Customer Satisfaction Won't Inform Your Business Strategy
Updated: Jan 21
Many companies have established ongoing customer satisfaction programs: your department or company may be one of them. If not, you probably see many customer satisfaction survey examples once you finish a purchase transaction with a company. The airlines and lodging industries are particularly good at sending out requests for feedback shortly after every flight or stay. Yet a recent conversation with a client gave me pause: he rather confidently indicated that customer satisfaction research was the primary tool used for strategic insight into the performance of their business and the minds of consumers. Um, not.
Customer satisfaction research is not strategic research, and it never will be because it was never intended to be. Customer satisfaction research results cannot identify areas for new product development, a new advertising or communications strategy, or possible new market opportunities. Importantly, customer satisfaction research cannot tell anyone if the business is expanding or contracting, or effectively meeting customer needs, since it is restricted to recent customers.
At its best, customer satisfaction research is a process control and exception reporting tool. But even these goals are sometimes elusive, especially when the measures being used are general and nonspecific. Customer satisfaction can be very useful if trying to determine if specific performance criteria are within acceptable limits. However, the research ‘container’ (i.e., areas of investigation, questions, scales, and metrics used) is generally naïve in terms of whether the dimensions themselves are relevant or not.
One can hypothesize that, in a number of cases, some of the measures being asked probably have little to do with characteristics of the transaction that matter, or where the business is going – or where it is been. As an exception reporting tool, customer satisfaction is useful; as a business guidance and strategy development tool, it is of limited use.
But where does that leave us if most marketing managers and researchers don’t recognize the essential distinction between a process control tool and research designed to help grow the business?
The function of strategic research is to help an organization look out the window and navigate the uncertain and constantly changing road ahead. It is both quantitative and qualitative in nature. Strategic research helps the management team understand their customers’ attitudes and behaviors about the products they are using – and also those of their competitors. Additionally, strategic research helps identify the direction in which category users feel the market is going. It’s research that is dynamic, and always listening to customers general feelings and more detailed perceptions of your brand or service, rather than restricting their responses to the measures that are predetermined in a customer satisfaction study.
Don’t be lulled into complacency by positive customer satisfaction research results that indicate your business is doing well among your existing customers. You are only getting part of the story, and strategic research (which can take many forms, and should be conducted routinely) involves actively listening and responding to the ever-changing needs of today’s customers.