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Satisfaction, Schmatisfaction

Why your customer satisfaction numbers lie like a rug

I was at a large banking conference recently, listening to yet another VP tout their organization's customer focus: "So as you can see our satisfaction numbers are over 86% as represented by the checking of either the "mostly" or "completely satisfied" boxes in the survey." Forgive my yawn.

Is a baseline satisfaction measure helpful for identifying progress in your customer retention strategy? Sure, in the same way that I track my 13-year old son's satisfaction with his educational experience. Me: "So, Sean, how was school today?" Sean: "Huh? Oh, uh fine I guess."

The problem is one of both methodology and interpretation. By attempting to benchmark and quantify the quality of the experience over time, there must be strict parameters about how we gather customer feedback. We must contact a certain number of customers, ask closed-ended questions and check specific boxes. Nothing wrong with that, unless people in your business then use this incredibly limited perspective to make strategic decisions regarding customer experience.

Here's the danger: satisfaction has little to do with customer retention. In their insightful book, Managing the Customer Experience, authors Shaun Smith and Joe Wheeler found that 80% of customers who switch vendors express satisfaction with their previous vendor. 80%! It's just one more bit of evidence that the end game is not getting the right box checked on your latest satisfaction surveys.

Satisfaction equals, at best, inertia that - all other things being equal - won't knock a customer off your ship. But things are never equal: in your company, with the competition, your customers, or the world at large.

"Let me tell you about the bank that I'm mostly satisfied with!"

A quick example: Put yourself in a customer's shoes. If your bank offers comparable interest rates as everyone else, and the ATMs work most of the time, and the tellers don't sneer at you when you walk into the branch, are you relatively or completely satisfied? The answer is "probably." Are you going to stick with that bank even if their interest rates drop a bit? Maybe, maybe not. Are you going to tell friends about the bank if you are "mostly satisfied?" Probably not. What if you have just one bad service experience? What if you get mad? Will you tell anybody then? Research indicates you'd tell upwards of 15 people.

Going beyond satisfaction to trust and emotion

Still not convinced? A study, presented in CNN Money (June 11, 2004) ignored satisfaction and asked instead this more telling question: "Do you feel that your financial service company is working in your best interests?" The answers they received are, frankly, a little scary. The majority of customers replied that they did not feel like their best interests were considered. To make that clearer, let's look at one example: Citibank.

The survey says...22% of Citibank's customers felt that the company was acting in their best interests as customers. That means that 78% do not feel that Citibank is their advocate. Interestingly, the banks and insurers that scored higher in this survey were also growing faster than the industry as a whole.

The Pot of Gold

If you are that one bank that goes beyond satisfaction to something deeper and more profound, the rewards can be exponential. In an industry where, at the very best of banks, 10% of your customers leave every year, you stand to achieve dramatic improvements in not only retention, but also average revenue per customer, number of referrals, and ultimately profits by asking not "are you satisfied?" but rather "do you believe in us?"

William Cusick is president and founder of Vox, Inc., a customer experience consulting firm in Chicago specializing in helping financial service companies achieve better bottom-line results through an improved customer experience.

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