Are your Customers Satisfied?

Kathryn Saducas
Partner marketing manager
 The importance of
customer satisfaction
to your business
Customer focused
organisation
Goals of Customer Focus:

Creating Offering Building

Better compelling deeper
Products or customer customer
Services experience relationships

End goal of customer focused strategies is the same:

Boosting retention and repurchase =

more sales!!!
 Business Performance Factors
Contribution to Shareholder Value
90% 86% 83%
75%
71%
80%
62%
70%
60%
50% 47%
40%
30%
20%
10%
0%
Product/Service Customer Sat. Operating Financial Innovation Employee
Quality & Loyalty Efficiency Results Satisfaction

Source: Price Waterhouse Coopers, 2002

 Customer Satisfaction = Profits
• Knowing what drives
• Attracting NEW
customer loyalty is
important to your customer is 4 x cost of
company’s financial health retaining existing
• Repeat customers and new customer
customers from referrals  • 5% increase in
continuous revenue streams customer retention 
• Disloyal customers are 75% in aggregate
expensive to replace lifetime profits from
that customer
 What are your customers worth?
Customer Lifetime Value = CLV
• S = average revenue per
customer sale Lifetime Value of
• C = costs of servicing
customer
Customer (CLV)
• V = expected # sales per
year
=
• Y = expected # years [(S-C)*(V*Y)-A+
customer will use your (A*N)]*F
services
• A = cost of acquiring new OR
customer • Margin * # sales – cost of
• N = # of referrals from acquisition + savings from
customer referrals * correction factor
• F = correction factor
 What are your customers worth?
Customer Lifetime Value = CLV
• S = average revenue per – S = $20,000
customer per sale
• C = costs of servicing
– C = $5,000
customer –V=2
• V = expected # sales per –Y=5
year
• Y = expected # years
– A = $1500
customer will use your –N=4
services – F = 1.2
• A = cost of acquiring new
customer
• N = # of referrals from CLV = [($20000-$5000)*(2*5)-
customer $1500+(1500*4)]*1.2
• F = correction factor CLV = $185,400
Why Customer Sat. is important?
Study by Le Beouf:
“the reasons why customers no longer dealt with a particular
supplier” 3%
5%

9%

No reason

Other Suppliers

Competitors
14%
Product Dissat.

Attitude of owner,
manager or employee
69%
A customer
satisfaction
program
 Customer-Focused Initiatives

Customer Champion
Customer Value Attache
Create a customer champion Director who
Nokia product engineer goes on-site with
is responsible for championing the voice of
customer for up to 1 month to learn about
the customer through the organisation.
challenges and show how Nokia can add
value

Everyday Life Observation

To gain deeper understanding of customer,
send video crews & TV cameras into 80 Customer Charter & Advocate
households around world to capture customer Independent customer advocate whose role is
daily routines to resolve particularly difficult customer and
business problems. Customer charter to
improve customer experience with service.

Customer Success Engineer Team

Centralised group that diagnoses root causes
of complex customer problems and
implements solutions across business
Customer Partner Experience
Organisation-wide customer and partner
satisfaction index to provide a holistic view of
business health and trigger specific corrective
actions where necessary.
The 6 Ps of Marketing
Customer Feedback Program
• With a well constructed feedback program
you can get key insights into customers
to:
– Identify key drivers of customer experience
– Glean insights into health of your company
– Detect early warnings of any erosion of your
relationship or value proposition
Customer Program Activities
1. Assess internal root cause for customer
1
perceptions – satisfaction drivers
2. Derive action plans to resolve most critical
2
issues – set your objectives
3
3. Implement these actions
4. Track your progress with ongoing customer
4
research
5. Link these customer metrics to your financial
5
results & staff incentives
6
6. Tell your customers how you used their
feedback
 Case Studies
Rice University Case • Methodology:
– 50% surveyed (group 1)
Study showed and 50% not surveyed
customer satisfaction (group 2)
– Group 1 were twice as
improves customer loyal to company
retention and company • Conclusion?
profits – Customers want to be
coddled
– Surveys  increase in
auxiliary product sales
– Surveys create opinions
At Microsoft

• Worldwide Survey Apr & Oct

• Customer Escalation Tool
• RMTP – Response Management Through
Partner
• Feedback forms at events (9 point scale)
• Tactical Research – Qualitative &
Quantitative
• Anecdotal feedback
• Roundtable sessions
Understand Satisfaction Drivers
Service
Emotional Factor Quality

Customer
Satisfaction
Price

Product
Quality

Access to
products &
Services
Value Mapping
high

support

Sales staff
service product

reputation
value Bus
expertise

Easy to do
bus with

Brand

low satisfaction high

Example of Value Mapping
high
Service Deployment Time [30%]

Reputation and customer

testimonials [25%]

Account Managers/ Sales

experience [15%]

After Sales Support [10%]

Business Process [10%]

Market/Branding [5%]

Innovation [3%]

Strategic Direction [2%]

satisfaction
low high
1 2 3 4 5 6 7 8 9
Avoiding the Pitfalls
• Listening to the wrong customers
• Incorrectly identifying customer priorities
• Failing to consider strategic objectives
• Failing to align organisation around
execution
• Failing to ‘get paid’ by customers for new
value
• Losing momentum – “campaign mentality”
Case Study – GAP Clothing
 Ways to measure
customer satisfaction
Different forms of measurement
Online
Annual Questionnaires Feedback
Customer Forms
Satisfaction
Surveys
Online
Polls
Customer
Service
CRM Feedback
Other
Software Surveys
(Benchmarking,
Employee, Org
Focus Groups Alignment) Phone or
(Formal/ Fax
informal) Surveys
Partner Program - CSAT Tool

http://www.microsoft.com/partner/media/csat/
Microsoft CSAT – Points Awarded
Participation  
Individual Customer Points
Responses
Partners may only survey
10-24 5 the same individual once
every six months.
25-49 10
50-99 15 Only the first eight
individual responses per
100+ 20
customer organisation are
Net Satisfaction (20+   eligible toward Partner
responses required) Points calculations.
NSAT Score   Points
165-174                 10
175-184                 15
185-200                 20
Measurement & Reporting
• “Satisfaction” can be measured on a scale
• Align business functions around a single customer-focused metric

8
4 NSAT =
7 (VSAT-DSAT)
6 3 +100
5 VSAT = 8+9
4 2
DAST = 1 to 4
3

2 1
1

9 Point Scale 4 Point Scale

 Food for Thought
The name of the game should be
about "giving customers a memory
and experience so great that they'll
want to repeat it." The game is not
all about getting that score—that
darned customer score—any way
possible.
10 Golden Rules
1. Believe customers
1 6.
6 Don’t spend vast sums
possess good ideas of money
2.
2 Gather customer 7.
7 Make it easy for
feedback at every customers to provide
opportunity feedback
3
3. Focus on continual 8.
8 Leverage technology to
improvement – start aid efforts
with top 10 issues
9.
9 Share feedback
bugging your customers
throughout the
4. Solicit good and bad company
4 feedback
10.
10 Use feedback to make
5. Seek real time feedback quick changes
5
 In Summary
“You can’t move a mountain in
a day, but you can make it
easier to climb by clearing a
path.”
Information Source:
• “Why track end to end customer experience?”
TNS Prognostics White paper
• “Driving Customer-Focused Decision Making” –
Marketing Leadership Council USA
• www.Marketingprofs.com