Customer Satisfaction - The Definitive Metric

It is always interesting for me to hear when people are discussing business metrics and the most important measurement for businesses to consider in its analysis of its own performance. Recently I was asked what specific measurement from the key financial statements did I consider the most important indicator for future success.  

Or as one person put it, if I was about to buy a business what would be the most important number to look at, thinking that I would talk about something from the almighty P&L statement or balance sheet. Certainly contribution margins, gross profit and net profit ratios are all key ratios, but they have one thing in common. 

They are all historical measures that look at what has taken place in the past and can not be relied on to predict what will happen moving forward. For this reason I believe that a superior measure and definitive predictor of future performance  is Customer Satisfaction.

Put simply strong levels of customer satisfaction strongly correlate to future sales based on a strong level of comfort, trust and existing business relationship. The greater the level of customer satisfaction, the greater the probability that customers will stay loyal, return again and ultimately do business with your organisation.

Consider also that research undertaken by Xerox has revealed that customers that are totally satisfied customers are 6 times more likely to purchase your product again in the next 18 months than satisfied customers.


However 95% of customers that are dissatisfied with their purchases (which occurs around 30% of the time), do not complain or give you any indication of their level of dissatisfaction.

This is a frightening scenario when you consider that most on average will go out and tell go out ten people on average who in turn will go out and tell another five. As little Wednesday Addams likes to say, "Be very afraid."

But more importantly of having a healthy does of fear is the conviction that you are going to provide an unfailing level of high customer service that will drive almost unanimous levels of high customer service amongst all your customers.

This commitment will not only  keep them coming back but also encourage strong advocacy and positive networking about your business within the various communities that most individuals belong today these days.

So without any further ado, start thinking about what else you can provide your customers and prospects that will energise them to return and sing your praises to others they will talk to on and off line. In fact pick up a pen and paper now and write down three things you are currently not already doing that will add real value to your target market.

In the end if customer satisfaction really is the key then doesn't it make sense that you need to find a way to raise it perennially in your business?

So until next time, good luck and good marketing.
Regards,
Daniele.