Customer Satisfaction

shower-curtainThere was no shower curtain in the hotel room.  My husband and I had taken off after work on a Friday to spend a weekend in the Texas Hill Country.  Nothing special was planned except to hike at a nearby state park, sleep in, eat, drink, and relax.

But we had arrived at 9:30 pm and all I wanted to do was take a hot shower and go to sleep.  The front desk promised they would bring a shower curtain up to our room within an hour.  This was not my preference but since a college sports tournament was playing on television, I figured we could just watch the game while we waited.

After “my” team suffered a lop-sided loss, I called the front desk again.  A different person was on duty and had no idea we were lacking a shower curtain.  He didn’t know where they were stored but called his manager to find out.  When he couldn’t find a shower curtain on the premises after another half-hour, I gave up.  I was exhausted and our relaxing weekend was not off to a great start.

Five Responses to Build Customer Satisfaction

Customers will typically have five separate responses in their behaviors to quality or other issues with a company’s products or services.  As New Product Development Professionals (NPDP), we need to consider customer satisfaction surveys as key inputs to the design and development process.  Solving customers’ stated and unarticulated problems is the goal of developing new products and services.  Certainly, if there is a quality issue with an existing product, it is incumbent upon the new product development (NPD) team to resolve that issue.

Attitudinal Loyalty

A customer response of attitudinal loyalty is one of positive impact to a company.  Consumers with strong attitudinal loyalty say good things about a company and its products.  People will post good reviews on Yelp or Trip Advisor.  They might even select the company to follow on Facebook or Twitter.

Apple customers express attitudinal loyalty as they choose Apple products above all others.  They praise the products and company publicly and will do more business with the company in the future.  Customers camp out just to be the first to order a new iPhone.  While the iWatch does not appear to be a game-changing product, loyal Apple customers still brag about their new product.

Switching Propensity

Economists are well aware of the impact of substitute goods.  Consumers will switch to a different manufacturer, or producer, or brand if the price of a common good is cheaper through a different supplier.  While we generally treat switching as a tendency associated with commodity goods, all products and services can be influenced by a customer’s switching propensity.

In general, switching propensity is when a customer plans to do less business with a firm and instead goes to a competitor with lower prices.  Several factors may influence the customer’s decision, such as quality of the product, availability in the marketplace, and general economic conditions.  Firms should be tracking customer retention rates to understand when and why customers might switch to a competitor.

Paying More

Another behavior that reflects customer satisfaction is paying more for the same pet-sitterproduct or service.  Raw materials and labor costs do increase over time and companies have two choices.  They can live with lower profits margins or pass along the rising costs.  These are not mutually exclusive choices and most firms combine elements of lower profits along with increased selling prices when economic conditions force them to do so.

Customer satisfaction is demonstrated by a customer who absorbs the price increase and continues to do business with the firm.  For example, my pet sitter recently raised rates by $2 per day per animal.  He does a great job, feeding the pets and checking on my house when I’m out of town.  Of course, I’m willing to pay more for his service.  I’m a very satisfied customer.

External Response

In today’s social-media connected world, a complaint can go a long way.  Customers can complain on Twitter, Facebook, Yelp, etc.  Many times, customers will not only say they are never doing business with Company X again, but they will also indicate they are taking their business to a competitor.  Usually, the switch has been stimulated by an unresolved problem or issue.  This is known as an external response.

Consider Robert as an example.  Robert takes loving care of his yard.  He cuts the grass weekly and attacks weeds with a vengeance.  Last summer, he purchased “Brand X” fertilizer.  To his dismay, his neighbors’ yards were greener.  Robert swore to never buy “Brand X” again and has taken all of his yard care business to “Brand Y”.

Note that even though Robert was satisfied with “Brand X” weed killer and pesticide, he tool all of his business to a competitor.  NPD teams need to understand the causes behind decreased market share or sliding sales.

Internal Response

Finally, a more controlled consumer behavior is an internal request or complaint to a firm’s employees when a quality issue is encountered.  In contrast to the customer moving to an outside source, the internal response involves company staff.  For instance, I called the front desk to complain about having no shower curtain.  We also alerted the night clerk and morning clerk of the problem.  There was no reason, in this case, to change my behavior as a customer at any other level.

Engineers and designers need to be plugged into the complaint records at a firm.  NPD team members need to shadow customer service representatives, sales team members, and marketers to fully understand customer issues.  Addressing quality and functionality of products can keep you ahead of competitors in the innovation game.

Customer Satisfaction

NPD teams should look to customer satisfaction as a guiding principle for new product and service ideas and concepts.  Dissatisfied customers cost more to serve and can irrevocably hurt a new product launch.

Customer satisfaction is typically measured by surveys and a deep understanding of changes in market share or market penetration.  Consumers normally express customer satisfaction via five common behaviors:

  • Attitudinal loyalty,
  • Switching propensity,
  • Paying more,
  • External response, or
  • Internal response.

To learn more, please join us in an upcoming workshop on innovation or engineering management through Simple-PDH.com.  Note that are continuing to transition training business to www.simple-pdh.com while maintaining the consulting business here at www.globalnpsolutions.com.  Innovation members receive two monthly communications – the monthly newsletter and our blog post here at the Idea Incubator.  If you have any questions, please feel free to contact us at 281-280-8717 or info@globlanpsolutions.com.

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