customer satisfaction

Peter Drucker had said that the most basic purpose of a business is to create a customer. He was right. But if we take that purpose one step higher, it’s to create a repeat customer. To achieve this, companies must focus on one element – customer satisfaction.

If you don’t satisfy your customers, you will keep running to get new customers because the existing ones keep leaving through the back door. Eventually, your business will either fail or run on the artificial respirator.

What is Customer Satisfaction?

Most businesses think that customer satisfaction is about a money-back guarantee. But this aspect is much more.

In the year 2000, Philip Kotler defined customer satisfaction as a person’s feelings of pleasure or disappointment resulting from comparing a product’s perceived performance (or outcome) in relation to his or her expectations.

In 2004, Hansemark and Albinsson defined customer satisfaction as an overall customer attitude towards a service provider, or an emotional reaction to the difference between what customers anticipate and what they receive, regarding the fulfillment of some need, goal, or desire.

Thus, in a tangible form, customer satisfaction can be summed as follows:

Customer Satisfaction = Customer experience ÷ Customer expectations

The better the customer experience, the higher the satisfaction.

Customer Satisfaction = Customer experience ÷ Customer expectation
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5 Long-Term Benefits of Customer Satisfaction

All leaders know that customer satisfaction is important if they want to retain customers. More than 80% of businesses agree on the importance of customer satisfaction since it leads to retention, which puts less strain on the company to find customers.

But the benefits of this metric are much larger. Here are some of them:

  •  92% of people trust recommendations from friends and family. Thus, if your customers are satisfied, the people they recommend your service too are much more likely to buy from you. (This has proved to be a powerful source of customers for us as well.)
  • It is 5 to 25 times less expensive to keep existing customers than to acquire new ones.
  • Happy customers leave positive reviews for a company, which is reassuring for new customers. As much as 71% of customers are comfortable to purchase from a company after reading positive reviews about it online.
  • Over 55% of customers are ready to pay a premium for a product is the customer service is good and up to the mark.
5 long-term benefits of keeping customers satisfied
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3 Instances That Left Customers Delighted

Here are three real-life examples of how businesses and brands provided excellent service to their customers and left them not just satisfied, but delighted.

1. Gaylord Opryland – Making a Lifetime Loyalist

A customer named Christina McMenemy had been staying at the Gaylord Opryland hotel three years in a row for the annual BlissDom conference. One aspect that delighted her the most about the stay was an alarm clock that played light music, similar to that at a high-end spa. This clock radio always helped her sleep better than she ever did.

For three years, McMenemy looked for the exact clock radio like in the hotel but to no avail. She finally tweeted the hotel asking where she could buy the device. The hotel responded that their version wasn’t available to the public.

McMenemy gave up searching for the radio clock and attended the conference. But when she returned to her room, she was surprised to find two spa clocks as a gift along with a letter thanking her for being a loyal patron. They recognized the opportunity to delight a customer by providing her with a top-notch experience. It also led to plenty of goodwill for the brand when Christina spread the word.

2. Ritz-Carlton – Taking Care of a Teddy Bear

When Chris Hurn and his family returned from the Ritz-Carlton in Florida, they realized that their son’s beloved stuffed giraffe and best pal, Joshie, was missing. Like many kids who get attached to their special blankets and stuffed toys, Chris’ son was unhappy about not getting to sleep with his best friend.

Chris told his son while putting him to sleep that Joshie was just taking a long vacation at the resort. He also informed the Ritz-Carlton about the story when they contacted him to tell him that they had found the teddy bear.

A couple of days later, the family received a package from the Ritz-Carlton. It contained Joshie and some Ritz-Carlton branded freebies (frisbee, football, etc.). It also contained photos that documented how Joshie had spent his extended vacation at the Ritz-Carlton – besides the pool, getting a massage, making friends with other toys, and also helping around with work at the hotel.

Chris and his wife were blown away by the Ritz-Carlton Loss Prevention Team. As Chris wrote, he and his family will talk about this event for many years to come.

3. Indigo Airlines – Caring for an Elder Woman on Her First Flight

Vishal was about to embark on a flight with his 92-year-old grandmother, for whom it was the first time. He was worried about how things would turn out, especially because he hadn’t booked a wheelchair for his grandmother while booking the flight tickets.

As soon as he reached the airport, a ground staff member from Indigo Airlines rushed to him with a wheelchair. The staff member guided them to an empty check-in line. The person checking them gave him second-row seats and said that since the flight had some space, they could get first row seats for no extra cost.

The ground staff member wheeled his grandmother right to the gate of the flight and another crew member helped her get onto the bus and the flight from the wheelchair. And right when they entered the flight, the air hostesses had offered his grandmother and him the first row seats.

