Why Customer Satisfaction is Not Enough

It is a mistake to confuse satisfied customers with engaged customers. Study after study show that there is no correlation between customer satisfaction and customer loyalty or engagement. Customer satisfaction is nice to have, but simply it is not enough if the goal is to have customers who return, say great things about you and even go out of their way to do business with you.

Satisfied customers leave organizations every day because they are offered a better (often cheaper) alternative. Engaged customers have an emotional investment in the company, often driven by the employees with whom they interact. They are less influenced by price or a more convenient location. Engaged customers are committed to you because they feel you care about their business.

Measure Customer Engagement, Not Customer Satisfaction

Measure Customer Engagement, Not Customer Satisfaction

Customer satisfaction is a nice to have, but does not result in a secure customer. Satisfied customers may be pleased with a recent experience, but often do not have an emotional connection with the company. This lack of an emotional connection often results in customers with high levels of customer satisfaction switching to competitors for reasons such as a minor cost difference or a slightly more convenient location.

On the other hand, Customer Engagement is a must have, and used by the best and most successful companies in the world. What does an engaged customer look like? PeopleMetrics has established four characteristics of Customer Engagement:

• Retention:  Engaged customers will spend more with you over their lifetime than with your competition.
  
  
• Effort:  Engaged customers will actually go out of their way to do business with you - even spend more to benefit from your products, service and brand.
  
  
• Advocacy:  Engaged customers spread the good word, making it easier and cheaper for you to attract new customers.
  
  
• Passion:  Engaged customers are passionate about the brand – so passionate that they may even spend time actively promoting the brand to others or defending the brand if others speak negatively about it.
  
  

These behaviors and emotions lead to great results for our clients. In fact, PeopleMetrics has proven the positive correlation between Customer Engagement and business outcomes, including earnings per share, gross margin, and return on investment. To learn more about our latest thinking on CEM, please click here. To learn more about the pitfalls of only considering satisfaction in your measurement program, please see why customer satisfaction is not enough.

Take Action on Customer Feedback, Go Beyond Trend Lines

Every time a customer provides feedback on their experience, companies have the opportunity to use that feedback to improve their business, but some simply “roll it up” to view general trends over time. Unfortunately, a majority of companies focus on aggregate trends rather than empowering managers to take the best actions on customer feedback to improve engagement. While aggregate analyses can be valuable, they are often not actionable to managers who are responsible for affecting the trends.

At PeopleMetrics, we are passionate about helping our clients take the best actions on customer feedback. Our CEM solution is designed to help both B2B and B2C companies and their managers respond in the most effective way to customer feedback. Here are a few highlights:

• Questions Designed for Action: our proven core CEM (B2B, B2C) question sets are designed to enable our clients to take action on specific aspects of the customer experience. Our tracking surveys are short (less than 5 minutes) and enjoyable for the client or customer. For our B2C clients, we often begin with a longer survey (about 10 minutes) designed to identify the specific behaviors required to engage customers. Once analysis reveals the top drivers of customer engagement and standards are developed for each driver, a shorter tracking survey measures the pulse on how well these behaviors are being lived by the employees who serve customers. Results from these tracking studies are often used in incentive compensation plans.
  
  
• Action Alerts: based on individual customer responses to specific questions in the survey, Action Alerts are sent directly to the designated people within the client organization via e-mail immediately after the customer submits feedback. CEM includes five types of Action Alerts - Recover, Grow, Recognize, Improve and Market. While the full range of Action Alerts are most applicable to high-value transactions in the B2B space, more and more B2C businesses are seeing the value in following up on their most important customers’ experiences.
  
  
• Action Alert Management: after an Action Alert is sent, a case is automatically created in the CEM Hub and is assigned to the appropriate person who provides updates with regard to progress. This person or a supervisor can then close out cases as appropriate actions are taken. Suggestions are provided on what specific actions will be most effective depending on the type of Action Alert generated. Successful actions are recorded, tracked and shared with the entire organization.
  
  
• Manager Action Planning Tool: largely for our B2C clients, we offer a planning tool that enables managers to identify areas of focus that, if improved, will have the greatest impact on Customer Engagement within their location. This tool includes PeopleMetrics proprietary library of best-practice actions for each question in our core B2C CEM survey and is especially helpful for managers who are incentivized based on Customer Engagement scores.
  
  
• Integration with CRM Packages (e.g., Salesforce.com): we can easily integrate individual level customer feedback into Salesforce.com and other popular CRM packages.