Customers are the lifeblood of any business. Business owners want them to be happy. That’s why the saying exists that “the customer is always right” – even if they are not. If the customer doesn’t complain, most business owners assume that they are indeed satisfied with the products and service they receive from your company. As the saying goes, no news is good news after all, right?
Not necessarily, says Carlo Samuels, Sales Manager at CG Consulting, a strategic marketing consultancy specialising in creating new or additional revenue streams for small, medium and large enterprises in the IT, Internet and telecoms sectors of South Africa through lead generation and database profiling.
“Just because customers don’t voice their dissatisfaction to you, doesn’t mean that they are not voicing it to colleagues, associates and suppliers,” Samuels says. “Especially in this age of social media, in which people have constant access to on their smartphones, consumers are far more likely to go online and share their bad experiences on Twitter and Facebook in the heat of the moment.”
Some statistics suggest that the cost of keeping a customer is only one tenth of winning a new one. A new customer is therefore such a valuable commodity; he or she should be kept at all costs.
According to a report compiled by Ryan Nelson of WPA Opinion Research, a customer’s level of satisfaction or dissatisfaction can have a massive impact on a business’s bottom line. First the good news: the report states that a totally satisfied customer contributes 2.6 times as much revenue to a company as a somewhat satisfied customer does, while a totally satisfied customer contributes 17 times as much revenue as a somewhat dissatisfied customer.
And the damage caused by a totally dissatisfied customer? Nelson’s report shows that he or she decreases revenue at a rate equal to 18 times as what a totally satisfied customer contributes to a company.
From the report: “Research has shown that when a person is satisfied with a company or service, they are likely to share their experience with other people to the order of perhaps five or six people. However, dissatisfied customers are likely to tell another ten people of their unfortunate experience.”
Unfortunately, Samuels says, people are far more likely to speak out when they are unhappy about something. “That’s the nature of the beast. People publicly share their anger to let off steam. However, good service and products are expected – that’s what people pay money for after all – so it is far less likely to be praised, unless it was pretty exceptional, or extraordinary. Unless someone is going to ask you specifically to make a recommendation, you’re not very likely to update your Facebook status by writing that you’ve received your regular, good, dependable, solid service when you brought your products from so-and-so today.”
Samuels says one surefire way to gauge whether your current customers are happy is to actually ask them via customer satisfaction surveys. “Customer feedback is extremely valuable, and you don’t want to wait until you hear from a consumer due to the fact that they are unhappy with your service or product,” he says. “So one efficient way to gather such information is by conducting surveys.”
He adds that this type of information gathering is especially important for large companies with multiple divisions, pointing out that while each division may have different customers – or share customers in some cases – customer perceptions of the entire company will be based on their interactions with that division. “When a customer deals with one division, they associate the service they receive with the entire company. However, different divisions can have vastly different approaches and levels of service, so one does not necessarily equal the other.”
He advises not to just focus on the negative. “Don’t just ask your clients what you are doing wrong. Although asking for constructive criticism is always good, there is nothing wrong with asking about what you are doing really well either. Ask what differentiates you from the competition and why they keep coming back to you. This will allow you to keep doing that and even expand on such best practices.”
Samuels, whose company offers customer satisfaction surveys as part of its services, says while the surveys should be employed for sales purposes, that should not become the sole purpose of the survey. “In the end, it is about getting to know your existing customer base better and finding out how you can serve them better. After all, those are the people whose loyalty you want to secure,” he concludes. “Many sales people are constantly looking for new business through new clients, often ignoring the potential for growth among existing clients. This way you open up new opportunities among current clients, in addition to those that can be found among new leads.”