You’ll tell two friends, and she’ll tell two friends, and so on: Measuring client satisfaction to retain customers and gain new business

Cynthia CloskeyGeneral

From today’s Wall Street Journal: questions that measure real customer satisfaction by asking whether a customer would recommend your product or service.

  • How willing are you to recommend us to a friend or associate?
  • How would you rate our ability to meet your needs?
  • How would you rate our people?
  • How would you rate our processes?
  • What is your impression of our market reputation?
  • How would you rate the cost of doing business with us?
  • How would you rate the overall value of our product or service as being worth what you paid?

(Source: General Electric via “Client-Satisfaction Tool Takes Root” by Kathryn Kranhold, WSJ, July 10, 2006.)

The answers to these questions allow you to classify a customer on the “Promoter/Detractor” scale. Those who rate your company nine or 10 are promoters, seven or eight are passives, and six or lower are detractors. Subtract the number of detractors from the number of promoters to get your “Net Promoter” score. Then use qualitative feedback to improve your internal processes, with the goal of increasing your Net Promoter score.

It’s important to note that you need both quantitative feedback (the numeric survey results) and qualitative feedback (customer comments that explain the thinking and feeling behind the numeric scores). Using quantitative feedback alone leaves you scrambling in the dark, trying to improve numbers without knowing where they came from; using quantitative feedback alone leaves you without a way to measure improvement.

A client of ours, The Client Builders, has built an esteemed consulting business around a similar feedback and improvement model. Time and again they’ve discovered that asking your customers what they like and don’t like about doing business with you uncovers hidden troubles and opportunities — and even better, that the result is typically a stronger client relationship. The Client Builders have an added asset in their independent status: Clients find it easier to talk about problems with a disinterested third party.

Whether you use surveys (written, telephone, or online), interviews, or any other feedback meachanism, it’s critical to follow up on results throughout the organization. Basing management incentives on Net Promoter score is one excellent example: The incentive is unambiguous and the underlying metric is within manager influence but hard to manipulate.

Don’t fear customer feedback. Whether it’s positive or negative, it can only make your company mroe competitive.