FICCI CE

Customer satisfaction measurement

FICCI CE

“The customer you loose holds information you need to

succeed.”
Frederick F.Reichheld
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Components of customer satisfaction.

• Accuracy
• Adequacy
• Aesthetics
• Availability
• Cost dimension
• Functionality
• Reliability
• Quality & quantity
• Follow through
• Responsiveness
• Timeliness
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Measures of customer satisfaction

• Overall customer satisfaction with the organization and its products

• Rating in the industry on the basis of overall customer satisfaction
• Satisfaction with value for money
• Desire to recommend the product or service to others.
• Loyalty in terms of repeat purchases
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Means of measuring customer satisfaction

I.Customer feedback after delivery of product or service

II.Customer complaints and suggestions
III. Customer Surveys
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I. Customer feedback after delivery of product or service

This is one of the simplest, fastest and the most effective method
of measuring customer satisfaction. The customers should be
immediately asked to evaluate the product or service and
comment upon areas of satisfaction and dissatisfaction.
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II. Customer complaints and suggestions

The organization must have a formalized system of recording all customer

complaints and as well as the methods of their disposal. Customer complaints
must be taken very positively as valuable inputs by the organization and
should immediately trigger the improvement activities.
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IV. Customer surveys

Steps in conducting customer surveys: -

A. Identify your customers requirements under various segments.

B. Determine your survey methodology
C. Develop survey / interview questions
D. Conduct survey / Interview your customers
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A. Identify your customers requirement areas.

It is extremely important to know the requirement of your customers

before designing a questionnaire or survey. This is because if we do not
ask the right questions, the answers we get will be irrelevant and it will be
difficult to find out if the customers are really satisfied with the issues
that are important to them.
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Ways to identify customer requirements

• Discuss the issue with sample group of customers

• Ask your existing customers “If we have to develop a questionnaire to
measure our customers’ satisfaction, what questions should we ask.
• Brainstorming with employees from various functions within the
organization. A cross section of ideas from various people will give us the
complete picture about the requirement of the customers
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Product requirements

For identifying the customer requirements for a

PRODUCT, the survey must cover the following
areas:

• Performance
• Timeliness
• Reliability
• Durability
• Serviceability
• Aesthetics
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Service requirements

For identifying the customer requirements

for a SERVICE, the survey must cover the
following areas:

• Security

• Reliability

• Accessibility

• Timeliness

• Responsiveness

• Empathy

• Assurance
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B. Determine your survey methodology

This requires the organization to answer the following questions :

• How many customers to survey?

• Whom to survey?
• How to survey?
• When to survey?
• Who should conduct the survey?
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How many customers to survey

The basic rule behind sample selection is to choose a cross section of

customers which represents your overall customer base. For example if
your customer database consists of large, medium & small organizations,
your sample must represent the same.
Other criteria for selecting may include percentage of frequent versus
infrequent customers, industry sector & geographic area.
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Whom to survey?

While conducting the survey, the organizations must include the

following customers:
• Present customers
• Potential customers
• Past customers
• Competitor’s customers
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Whom to survey?

The customer sample must never be biased. Everyone wants to hear

good things from the customers and nobody wants to hear a negative
feedback. There is a natural tendency to include a positive feedback and
to exclude the negative feedback. This will never reflect the true measure
of customer satisfaction. The organization must be willing to hear both
positive & the negative from the customers if they are truly willing to
improve their customer satisfaction.
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How to survey?

The following methods can be used for conducting the survey:

• Mail survey
• Telephonic surveys
• Face to face interviews
• Comment cards
The best method will depend on your situation, number of customers
in the sample group and what works best for your customers.
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When to survey?

Survey at periodic intervals:

Many organizations prefer to conduct customer satisfaction
measurement survey at certain time of the year. This however has
certain disadvantages. If the period of survey is widely known it can
signal the time for enhanced services to the customers during that
period. The marketing personnel may distribute questionnaires to
customers during these periods. Such conduct is open to all sorts of
bias & this practice should be discouraged and avoided.
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When to survey?

Surveying continuously:
More & more organizations are moving towards continuous measurement
of customer satisfaction due to turbulent & dynamic marketing
environment. Continuous measurement recognizes the on-going
importance of customer satisfaction and is not influenced by momentary
events (good or bad). This method keeps the organization completely
focused on customer satisfaction & does not allow it to be forgotten
between survey waves.
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When to survey?

Surveying after “moments of truth” :

Moments of truth are any interactions with customers in which an
organizations effectiveness is tested. For example
• Getting the car loan from the bank
• Settlement of insurance claims
• Similarly, receiving money from the cash counter of a bank
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When to survey?

Every moment of truth can be followed up with a satisfaction survey

to determine as to how well the organization has performed in this
important interaction.
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Who should conduct the survey?

The survey can be undertaken by the organizations

themselves or it can also be given to outside agencies. There
are following advantages of getting the survey by outside
professional agencies.
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Who should conduct the survey?

• They are more objective in formulating questions & analyzing

responses.
• Customers are more open when providing information to third parties.
• Professional agencies have the expertise to ensure that the process is
productive & effective.
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C. Develop survey questions

The organization must develop a pre-determined set of

questions which must take into account all the
requirements of the customers.
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Develop survey questions

The questionnaire must give an impression to the customers that you

are thorough & organized when gathering customer satisfaction
information. The presentation & packaging of the questionnaire should
not be shoddy. A good appearance can suggest evidence of
organization’s high commitment to customer satisfaction management
process and vice versa.

