Measuring Customer Satisfaction

In: Business and Management

Submitted By keiyetta
Words 834
Pages 4
Introduction
The purpose of this paper is to investigate the application of measuring customer satisfaction and to demonstrate how colleges and university can enhance their existing processes for measuring the student satisfaction of their service provision. The basic goal of customer satisfaction measurement is objective quantification of subjective perception of consumers. The findings of customer satisfaction study can provide information on how to retain existing customers and attract new one. Customer satisfaction is tied directly to profitability. If your customers are happy, they tend to be loyal. And if they’re loyal they not only buy more, they refer other customers. Well-established research by Bain & Company found that, for many companies, an increase of 5% in customer retention can increase profits by 25% to 95%. The same study found that it costs six to seven times more to gain a new customer than to keep an existing one.
Customer satisfaction is the state of mind that customers have about a company when their expectations have been met or exceeded over the lifetime of the product or service. The achievement of customer satisfaction leads to company loyalty and product repurchase.
Identification of Best Practices
Today, competition is fierce, and customers have more options than ever -- a tough combination for smaller companies trying to gain market share. The Net Promoter score is identified as one of the best practices when it comes to measuring customer satisfaction. According to (Brown 2010), the net promoter methodology is used to measure how likely customers are to recommend a product or service to others. Based on a single question, "How likely are you to refer this product or service to a friend," marketers use a 10-point liker scale to determine whether customers are promoters or detractors of a given product or service.…...

Similar Documents

Best Practices for Measuring Customer Satisfaction

...Best Practices for Measuring Customer Satisfaction Dana Atchley Keller Graduate School Introduction There are several means for measuring customer satisfaction including surveys, focus groups, complaints analysis and user groups. Research of top companies around the world seems to suggest that the customer survey method is used more often than any other. There can be problems with data collection and analysis from surveys but technology is improving the measurement of data (Oakland, Beardmore, 1995). We now have computer software to take data, analyze and distribute results. This may be more accurate in reporting the statistics reducing human error, but the survey has to be correctly designed to ensure that data is not tarnished (Fogli, 2006). Measurement Methods The most popular method of measuring customer satisfaction is the survey. Most companies will use independent marketing firms to design and implement surveys that are customized to their industry. These companies can use postal questionnaires and telephone poles to collect data. Usually these questionnaires consist of around fifty questions rating the service on the five point Likert scale (Oakland, Beardmore, 1995). They focus around ordering, delivery, installation and their criteria for excellent suppliers. Telephone surveys are similar in the questions asked but added some different elements concerning competitors. These surveys not only expressed what the organizations are doing well...

Words: 630 - Pages: 3

Measuring Customer Satisfaction

...Introduction The purpose of this paper is to investigate the application of measuring customer satisfaction and to demonstrate how colleges and university can enhance their existing processes for measuring the student satisfaction of their service provision. The basic goal of customer satisfaction measurement is objective quantification of subjective perception of consumers. The findings of customer satisfaction study can provide information on how to retain existing customers and attract new one. Customer satisfaction is tied directly to profitability. If your customers are happy, they tend to be loyal. And if they’re loyal they not only buy more, they refer other customers. Well-established research by Bain & Company found that, for many companies, an increase of 5% in customer retention can increase profits by 25% to 95%. The same study found that it costs six to seven times more to gain a new customer than to keep an existing one. Customer satisfaction is the state of mind that customers have about a company when their expectations have been met or exceeded over the lifetime of the product or service. The achievement of customer satisfaction leads to company loyalty and product repurchase. Identification of Best Practices Today, competition is fierce, and customers have more options than ever -- a tough combination for smaller companies trying to gain market share. The Net Promoter score is identified as one of the best practices when it comes to...

