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The simple truth is, if customers aren't satisfied they won't stick around. With fewer customers and a poor reputation, it's really going to hurt a business' bottom line. Therefore, it can be argued that customer satisfaction should be a top priority, even more so than having great products and competitive pricing. What really matters is how customers feel about their entire experience with a brand. Customer satisfaction is so much more than simply retaining customers - when you genuinely care about keeping your customers happy and take pride in your brand's reputation, your business will reap the benefits.
But what exactly are the benefits of customer satisfaction and how can it increase profit? Read on to understand more about customer satisfaction and how you can improve it.
Written by Lauren Shaw
What are the benefits of customer satisfaction?
Satisfied customers can result in a whole host of benefits for your business, including:
- increased customer loyalty, resulting in lower churn and higher retention
- a stronger barrier to prevent switching to competitors
- more repeat purchases and service renewals
- improved brand awareness through word-of-mouth referrals
- a solid customer base with stable sales revenue
- reduced promotional expenditure to acquire new customers
- less sensitivity to pricing (86% of consumers will pay more for a great customer experience).
How does customer satisfaction increase profit?
Customer satisfaction can contribute towards increased profitability – the more satisfied your customers are, the more likely they are to become loyal, returning customers that want to purchase your products or services again and again. They may also recommend your brand to their friends, family members, colleagues and professional connections, and even give you great feedback on online review sites which increases the potential for even more revenue and profit.
Real, satisfied customers cheerleading your brand is the best kind of publicity you can get – it’s free, and consumers really value other customers’ opinions when exploring their purchasing options.
All this can boost your bottom line by helping you build a solid revenue base and reduce the need to spend as much on sales and marketing activities to acquire new customers. So if you want to grow your business and increase your profits, you should prioritise customer satisfaction.
How to improve customer satisfaction
Set realistic expectations
It’s really important that you manage customer expectations by being honest in your marketing messages and only make promises on what you’re able to deliver. Failure to meet the expectations you set out risks antagonising your customers, which may lead to them speaking negatively about your brand.
On the other hand, if you consistently deliver a good experience and leave customers feeling satisfied, they’re more likely to do business with you again and might even become brand advocates. Win-win!
Make the customer journey seamless
Customers really like it when you make things simple for them. Anything you can do to reduce a customer’s mental load and make dealing with your business feel effortless is more likely to leave them feeling satisfied.
Take a look at your processes and ask yourself how you could simplify the customer journey across multiple touchpoints to make things easier for your customers. For example, perhaps you could:
- clarify the message in your advertising campaigns
- make it easier to understand and evaluate your offerings
- reduce the complexity of your diverse product portfolio
- present a simple and consistent pricing structure
- speak to your customers using their terminology and contact them via their preferred communication channels
- use tools to simplify the way you engage with customers, such as a CRM system that tracks every interaction
- create a frictionless purchasing experience.
Listen to your customers
If you know exactly what it is that your customers want, you can take steps towards giving it to them in order to keep them satisfied. There are many tools available that can help you obtain this kind of information, such as social media tracking and customer feedback sites, and customer surveys can even help you get to know your customers on a more personal level by understanding their individual wants and needs.
This is a powerful way to gain valuable data that can guide your decision-making, provide you with suggestions to improve your product or service, and become aware of any issues that could potentially harm your business. Equally, it’s a great way to hear about the things your customers think you’re doing really well at!
However your customers choose to engage with your business, you should aim to reply to them as quickly as possible in order to show them that you’re responsive, helpful, and really value their feedback – good and bad. Build strong customer relationships and your efforts will pay dividends.
Strive to make every customer interaction a positive one
What you really want is to be aware of any problems and complaints before it’s too late. Consumers are more likely to tell others about a bad experience with a brand than a good one, so it’s important to build relationships to ensure customer satisfaction and prevent this from happening wherever possible. Once word gets out about a bad experience, there’s no telling what damage it could do. So work hard to keep your customers happy and to resolve any dissatiscation before it escalates.
Acknowledge problems and fix any issues
As soon as you become aware of any issues that will affect your customers, wherever possible it’s good to take a proactive approach and let them know about it as soon as possible. It’s hard to get things right all of the time, but when mistakes and problems occur it’s always best to be transparent and present a solution to put your customers’ minds at ease. By doing this you’re building trust – a key ingredient to customer loyalty.
Whenever your customers get in touch to let you know about any problems or issues they’re experiencing, whether it be through direct communication, commenting on your social media pages or via online reviews, show them how responsive you are by quickly replying to them and outlining how you can help. That way, you stand a better chance of turning a negative experience into a positive one.
Written by Lauren Shaw, Marketing Manager at FLG.