Measuring Customer Satisfaction

Analyzing financial statements and reviewing the bottom line can only go so far when it comes to measuring your firm's success. Even if you have complete confidence in your business' offerings, gaining a better understanding of people's opinions about your products provides valuable information that can help your company grow and improve its customer service.

Why measure customer satisfaction?

First of all, nurturing relationships with the individuals listed in your customer management software can save you money in the long run. Remember that retaining existing customers is more cost-effective than winning new business - and satisfied customers often provide the most effective marketing by recommending your company to their friends, family and colleagues.

Customer satisfaction surveys

Asking your customers their opinions directly via a survey works well for gathering information on people's feelings and reactions to your products.

Who? Most businesses will want to distribute their survey to as many customers as possible. Still, there may be times when you would prefer to reach a particular demographic, those who have bought a specific product, or a customer segment that follows certain purchase habits.

What? Before you begin putting together your survey, make sure you know its main objectives. This forward thinking will help ensure you are collecting the most relevant and useful information from your customers.

Some basic questions to pursue include whether the person was satisfied with their purchase, how happy they were with the service, how likely they are to buy from you again and whether they would recommend your business to others.

When writing the survey, remember that you can include closed questions - much like a multiple choice test - or open questions, which welcome any type of response. Some business owners find the first too limited, while the second can be difficult to analyze. Combining the two (e.g. asking for further comments after a choice) may provide the best of both worlds.

Finally, it's best to keep your questions short and succinct so that respondents find the survey straightforward to complete.

When? Many experts say surveys are most effective when administered as soon as possible after a customer's purchase, because they will be more likely to remember pertinent details and give constructive feedback.

How often should you survey customers? The answer largely depends on your business and the relationship you have with your customers. If someone only needs your service on an annual basis, it makes sense to conduct a survey at that time. Or, if purchases are more irregular, you may want to include an opportunity to comment with every order.

How? Surveys can be conducted in a number of ways. For example, in a bricks-and-mortar store, you could include comment cards with every purchase or mail out longer versions to particular individuals identified with your customer management software.

Many businesses find they get the best response rate from online customer surveys. Consider directing online shoppers to a survey page directly after they complete a purchase or sending a survey link in your regular email communications. Providing an incentive - such as a random drawing for a prize - can encourage responses.

Focus groups

Organizing a focus group is another handy way to find out what people think of your business - and this is especially good for testing the viability of new products or services. Generally, these groups are fairly small, with no more than 10 to 15 people.

One advantage to focus groups over surveys is that they allow for more in-depth questions and tend to product more exhaustive responses. The facilitator can also follow up on particular points or help guide the conversation in a different direction. Focus groups can be videotaped, so the results can be analyzed at a later date.

Next steps

After you have gathered information, you can begin to identify common patterns and trends. What general and specific changes can you make to address the feedback? Is there any additional staff training that needs to be implemented?

It is also important to follow up with customers to let them know how you have responded to their suggestions. This will show people that you are actually invested in improving their experience, as well as encouraging similar feedback from customers in the future.