Words: 834 - Pages: 4

Measuring Customer Satisfaction

...Measuring Customer Satisfaction Introduction In order to have a successful business, there must be customers. Customers are considered those who obtain goods or services. Clients may be viewed as those who seek professional advice or guidance. Those who acquire, or agree to acquire, ownership (in case of goods), or benefit or usage (in case of services), in exchange for money or other consideration under a contract of sale are buyers or purchasers (Business Dictionary Definitions, 2011). However businesses view themselves as having customers, clients, buyers, or purchasers, it is important for them to recognize who they are and what it takes to keep them. Years ago the idea was that satisfied customers had a huge impact on the success or performance of the company. Most researchers defined customer satisfaction in terms of how well the company’s goods or services does compared to the expectations of the customer. Some even view customer satisfaction as a characteristic of a total quality culture in an organization. Studies have found that companies who have a higher percentage rate of keeping their customers are more profitable than those with a lesser percentage rate. Identification of Best Practices Per Evans & Lindsey (2009) in Managing Quality, “To create satisfied customers, the organization needs to identify customers’ needs, design the production and service systems to meet those needs, and measure the results as the basis for improvement” (pg. 190...

Words: 1067 - Pages: 5

Best Practice in Measuring Customer Satisfaction

...This is a best practice in the measurement of customer satisfaction courtesy of CDW, one of America’s largest private companies with technology sales of more than eight billion dollars in its most recent fiscal year. CDW had been using Net Promoter to measure customer satisfaction and brand health. You get a Net Promoter Score by asking one question of your customers—How likely is it that you would recommend your company to a friend or colleague?—and then grouping the responses by promoters (those who answer the question with a 9 or 10), passives (7-8), and detractors (0-6). You subtract the percentage of detractors from the percentage of promoters to get your Net Promoter score. This has been a leading edge measure for many companies because it helps them identify opportunities to improve customer satisfaction. CDW decided that Net Promoter was too one-dimensional so, with the help of the person who developed Net Promoter, it went to a three-question approach that, according to Calvin Vass, CDW’s senior manager of research, looks at “different dimensions of the relationship; what the customer plans to purchase with us, if they are committed, and what they would do if we went away.” Vass is quoted in “Is Net Promoter Really the Ultimate Question?” by Drew Neisser (Fast Company, October 20, 2010). CDW segments its market into two groups, Active Customers and Less Active Customers. It surveys the first group quarterly, receiving more than 100,000 surveys per year. It...

Words: 498 - Pages: 2

Best Practices in Measuring Customer Satisfaction

...BEST PRACTICES IN MEASURING CUSTOMER SATISFACTION Case Study: Comcast Corporation GM588: Managing Quality INTRODUCTION In a competitive marketplace where businesses compete for customers, customer satisfaction is seen as a key differentiator and increasingly has become a key element of business strategy. It is critical to give customers the opportunity to provide feedback about their overall satisfaction level and specific likes and dislikes. It is equally important to consistently measure and monitor that input. Without an effective customer satisfaction research program in place, a company will lose business, missing opportunities, and putting itself at a competitive disadvantage. “Customer wants and needs drive competitive advantage, and statistics show that growth in market share is strongly correlated with customer satisfaction.”(Evans, 2010) An outstanding customer experience creates promoters, and promoters are more valuable to a company than other customers. Customer satisfaction is tied directly to profitability. If your customers are happy, they tend to be loyal. And if they’re loyal they not only buy more, they refer other customers. Well-established research by Bain & Company found that, for many companies, “an increase of 5% in customer retention can increase profits by 25% to 95%” (Bain, 2000). The same study found that it costs six to seven times more to gain a new customer than to keep an existing one. Moreover, one...

