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What is customer satisfaction and how to improve it?

What is Customer Satisfaction or CSAT?

Customer satisfaction is made up of many different factors. In particular, it is derived from the difference between the customer's expectations and the degree of fulfillment they perceive through the product and the service. The customer carries out a comparison process and evaluates whether his expectations are met, whether the benefits are achieved, or whether he can derive the expected success.

Every company is concerned that its customers are satisfied. At least when it is hoping for follow-up purchases or even recommendations. Different factors determine whether customers are happy or dissatisfied. To find out, you need to rightly question and analyze your customer feedback.

Understanding customer satisfaction

Customer satisfaction can be clarified with a simple question. Ask your customer: "Would you recommend our product, service, or company to others?"

The measure of recommendation is crucial for many companies when it comes to customer satisfaction. The recommendation rate or net promoter score is a prominent key figure for these companies. A customer who does not recommend the company and its services to others is dissatisfied, an essential signal for the company that the performance is not in order.

However, this indicator of customer satisfaction often does not help. Because there is a lack of relevant information from which the company could derive activities and measures to maintain or strengthen customer satisfaction. This information concerns:

  • The general conditions and the customer's situation when buying the product do not have to be the same for other potential customers. The customer will then say that he was satisfied with the product, but currently sees no way that others could also use the product.

  • The customer did not recommend the product because he was dissatisfied. But he doesn't say why he wouldn't recommend the product; the reason for the dissatisfaction is not visible. He may be unsatisfied himself, but still supports the product for other cases.

The recommendation indicator, which is often suggested for measuring customer satisfaction, is not always suitable for measuring customer satisfaction alone. Customer satisfaction surveys are the best way to evaluate your customer service, understand customer churn, and bring about improved customer satisfaction with more happy customers.

Importance of customer satisfaction?

Measuring customer satisfaction is a necessary but also tricky task in marketing and helps evaluate your unhappy customers. Whether a customer is satisfied depends on many factors that the company cannot influence all of them. Often it's not because of the product or the service; the customer is dissatisfied with himself and transfers this to the provider. So it is a methodologically demanding undertaking to measure customer satisfaction in an understandable and reliable manner.

The goal of measuring customer satisfaction is to gain knowledge about the overall customer experience.

  • why customers buy

  • why don't they buy more

  • why they buy despite dissatisfaction

  • what can be improved in the offeror

  • what they tell others about the product.

When companies measure customer satisfaction and get answers to these questions, they are accommodating for product management, marketing, and sales. It becomes clear which product features and services are essential for the customer and enables the provider to stand out from its competitors. Errors or defects are recognized and can be remedied. Interchangeable barriers can be set up or taken down. Suggestions for better products and services can be identified. The recommendations (Net Promotor Score) can be increased in a targeted manner.

Different types of customers and their customer satisfaction

There are four types of customers when it comes to satisfaction:

  • The angry customer is entirely dissatisfied and angry. He turns away and tells others about his bad experiences.

  • The resigned customer wants to remain a customer and buy but is disappointed because he does not get the expected performance.

  • The satisfied customer sees his expectations fulfilled. He is ready to buy again, with priceless and less critical.

  • An enthusiastic customer is a fan of the company and its products. He tells others about his positive experiences.

These different forms of customer satisfaction and dissatisfaction do not have to result in the customer continuing to buy from the company or no longer buying. They are not necessarily linked to customer loyalty. Resigned customers can continue to buy because they have no alternative. And enthusiastic customers can buy from the competition because it results from the current situation.

Customers compare expectations and experiences.

The respective customers have had different experiences with the company, its products, services, and the service. They compare them with their skills and expectations that they formed before buying the product. Expectations usually result from experiences with comparable products (from the competition), through stories from other customers or ideas about an ideal outcome. After the purchase, customers carry out a target / actual comparison between:

  • What was the expectation before buying?

  • What is the performance after purchase?

If the result is positive, they are generally satisfied. If the effect is negative, they are dissatisfied. Overall, no longer customer is unhappy with the company and its services. There is a big difference between expectations and experience. The resigned customer is no longer satisfied with individual parts of the service and does not see any improvements. The satisfied customer sees his expectations confirmed by the services. The enthusiastic customer is often surprised that his hopes have been exceeded or that he receives services that he would not have expected. This relativization of customer satisfaction shows how strongly it depends on customer expectations.

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