Customer care is a substantial role of the telemarketing and direct marketing industries. Customer service representatives who staff telephone centers nationwide are cost-justified by the need to better satisfy customers.
The entire complaint response industry is similarly oriented in rectifying problems that customers experience with products and services. With this commitment, one would suppose that customers are receiving better service and feeling more satisfied. This isn’t the case. American Customer Satisfaction Index scores for U.S. consumers show a downward trend over the past eight years.
Why have all of these initiatives failed to generate more satisfied customers? The answer is simple and sobering: Management has been unable to find ways to consistently make satisfaction initiatives register with customers. The sad truth is that many customers who have contacted customer service centers or had their complaints answered still defect. They change brands or suppliers.
These facts cause the importance of satisfaction to be challenged. Some managers may foolishly conclude that their company or brand is immune to dissatisfaction. Others may consider customer satisfaction unnecessary in their industry. Both assumptions are dangerously wrong.
When satisfaction seems unrelated to customer loyalty or behavior, we think the problem is in how satisfaction-oriented practices have been delivered and how results have been measured.
Overwhelming scientific evidence shows a relationship among customer satisfaction, market share and profits. Recent studies show there are thresholds of satisfaction beyond which little benefit is obtained. As a company reaches customers’ minimally acceptable satisfaction level, it becomes a viable alternative for consideration.
In short, the company provides the bare necessities and is, therefore, “in the game.” At that point, however, there is a discontinuity in the relationship between satisfaction and customer behavior. We refer to this transition point as moving from the Zone of Pain to the Zone of Mere Satisfaction.
Falling into the Zone of Pain is a reliable predictor of customer defections. A company cannot survive in this region unless its strategy is pure price leadership and customers are willing to trade satisfaction for low price. This is not a winning situation for companies. Furthermore, the Zone of Mere Satisfaction seldom drives profits.
Success comes when customers move beyond the Zone of Mere Satisfaction to where they demonstrate behaviors consistent with the firm’s goals. This area is the Zone of Delight, where customers describe their situation as “delightful.” Such customers remain loyal, attract other customers and increase their spending. It is here that generating satisfaction really pays dividends.
How does a company achieve delighted customers? These six steps can help.
1. Measure customers’ level of satisfaction. The first step is to get customer feedback. Unless you have a small base of customers, this requires a fundamentally sound measurement process. While there is often the common lament that “we already know” what customers want, virtually every firm would be delighting their customers if it were that simple. Information from this effort will serve as the roadmap to delighted customers.
2. Determine what drives delight and what merely prevents dissatisfaction. Managers tend to act as if the attributes studied in their customer satisfaction surveys have a straight-line effect on customer satisfaction. In other words, when each attribute is underdelivered, it creates dissatisfaction. When it is delivered at an exceptional level, it generates customer delight.
That is not true. There are two distinct types of attributes: those that maintain satisfaction and those that create delight. Satisfaction-maintaining attributes tend to be core attributes frequently considered the price of entry in the marketplace. Delight-creating attributes tend to be soft, relationship-building factors. As a result, actions designed to eliminate dissatisfaction seldom drive delight. Therefore, it is imperative that managers separate attributes into those that maintain satisfaction and those that create customer delight.
3. Eliminate dissatisfaction. Delight is possible only if the customer is satisfied to begin with. For example, no amount of gourmet chocolates offered by your bank will offset the displeasure of it mistakenly bouncing your checks. It is imperative to ensure first that core attributes are delivered at what customers perceive to be an acceptable level.
4. Determine what it will take to delight customers. The key is to determine the service level where positive performance produces customer delight. This requires an understanding of the responsiveness of an attribute to change and its current performance. The greatest opportunities are those areas that have relatively weak performance, but strong effects on customer delight.
5. Measure backward. Once the performance thresholds based upon the customer satisfaction information have been established for delighting customers, it becomes imperative to link customer satisfaction measures to actual business processes.
Customer needs generally are not expressed in managerially meaningful language. To do so, establish a company metric that associates as closely as possible with a delight-creating attribute. The metric should be constructed so that improving a business process results in an improved score on the internal metric and in more delighted customers. For example, if a key delight attribute is product reliability , an internal metric might be the percentage of repair calls.
6. Measure forward. It is important to link drivers of delight to business processes. The other part is the outcome in terms of customer behavior, specifically, the effect on sales. The most profound profit effect from customer delight is in terms of increased customer retention rates. Remember that the relationship between different levels of satisfaction and customer retention rates will not move in a straight line.
Beginning a customer-delight strategy can be very rewarding. Delighted customers return and bring their friends. In the words of the great quality authority, W. Edwards Deming, “It will not suffice to have customers who are merely satisfied.” We would add, “They must be delighted.”