The flight and journey out of the airport at the destination were equally comfortable. As Vishal wrote, the moments are gone but this wave of genuine warmth, joy, and goodness will stay on forever.

How 3 businesses delighted their customers with exemplary customer service
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Why You Should Measure Customer Satisfaction

What gets measured gets managed. – Peter Drucker

Without measuring something, you can mistakenly assume that everything is going fine until you come in for a rude shock. You won’t know that business is slowing down, revenue is falling, orders are not getting dispatched on time, and so on.

Without measuring customer satisfaction, you won’t be able to identify unhappy customers and address their issues. You won’t be able to take action to improve processes to prevent errors. And you won’t be able to retain your customers. The resulting high churn rate will either make your business drag along or pull down its shutters.

Even the most successful businesses have faults. But what makes them successful is the fact that they measure customer satisfaction and take necessary action to improve the numbers.

The primary objective of customer satisfaction, as discussed before, is to improve retention. When you measure CSAT, you can retain customers better. And repeat customers provide much higher lifetime value (up to ten times their initial amount), refer people in their circles, and enable a company to save on costs.

82% of leaders feel that retention is cheaper than acquiring customers. And research shows that repeat customers spend 67% more than a new customer.

Repeat customers spend 67% more than a new customer, according to research
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This means the company can increase its revenue and profitability simply by focusing on one important metric – Customer Satisfaction.

Customer Satisfaction Quotes

Here are five quotes on customer satisfaction to get you thinking about the importance of this metric.

#1. “Customer service should not be a department. It should be the entire company.” — Tony Hsieh, Zappos.com

Most companies believe that customer service is the function of customer support agents. But they’re wrong.

The division of work is a logical step for all departments except customer service. Every department should play its part in offering customers an experience that keeps them coming back to the company.

Customers don’t want just a product or service. They crave an experience.

“Customer service should not be a department. It should be the entire company.” — Tony Hsieh
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#2. “It takes 20 years to build a reputation and five minutes to destroy it.” — Warren Buffett, Investor

It takes a tremendous amount of effort to build a reputation, and even more effort to sustain it. But it takes just a few minutes for all that to get wiped out. Think about Enron and Satyam.

Your organization’s long-term reputation doesn’t get built by articles on leadership and culture. It gets built by word-of-mouth which, in the days of social media, works on steroids.

Treat all your customers as if they’ll talk about every transaction to others. You can never tell when they will.

“It takes 20 years to build a reputation and five minutes to destroy it.” — Warren Buffett
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#3. “Customers don’t expect you to be perfect. They expect you to fix things when they go wrong.” — Donald Porter, British Airways

You are human, and so are your people. You will make mistakes.

Your customers accept this because they’re also human too. But they will not accept you doing nothing to fix a mistake.

Many companies make it difficult for customers to lodge complaints, which further aggravates their frustration and pushes them into the welcoming arms of competitors.

But by highlighting imperfections, your customers do you two favors. One, they give you another chance to prove yourself and turn them into loyal patrons. Two, they highlight chinks in your process which has caused many customers to leave silently without your knowledge.

Fixing customers’ issues is not enough. As a leader, you also must set processes and safety nets to ensure that they don’t occur again.

“Customers don’t expect you to be perfect. They expect you to fix things when they go wrong.” — Donald Porter
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#4. “Know what your customers want most and what your company does best. Focus on where those two meet.” — Kevin Stirtz

Your customers don’t want to know about your product’s “intuitive features”, “best in class service”, or “lowest price.” They don’t care about how your product will revolutionize the market.

They want to know what they can do with your product; how it promises to make their lives better.

The intersection of what your customers need and what you offer is where the magic happens. The larger this intersection, the faster your business grows.

“Know what your customers want most and what your company does best. Focus on where those two meet.” — Kevin Stirtz
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#5. “Good customer service begins at the top. If your senior people don’t get it, even the strongest links further down the line can become compromised.” — Richard Branson, Virgin Group

A company’s culture doesn’t reflect its leaders’ words. It reflects its leaders’ actions. If leaders don’t match their actions and words, people will follow suit. What will happen next?

Leaders must be prepared to get their hands dirty to keep customers happy. They must conduct periodic reviews to keep customer complaints low. They must act on customers’ feedback to prevent errors from occurring rather than merely correcting them all the time.

Such steps don’t delight just customers, but also employees who feel more invigorated to give their best to their work and your customers.


“Good customer service begins at the top. If your senior people don’t get it, even the strongest links further down the line can become compromised.” — Richard Branson
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Summing Up

Put the customer at the center of your company’s universe. As Ray Kroc, former CEO of McDonald’s said, you’ll never make it if you just work for money. But if you love what you do and always put customers first, success will be yours.

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