Words: 1797 - Pages: 8

Best Practices for Measuring Customer Satisfaction

...Best Practices for Measuring Customer Satisfaction Customer satisfaction is perhaps one of the most talked about challenges of organizations in the public and private sectors. Indeed, this represents every organization’s sole purpose, and is at the heart of every organizations mission statement. It is seen as a key differentiator and increasingly has become a key element of business strategy. Customer satisfaction is tied directly to profitability. “Customer wants and needs drive competitive advantage, and statistics show that growth in market share is strongly correlated with customer satisfaction.”(Evans, 2010). If your customers are happy, they tend to be loyal. And if they’re loyal they not only buy more, they refer other customers. It is critical to give customers the opportunity to provide feedback about their overall satisfaction level and specific likes and dislikes. A company will lose business, miss growth opportunities, and put itself at a competitive disadvantage without an effective customer satisfaction research program in place. Therefore, it is very important to the success of the business to know right away if they are doing something that frustrates or dissatisfies the customers. According to Evans & Lindsey (2009) in Managing Quality, “To create satisfied customers, the organization needs to identify customers’ needs, design the production and service systems to meet those needs, and measure the results as the basis for improvement” (pg. 190). A...

Words: 1333 - Pages: 6

Netflix Measuring Customer Satisfaction

...Measuring Customer Satisfaction Paper Prepared by John Green BSOP 588 Marcus Williams MBA, PMP January 2013 Introduction Customer satisfaction is defined as a customer’s overall evaluation of the performance of an offering to date. This overall satisfaction has a strong positive effect on customer loyalty intentions across the wide range of product and service categories (Gustafsson, 2005). There are many ways for measuring customer satisfaction such as customer feedback and evaluations, customer satisfaction, market analysis, service analysis, surveys, complaints analysis, focus and user groups. Nowadays, with modern computer software, it is more accurate to take data, analyze and distribute results of surveys. Survey is one of the most popular method of measuring customer satisfaction. Some companies use independent marketing firms to design and implement surveys that are customized to their industry. These companies can use postal questionnaires and telephone poles to collect data (Oakland, Beardmore, 1995). They focus around ordering, delivery, installation and their criteria for excellent suppliers.   Telephone surveys are similar in the questions asked but added some different elements concerning competitors.   These surveys not only expressed what the organizations are doing well, but where unimportant tasks are being performed.   This results in cost savings as well.   Improvement in technology has created the use of Internet surveys as well.   There are...

Words: 473 - Pages: 2

Measuring Customer Satisfaction

...BSOP588 Managing Quality Introduction Customer satisfaction is vital to any business, big or small. It is one of the distinct gauges of customer loyalty. No company exists without customers and it is very important to keep customers satisfied to have a chance to gain their loyalty. There are several ways a business can keep their customers loyal to their company and measuring and analyzing customer satisfaction can help them accomplish that but also gain knowledge on how to acquire more loyal customers. Customer loyalty is important because it drives repeat business, even if there is a lower price on offer from competitor. Loyal customers come back more often to take up cross sell opportunities and are more likely to try new products from their preferred supplier. Loyal customers are more likely to recommend a business’s services. Profit tends to increase over the life of the retained customer. It can be twenty times more expensive to acquire new customers than retaining existing customers. To accomplish this, successful businesses uses customer satisfaction data to be able to compare internal quality monitoring programs to ensure internal measures match out p actual customer sentiment. It can be benchmarked against other similar companies to determine the level of business competitiveness. It can also be used to set performance targets to outsource suppliers. Help identify areas for improvement. In all these measurements there are negative feedbacks that create a...

Words: 945 - Pages: 4

Measuring Customer Satisfaction (Mcs)

...Shequila Elmore BSOP 588 Measuring Customer Satisfaction Shequila Elmore BSOP 588 Measuring Customer Satisfaction Customer satisfaction is the extent to which a customer is happy/satisfied with the products/services being provided by the organization. It is one of the most important indicators of a successful organization. As. Theodore Levitt once said “The purpose of a business is to create and keep customers”. This means we have to measure the customer satisfaction which is also help the organization by providing insights into how to attract new customers. There are several methods for measuring satisfaction including surveys, focus groups, complaint analysis and user groups. The most used method is the customer survey method, which could be brief or lengthy feedback forms. Surveys can be provided in several ways such as the mail, email, or over the phone (Simpson). Surveying a customer after he/she searches a website with a pop up which guides them to another screen where they can rate the information they found, whether it was useful or not, or staying on the line after you finish with a representative to take a automated survey. This method is used to capture important data that it can use to determine the company’s strengths and weaknesses regarding levels of service (Mayhew). Field intelligence is another method for gathering customer information. Any employee who comes in direct contact with customers can obtain useful information simply by engaging in...

