by the third party, though reasonably good, were substantially lower than the scores it recorded itself.

Such a scoring difference is typical, the result of both design and execution factors. But troubling questions often emerge as internal or vested interests may inadvertently bias analysis technique and subsequent narrative interpretations.

Survey objectives also influence design. Companies often use surveys to develop and/or test their business strategies, ensuring that they are built on actual customer needs rather than perceived ones. Long-term business plans may be based on survey results, so the stakes could be quite high.

EIG Corporation, a refrigeration controls company formerly of Baltimore, was planning a complete revision to its business plan based on internally generated surveys and perceived customer input developed through its sales force. Again, the results of a professionally designed survey revealed that this strategy was a mistake, and identified previously unrecognized situations affecting customer satisfaction. It also found changes it was planning would exacerbate the problems.

Business owners often react to issues that are mere irritants, having little impact on satisfaction, while important issues hover beneath their radar. Survey development requires a clear understanding of objectives, methodology, objectivity and absence of bias. Companies conducting customer satisfaction research should strive to determine:

• What product and service issues are important to customers?
• How does the subject company perform on these issues?
• How do the issues impact future purchase intent?

The second step is to select a survey methodology, considering population size, geography and demographics. The format and feedback should:

• Accurately reveal status and performance
• Objectively understand the customer’s perspective
• Provide actionable information for reaching total customer satisfaction
• Provide useful information on the marketplace and the competitive environment (benchmarking)

Certainly, survey design must effectively garner participation. Low response rates could render results meaningless, and business owners should be leery of acting on the results of a survey that received a low sample count. Customers who either love you or hate you usually dominate surveys that have low response rates. Neutral customers are less likely to respond. In short, a high response rate provides a higher comfort level because it represents a cross section of all customers.

Morris Binder provided his expertise for this article. He is president of BLC-Bottom Line Connection-Corporate Division, a Baltimore-based sales, market development and market research firm. You can reach him at mbinder@hireblc.com.