By Andrew Dalglish - 26th February 2011
In my last post I put forward the idea that every business should measure its performance against a stakeholder ‘Happiness Index’ with a particular focus on customers. As the customer’s voice within the organisation, responsibility for this index lies at the marketer’s door.
Before we go any further I’d like to challenge the received wisdom that it’s commercially sensible for every business to invest in enhancing customer happiness. This isn’t always true and there are two notable exceptions.
The first are businesses in sectors where demand persistently outstrips supply. The second are businesses who have a compelling, sustainable and unique source of competitive advantage. For example, Ryanair enjoys strong year-on-year passenger growth but customers frequently complain about the Ryanair experience.
Most of us though have good reasons to be concerned with customer happiness. Replacing those who defect is expensive, future sales are further damaged through negative word-of-mouth and a transient customer base makes the business a less attractive investment proposition. Let’s also not forget our own personal pride and the morale of those around us. After all, no one wants to work for the bad guy.
The basis of the index is a customer survey. As standard, this should include three core metrics which gauge overall happiness levels – satisfaction, loyalty and propensity to recommend. The best indices then go one step further. They provide guidance on how to improve overall happiness by identifying specific behaviours which have the greatest impact and measuring performance against these.
The second step is to survey customers in an appropriate and objective manner. Typically this will be through a series of short, structured interviews. Strategically important customers might also be surveyed in greater depth to signal your commitment and obtain deeper insight.
Finally, maximise the impact. Create a management dashboard to ensure Board level visibility and gain support for action. Cascade results throughout the organisation in an easily digestible format to foster cohesion and help develop a customer-centric culture. Hold workshops with customer facing colleagues to ensure they understand expectations and are properly equipped. And if you really want to move the needle, link bonus payments to customer happiness.
Read more about our approach to business-to-business (B2B) customer satisfaction surveys.
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Andrew has specialised in B2B research for over a decade and co-founded Circle Research in 2006. He is a columnist for B2B Marketing Magazine, a regular contributor to Research Live and frequent speaker at leading events such as the B2B Leaders Forum, Customer Experience Live and the Social Media World Forum. Andrew is a Chartered Member of the MRS, teaches the MRS B2B research course and holds an MA in Psychology from Aberdeen University alongside an MSc in Marketing from Strathclyde University.