Words: 687 - Pages: 3

Measuring Customer Satisfaction

...Measuring Customer Satisfaction Week 3: Paper Submitted by: Rich De Guzman rich.deguzman32@gmail.com BSOP 588: Managing Quality Instructor: Richard Sheng September 22, 2013 Introduction Being able to provide the best customer satisfaction should be the basis for a company and their vision to succeed. Good customer satisfaction can result in confidence in the company’s products and services however; great customer satisfaction can result in more and new sales or volume. Many companies use different metrics and methods to measure customer satisfaction. This paper will explore a few measures that I have researched and how it correlates to my company or company I used to work for in addition to some recommendations. Identification of best practices One of the most commonly used methods to measure customer satisfaction is by conducting a survey. According to TechRupublic, a survey “allows you to quantify the subjective perceptions of the clients by asking them to convert their perceptions into a numerical rating. The ratings then help the project team better understand how they performed” (TechRadar, 2007). I agree in that surveys do a good job of gathering information so that companies can gain knowledge on how to act and improve their overall customer satisfaction. There are many survey methods out there such as internal and external surveys. This can be deployed in a wide range such as a multiple choice or short answer structure. Many I have seen are...

Words: 992 - Pages: 4

Best Practices in Measuring Customer Satisfaction

...Best Practices in Measuring Customer Satisfaction Lynette Diaz Devry University INTRODUCTION How do you know if your customers are satisfied? Are they more pleased with your company this year than they were last year? How does customer satisfaction of your customers compare that of your competitors? Does this affect your company’s profits? In order to answer these questions, you need hard data. You can do this by measuring and monitoring customer satisfaction on a regular basis. Customer satisfaction is linked to profitability. Keeping your customers happy will keep them loyal and if they are loyal they will buy more and refer your company to other customers. “Customer satisfaction is one of the strongest indicators of customer loyalty” (Lean Consulting Inc.) A study has shown the connection between a company’s profits and customer satisfaction. * “It’s six to seven times more expensive to gain a new customer than it is to retain an existing customer.” * “A 5% increase in customer retention can increase profits by 25% to 95%.” (Reichheld, 1993) There are many different practices to measuring customer satisfaction. Some of the best practices used are comment cards and formal surveys, focus groups, direct customer contact, field intelligence, studying complaints, and monitoring the internet. Depending on the industry, some work better than others. Customer cards and surveys work better in the retail industry. They can work well in finding out how...

Words: 679 - Pages: 3

Measuring Customer Satisfaction

... business, and a competitive study to see how it performs relative to competitors. SSM Health Care uses standardized patient satisfaction surveys that are customized to its five major patient segments, informal discussions with patients and families, and focus groups to understand satisfaction and dissatisfaction (Evans). Another best practice would be measuring and targeting key performance areas. Scoring of a satisfaction survey that was designed using a 5 point scale with a neutral midpoint is by calculating the percentage of responses were the ‘top two’ boxes. Both these responses are positive (Highly Satisfied & Satisfied). Conversely, Dissatisfaction can be calculated as the percentage of responses that were the ‘bottom two’ boxes. Both these responses are negative (Highly Dissatisfied & Dissatisfied). All questions should be scored in this manner to determine the level of satisfaction or dissatisfaction for each question asked in the survey. However, there are only two major Key Performance Indicators being the two ‘overall’ questions (Lean Consulting). Satisfaction can refer to a number of different facts of a relationship. Each industry could add to this list according to the nature of the business and the specific relationship with the customer. Customer satisfaction measurement variables will differ depending on the type of satisfaction is being researched. For example, manufacturers typically desire on-time delivery and adherence to specifications, so measures......

