Why is Customer Satisfaction important?

Why is Customer Satisfaction important?
June 28, 2021 zonka
In Hospitality
Customer satisfaction

Zonka Feedback is an omnichannel survey app enabling you to use CX metrics like Net Promoter Score (NPS Surveys), CES & CSAT to gather actionable feedback. They count a large number of hospitality businesses among their customers and help to drive customer satisfaction for those businesses. 

Businesses that deliver a satisfying experience grow at a much faster pace than those which don’t.

67% of the customers and 74% of business buyers are ready to pay more for a more satisfying experience. Satisfied customers will make repurchases from your business and attract more customers through reviews and word of mouth. Let’s understand what customer satisfaction actually is and why it is so necessary for your business.

What is customer satisfaction and why is it so necessary?

Customer satisfaction is the measure of happiness or fulfilment of the customers with a product, service, processes and capabilities of a business, brand or organisation. It is essentially the extent to which a seller can fulfil the needs and expectations of the customers.

But why is customer satisfaction so important? Let’s understand this with this instance. Imagine you go for dinner with your family at a big restaurant. When you go inside, you find everything a good restaurant should have – a great ambience, welcoming staff, a hygienic environment, comfortable furniture, and a menu with a variety of dishes at competitive prices. 

You order your food and it arrives within a couple of minutes. You are impressed with the fast service! But when you taste the food, you feel that the food is not fresh and it tastes bad. How would you feel? Of course, really unhappy – because despite getting all the facilities at the place, you did not get the satisfaction you needed and expected from the core product you had come for.

As a result, you will not only abstain from going to the restaurant again but even tell your friends how the poor quality of food spoiled your quality time with your family. On the contrary, if you had enjoyed the food and had a perfect experience at the restaurant, you would even recommend that restaurant to your friends as a great place to dine.

Let’s learn about how you will benefit if you can satisfy your customers.

Benefits of Customer Satisfaction

  1. Higher Customer Loyalty
  2. Higher Revenue
  3. Good Reputation in the Market
  4. Less Customer Churn
  5. Reduced Cost
  6. Competitive Advantage in the market

Let’s explore more about these benefits and how you gain them through Customer Satisfaction.

Higher Customer Loyalty
There is something successful businesses hold in common: a bunch of loyal customers. Customer loyalty is the measure of customers’ likeliness to repeat purchases from a business and refer the brand to others. Customer satisfaction directly drives customer loyalty. When your customers are satisfied with your products and services, they choose your brand over and over again and eventually become your loyal customers.

Higher Revenue
When the customers are satisfied and repeat purchases from a business as a result, it increases sales of the business. Moreover, they can also attract more customers through recommendations. 72% of customers share a positive experience with around 6 other people. All this leads to higher sales revenue and more profit.

Good Reputation in the Market
Customers share their feedback in the form of reviews and comments on shopping websites and social media.

When customers are happy and satisfied, they share positive reviews about your brand. Researches suggest that 68% of customers decide to buy a product after reading 1-6 reviews. This helps boost your brand’s reputation in the market, which ultimately helps in the growth of your business.

Less Customer Churn
Negative experiences lead to customer churn. 32% of customers stop doing business with a brand they loved with just one instance of poor customer experience. In America, for instance, companies face a loss of $136 billion due to customer churn every year. Churn is costly for businesses, but it boosts customer retention when you can deliver a great customer experience and satisfy your customers.

Reduced Cost
Companies spend so much money on the marketing of their business. But satisfied customers are your brand ambassadors. When they share their experience with others, they promote your brand in the marketplace free of cost. 74% of the customers agree that word-of-mouth is a key influencer in their purchase decisions. So customers’ positive reviews and word-of-mouth recommendations lead to more business without investing in marketing and promotion.

Setting up and paying for a Feedback app may initially seem like an added expense for your business, but in the long run, it will equip your team with useful feedback data that can make it profitable. When you collect feedback, take action to boost your customers’ satisfaction levels; they will attract a lot of other customers into your business and ultimately boost your business growth.

Competitive Advantage in the Market
When you work to enhance customer satisfaction, customers notice it and compare your actions with your competitors. When they feel that you are doing a better job than others in terms of satisfying their needs and expectations, they prefer your brand over your competitors. This helps you gain a competitive advantage in the market and you emerge as a reputed brand in the market full of competition.

While the main motive of any business is to gain more and more profits, the key to profit maximization is customer satisfaction. If you want to maximize your profits, you need to work to provide great satisfaction to your customers as Customer Satisfaction drives better results for your business.