Sample questionnaire of the Airline Industry is given in the following slides

FICCI CE

Sample questionnaire - Airlines

A. At the airport Excellent Good Average

➣ Waiting time for getting the boarding pass

➣ Behavior of the front desk executive

➣ Ready availability of information

➣ Time taken in identification of luggage

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Sample questionnaire - Airlines

B. In-flight service Excellent Good Average

➣ Cabin crew’s welcome at the time of boarding

the flight

➣ Availability of reading material

➣ Quality and quantity of food & beverages

➣ Quality of service

➣ Space in the aircraft to keep your hand

baggage

➣ Responsiveness for special service asked for

➣ Cleanliness in the toilets

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Sample questionnaire - Airlines

C. In-flight experience Excellent Good Average

➣ Timeliness of the flight

➣ In flight experience with regard to:-

Noise level

Temperature

Ride and landing

➣ Flight ambience

➣ Overall ratings

Your suggestions for improvement

FICCI CE

Customer survey / feedback forms

Sample survey / feedback forms for consumer durables,

consumer non-durables and service industry are given in MS
Excel file “Feedback forms” given along with this package.

End show
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Advantages of a good survey

A well designed and executed customer satisfaction survey

can be a great asset to any organization due to the
following reasons:
• It can pinpoint expenditure & resources which is being
spent but do not help to satisfy the customers.
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Advantages of a good survey

• It can identify opportunities for product & service

innovation.
• It can ensure that the quality improvement efforts are
correctly focused on issues that are most important to a
customer.
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Why customer survey’s fail?

Unfortunately, a well designed & executed survey tends to be an

exception rather than the rule. The challenge of conducting a
customer survey is to minimize the total amount of error. This
error comes from two different sources.
A. Sampling errors
B. Measurement errors
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Types of sampling errors

These errors deal with the manner in which people are selected in a
survey. They are of following types
• Failing to use statistical sampling methods
• Incorrect selection of profile
• Incorrect selection of number of people
• Ignoring non-responses.
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Types of measurement errors

These errors are related to the content of the survey and the way in
which the results are used. These mistakes deal with :
• Drawing incorrect inferences from the responses
• Asking non-specific questions.
• Failing to ask all the questions.
• Using incorrect or incomplete data analysis methods.
• Error in feeding the results
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Conducting surveys in consumer & business markets

While many professionals and corporate

managers seem to understand the nature of
consumer markets & surveys, many are
quite unaware of how they differ from the
business markets. It is extremely important
for organizations to understand the
difference between consumer & business
markets before the survey is conducted.
The differences are explained in the
following slides.
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I. Size of customer population

Consumer market Business market

Most consumer markets are Many business markets are

composed of large number of composed of relatively small
customers in which no single number of customers of which few
customer has a significant share. buyers may have a substantial share
or dominant position.
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II. Magnitude of purchase volumes

Consumer market Business market

Majority of consumer purchases A large number of business

are for products and services purchases are for products and
which is relatively small in actual services that are relatively large in
rupee amounts. rupee amounts.
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III. Purchase transactions complexities

Consumer market Business market

The purchase of most consumer The decision to purchase major

items is a simple process involving
an individual’s decision to buy or
not to buy.
business products and services is
usually a complex process in which
numerous decision makers and
influencers negotiate terms &
specifications with suppliers.
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IV. Difference in purchase process

Consumer market Business market

Consumer products are sold In the business market, usually the

through retailers, where the products are either sold directly or
attitude of sales staff / dealers has through Co’s regional sales offices
a direct bearing on the sales. and as such are within direct
control of the organization.
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V. Customer knowledge of supplier offerings

Consumer market Business market

As a general rule consumers are Customers have considerable

not very knowledgeable about the
products & services they purchase
or the suppliers operational
processes to produce and deliver
those items.
knowledge of products and often
have means to assess the quality of
the products through pre-shipment
inspection / incoming inspection.
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VI. Nature of customer supplier relations

Consumer market Business market

In majority of consumer markets, The customers tend to actively develop

suppliers and consumers are at an
arm’s length relationship in which the
suppliers do not share proprietary
information or seek their collaboration
in any significant way
close working relationships with their
key suppliers. This relationship may
involve sharing proprietary information
and joint efforts towards product
development and improvement
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Assessing many Vs few customers

By comparing the structural characteristics of consumer and business

markets, it becomes clear that the bargaining balance between suppliers
and customers significantly differs. As opposed to consumer markets, in
which the suppliers sell to many customers, business markets suppliers
routinely sell on a negotiated basis to fewer, more knowledgeable and
more powerful customers.
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Consumer market : Assessing the needs of too many

In a consumer market, we have to assess the needs of many customers

as opposed to business markets where we have to assess the needs of
few customers. In a customer market since every one can not be
surveyed, representative samples ( say 10 to 20 % ) are drawn and
quantitative techniques are used to predict the composite perceptions
of a large population.
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Business market - Assessing the needs of few

In a business market, since a handful of customers can dominate the

supplier’s sales environment, the survey has to be conducted for a very
high percentage of the total customers ( say 70 to 80 % ) and may be
on a one to one basis in a few cases.
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D. Interview your customers

Customers appreciate if asked for a feedback and have come to expect in

many industries. Whichever method is chosen to gather the information,
it must be done in a way which shows the customers that you sincerely
desire the feedback & are serious in using their input for improving the
product / service.
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Interview your customers

It is equally important to acknowledge the participation of the customers in

the survey. Once the survey is over and their valuable inputs have been
considered, they must be informed about it as well. This has a great impact
on customer loyalty and retention.
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Disseminating the findings of your CSM

The report on your customer satisfaction management

must include the following:
• Summary of findings
• Key trends
• Planned follow up measures
• Methodology of improvement plan
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Disseminating the findings of your CSM

It is also important to schedule a presentation to the top management

& top executives. In a face to face discussion, it is far easier for the
executives to ask questions & form consensus of agreement with the
results. The presentation must include an action plan & reference tools
for quality improvement as well.