Are you getting the full picture? What it takes to create long term sustainable customer loyalty


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Satisfaction now – but what about the future?

Customer satisfaction has become the most widely used metric for companies trying to satisfy and retain customers with the ultimate goal of improving customer loyalty and retention.

There are many tools available to measure customer satisfaction, the data generated providing a snapshot of customer’s views at a given point in time. Many companies carry out these activities without question and find them vital for business decision making; there are others however, who question the return on investment and need for the activity.

We say: Are you doing the right thing? Are you asking the right question?

As well as understanding your customer’s satisfaction now, are you also able to assess their confidence in your ability to support their future needs? Do your customers influence your future plans? Are you getting ‘actionable insights’ to improve the business and in so doing improve loyalty?

Customer satisfaction
is a short term measure, backward looking and is very dependent on how a customer feels about their last interaction with you. It may change quickly as a result of a single transaction.

Customer loyalty is forward looking and an indicator of future behaviour. It is slow to grow and slow to decline making it much more suitable to predict future buying behaviour and promote strong sustainable relationships.

Satisfaction, confidence and willingness to recommend have a strong correlation. In order to build loyalty, you need to understand the drivers and how you are perceived to perform against them.

For more years than we care to remember, we at Bsquared have worked with many companies helping to measure and improve customer loyalty. We have seen numerous examples of organisations measuring the wrong thing, reaching erroneous conclusions and not achieving their full potential.

The most commonly cited example from a few years ago is of Honda. The car manufacturer measured a very high rate of satisfaction with their cars, but had a very low re-purchase rate. The purchasing decision was driven by many factors other than satisfaction.

So, how are you performing?
Loyalty Satisfaction Matrix
You are vulnerable if you are satisfying your customers today, but don’t understand how to behave in the future to help them achieve their objectives. Building relationships, recognising customer’s future needs and generating the appropriate products and services will reduce the risk of your customers choosing a competitor. Identify the value drivers and focus on building these.

You are in a more secure position if your customers like what you do and are willing to remain with you despite current issues causing a lack of satisfaction. Focus here should be on improving the operations of the business.

Star performers – congratulations! Beware the dangers of becoming complacent though.

In the business-to-business world where a handful of customers may account for the majority of your sales, satisfaction with not just each transaction, but with each contact with the company is crucial. Getting the full picture, knowing your customers pain points now and their future needs through great customer relationships at all levels will drive loyalty however you measure it.

Nigel Bagley
Nigel is director at Bsquared Consulting and thrives on helping companies improve through customer driven change. Nigel works with CEOs and their boards to develop customer loyalty and relationship management improvement programmes. He helps Bsquared clients apply a pragmatic people-focused approach, balanced by good planning, information gathering and analysis.


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