Increasing competition is forcing businesses to pay much more attention to satisfying customers, by providing strong customer service. Customer satisfaction matters not only to the customer, but even more to the business because it directly impacts a company’s bottom line profits. It’s not just about being nice to your customers, it’s about understanding how strong customer relationships are pivotal to a company’s success. Further, it is one of the most important components of a company’s positive brand image. The reason why customer satisfaction directly affects bottom line profit of the company is simple: it costs far less to retain a satisfied client than it does to find a new client.
Here are the reasons why customer satisfaction is so important
- Positive word of mouth
- Cross selling and up selling
- Show the willingness to care your customers
- Increasing Customer Retention
- It’s cheaper to retain customers than acquire new ones
Positive Word of Mouth
Positive Word of Mouth, the most powerful and cheapest form of advertising that can be contributed only by a satisfied customer. When a person is satisfied with a company or service they are likely to share their experience with other people to the order of perhaps five or six people. However, dissatisfied customers are likely to tell another ten people of their unfortunate experience.
Cross selling and up selling
Customer satisfaction is the best indicator of how likely a customer will make a purchase in the future. A satisfied customer will keep coming back to you for more services or products or a varied stream of services you provide. Cross-selling and up selling to clients who are already satisfied with your services is the quickest and most cost-effective way to bring in new business and grow your firm. Your clients already value your services, so if they have a need you can address, you’re well-positioned to sell more.
Show the willingness to care your customers
Customers like to be asked for their feedback. It gives the customer the perception that your company values them, is committed to keeping them as a long-term customer, and bases business decisions on your customer feedback.
Increasing Customer Retention
Avoid losing your customers by building relationships and keeping in touch using a rolling calendar of communications. Be in touch with your customers with a programmed sequence of letters, events, phone calls, “thank you’s”, special offers, follow-ups, magic moments, and seasonal greetings or notes with a personal touch etc. that occur constantly and automatically at defined points in the pre-sales, sales and post-sales process. People not only respond to this positively, they really appreciate it because they feel valued and important makes them feel part of your business so that they want to come back again and again.
It is cheaper to retain customers than acquire new ones
Customers cost a lot of money to acquire. You and your marketing team spend a lot from your pocket getting the attention of prospects, nurturing them into leads and closing them into sales. Customer acquisition, usually steals the spotlight, but retention is what ultimately builds the foundation of a company that is positioned for growth.
The effective use of a Customer Relationship Management software in any organization helps in minimizing efforts and hassle of spending your valuable time on customer relation and satisfaction. CRM software automates the process of tracking every interaction between a customer and a company representative.
Customer satisfaction plays an important role within your business. Not only is it the leading indicator to measure customer loyalty, identify unhappy customers, reduce churn and increase revenue; it is also a key point of differentiation that helps you to attract new customers in competitive business environments.