Why measuring customer satisfaction is vital to reduce the churn rate


Measuring customer satisfaction can help you reduce the number of unhappy customers. This is particularly vital when you consider 1st Financial Training Services’ statistic that 91% of unhappy customers will never buy from you again.

Unless you want to see oversized lambasting billboards posted by disgruntled customers about your service levels (or lack thereof), you might want to consider measuring customer satisfaction before it escalates. By measuring customer satisfaction to understand how your products and services meet or surpass customer expectation, you can ensure that service levels remain high – and the customers remain an integral part of your business.

Mitigation vs reaction

While 91% of unhappy customers will never return, a scary 96% of them will never complain about it. This poses a unique problem: how do you know if your customers are unhappy, happy, or apathetic? You’re also stuck between a rock and a hard place, because once a problem has escalated it might be too late to change the customer’s perception.

Mitigation by measuring customer satisfaction is the answer. Putting a customer experience solution in place will:

  • Assist in gathering relevant client feedback.
  • Translate accurate reports to show where the business can take action.
  • Ensure that each and every customer feels that you are doing everything you can to make them happy.

A business can never predict the future or what crisis awaits them. As such, reaction will always need to be taken into account for, but it shouldn’t prevent anyone from having a mitigation strategy in place.

Measuring customer satisfaction to look at the bigger picture

Example: An unhappy Cell C customer went to extremes to make his case known when he felt that the company wasn’t dealing with his concerns. Regardless of the situation at hand, it’s clear that the customer felt unheard if he felt the need to print a massive banner to announce his dissatisfaction publicly. The banner, displayed along Beyers Naude Drive in Johannesburg, accused the mobile company of being the most useless service provider.

Why did this issue happen? How could this have been avoided? Measuring customer satisfaction requires more than looking at the current, flapping red flag (or in this case, big black banner) and analysing the process of the customer journey from beginning to end.

If the disgruntled customer’s journey had been mapped prior to the incident, the store would quickly realise the shortfall, where it failed to assist the customer and how it could avoid increasing frustration levels. In all likelihood, a more customer-centric approach would have avoided the public debacle entirely.

Measuring customer satisfaction across the whole journey will be more predictive of overall customer satisfaction than of isolated interactions. It is a process that needs to be consistent and ongoing.

Be specific and relevant

Any effort of measuring customer satisfaction needs to be precise and applicable. There’s no point asking a customer what he thinks of your email response when he’s never used email to contact you, for instance.

Surveys are great tools for measuring customer satisfaction, but they need to be targeted and structured accurately and effectively. Death by survey is something that would make most people leave a service provider purely due to the annoyance factor.

According to global consulting firm Bain & Company, it costs six to seven times more to acquire a new customer than retain an existing one. Shouldn’t you be focused on ensuring your current customer base is satisfied?

If you’re interested in finding out more about measuring customer satisfaction, contact us.

Recent Posts