Words: 786 - Pages: 4

Bsop588 Measuring Customer Satisfaction

...| BSOP588 Measuring Customer Satisfaction | Best practices in measuring customer satisfaction in a web environment | | | | | This investigation looks into identifying best practices in measuring customer satisfaction within the website development and content management fields. Its purpose is to examine how organizations can anticipate, improve, and meet customer needs within a dynamic and competitive technology setting. The overall recommendation of this report is for USC Rossier to effectively adopt a combination of Web 2.0 applications, IP Web Portals, and voice of the customer (VOC) protocols. The use of these customer satisfaction measurements in addition to what is currently employed, will allow them to anticipate and meet the needs of prospective student, and have a leg up on competing institutions. Customers visit a website to hire a service, purchase a product or accomplish a specific task. It is the responsibility of an organization to not only meet the customer needs and expectations but also anticipate them. One way the web industry does this is through listing to the voice of the customer through Web 2.0 applications. Web 2.0 applications span all connected devices and “make the most of the intrinsic advantages of that platform: delivering software as a continually-updated service that gets better the more people use it” (O’Reilly, 2007). Web 2.0 software looks at both design patterns and business modes; it uses tools such as Google...

Words: 749 - Pages: 3

Customer Satisfaction

...Abstract This research project report went for demonstrating how ISO 9001-2008 affirmation influences either positively or negatively the customers. In more recent times we have seen numerous organizations in diverse divisions being ISO 9001-2008 guaranteed; numerous are likewise during the time spent getting the affirmation but then in the wake of getting the confirmation numerous don't take after the rules to the letter what's more, this outcomes to having disappointed customers both inner and outer to the associations, consequently, what is the impact of ISO 9001-2008 affirmation on customer satisfaction? The study had 4 goals: to find out how the ISO has impacted recruitment and admission of members, to find out how ISO certification has impacted members’ returns on their savings, to find out how ISO has affected handling of customer complaints and enquiries and to establish how ISO has impacted claim processing and payment of benefits. The study embraced overview research outline. Target populace incorporated 22 lower-level supervisors, 11 center level directors and 33 customers of the chose associations. A poll was utilized to gather information, illustrative investigation, for example, frequencies, rates and means were utilized to break down the information. Relationship was utilized to test the connections that exist between ISO 9001-2008 accreditation and customer fulfillment. ISO procedure and customer satisfaction are entwined and that diverse associations have...

Words: 5202 - Pages: 21

Bsop 588 Week 3 Paper Measuring Customer Satisfaction

...BSOP 588 WEEK 3 PAPER MEASURING CUSTOMER SATISFACTION To purchase this visit following link: http://www.activitymode.com/product/bsop-588-week-3-paper-measuring-customer-satisfaction/ Contact us at: SUPPORT@ACTIVITYMODE.COM BSOP 588 WEEK 3 PAPER MEASURING CUSTOMER SATISFACTION Research the text, library, and web sources for the best practices in measuring customer satisfaction. In a 2-3 page paper ( excluding cover and reference page), explain your findings and link them to your current organizations practices for measuring customer satisfaction. Identify whether your company direction meets or exceeds what the best practices advocate. Make sure you provide at least three supporting sources. BSOP 588 WEEK 3 PAPER MEASURING CUSTOMER SATISFACTION To purchase this visit following link: http://www.activitymode.com/product/bsop-588-week-3-paper-measuring-customer-satisfaction/ Contact us at: SUPPORT@ACTIVITYMODE.COM BSOP 588 WEEK 3 PAPER MEASURING CUSTOMER SATISFACTION Research the text, library, and web sources for the best practices in measuring customer satisfaction. In a 2-3 page paper ( excluding cover and reference page), explain your findings and link them to your current organizations practices for measuring customer satisfaction. Identify whether your company direction meets or exceeds what the best practices advocate. Make sure you provide at least three supporting sources. BSOP 588 WEEK 3 PAPER MEASURING CUSTOMER SATISFACTION To purchase this visit...

Words: 937 - Pages: 4