The concept of customer satisfaction may seem simple: make customers happy, then keep them that way. Understanding what makes and sustains customer happiness is a key success factor for businesses. In general, customer satisfaction is how a customer feels about a product, brand, or business.
What is customer experience, and how does it affect customer satisfaction?
Customer experience is the summation of what customers encounter when doing business with retailers—from initial acquisition to completing a purchase and all touchpoints in between. Customer experience includes advertising and marketing, websites, social media channels, in-store merchandising, and branding across all in-person and online channels.
Providing a great customer experience with consistency in branding, communications, and products across all physical and online channels builds brand recognition and increases consumer trust and loyalty. With the increase in social media visibility, many businesses are aware of the importance of providing a great customer experience.
A reported 81% of marketers say they are competing with other businesses mostly on customer experience and 73% of consumers say a good experience influences their brand loyalties. On the other hand, the main reason customers shop with competitors is that they don’t feel appreciated by a business.
The Cost and Risk of Continuously Replacing Unhappy Customers
Expecting customers to keep purchasing from your business without continuously making an effort to ensure a good customer experience creates higher customer churn rates. Customer churn is the practice of acquiring new customers to replace existing customers who decided to shop elsewhere, often because they don’t feel appreciated.
Acquiring new customers to boost or bolster sales revenue is common for retailers. However, constantly acquiring new customers to replace lost business increases customer acquisition costs for marketing and outreach. With too many customers deciding to shop elsewhere, a retailer who is constantly acquiring new customers—without making sure current customers are happy—risks having to confront more negative feedback in internal and external reviews, social media posts, and negative word-of-mouth. Increased negative feedback can lead to a higher incidence of lost sales revenue.
Most customers who respond to customer service surveys rate customer experience as more important than the dollar amount spent on the products they buy. In fact, 46% of customers said they do more business with online retailers that provide exceptional customer service.
How to Find Out Whether Your Customers are Happy
Retailers can check review websites and social media channels to find out what their customers think. It’s also easy to set up Google Alerts for brand names, products, and other keywords so Google sends you an email every time its search engine indexes the words you set as alerts. However, relying on indirect data may not provide a complete enough picture of customer satisfaction or identify problems soon enough to be addressed before negative perceptions are created and business is lost.
Calculating a Customer Satisfaction Score
Retailers who want to find out how many of their customers are happy can calculate a Customer Success Score. Depending on the type of business, there are different equations to calculate customer satisfaction over time, by market, product type, and marketing campaign.
Here’s a basic Customer Satisfaction Score calculation that tells you what percentage of your customers are satisfied:
The drawback to calculating a basic Customer Satisfaction Score is that there’s no context for understanding why customers are happy or unhappy.
Customer Surveys and Questionnaires
Some retailers ask customers to complete a survey to understand more about their purchasing behavior. Surveys can provide useful information for businesses to address problems, plan for future product releases, and market their products. Since questionnaires can become lengthy, some retailers offer discounts on future purchases, giveaway drawings, or gift cards as incentives to have their customers complete them, often by answering them online or by email.
Here are some examples of information that businesses can gather with customer surveys:
- Level of satisfaction after purchasing a specific product.
- Length of time using the product.
- Whether a customer would make a repeat purchase.
- How the customer feels about the brand.
- Whether the customer would recommend the brand or product to others.
A drawback to gathering customer survey data is that questionnaires can provide incomplete or inaccurate information. Sometimes the right questions aren’t being asked, or written comments are missed.
How Live Sales Can Increase Customer Satisfaction
Retailers who take a more direct approach to checking on customers by asking how they feel during a live-selling session are rewarded with instant information that they can act on immediately. There are several advantages to finding out whether customers are satisfied during a live stream:
- By immediately addressing and solving their issues, customers perceive the retailer to be proactive and appreciative of their business.
- Businesses can more quickly make changes to products, pricing, or marketing communications from information gathered during a live-selling session.
- The direct connection to customers helps retailers build trust and credibility.
Levels of Customer Satisfaction
Satisfaction occurs when a business meets a customer’s expectations, but that’s the lowest rung of the customer satisfaction ladder. Businesses can encourage stronger loyalty and repeat sales by achieving customer satisfaction at all levels of customer engagement, and striving for the highest levels with every sale:
- Meeting customer expectations.
If you meet customers’ basic expectations relating to products matching advertised features, pricing, availability, and fast shipping, they’ll likely respond favorably to your request for a positive review. The customer who is able to find and purchase the right shoes in the right color with a decent fit may be happy. However, they might still decide to shop with your competitors because you haven’t earned their loyalty.
- Exceeding customer expectations.
Imagine fulfilling a last-minute holiday shipping request for a customer who was trying to make the cutoff and how grateful they’d be that you helped them. Were you and your customer service staff friendly to the customer? How quickly did you answer their questions and help them find what they were looking for? How fast was your shipping? Did you follow up with a personal phone call, text, or email to ask how they liked their purchase? All of these positive customer service attributes help to start building customer loyalty because they set your business apart from competitors.
- Delighting customers.
Did you go out of your way to find what your customer requested and make sure they were satisfied with their purchase? If a customer has contacted you with a specific apparel size request because they’re concerned about how an item might fit, and you explain how they can take their measurements correctly to ensure the best fit, then you follow up after they received the item to ask if they were happy, that’s going the extra mile! Many customers appreciate it when retailers make a noticeable effort to accommodate them. This is a great way to strengthen customer loyalty. They’ll also start seeking out and trusting your recommendations because they feel you’re looking out for their best interests.
- Amazing customers.
You’ve reached this level of customer satisfaction when you’ve exceeded your customers’ expectations and delighted them. As an example, a customer could be amazed when you go out of your way to order a single item of an out-of-stock product in their size and color, and then make sure that it gets delivered in time for a very important occasion. Then you call to make sure they received it and that they like it.
Live Selling Tips for Amazing Your Customers
The most successful live sellers know that being authentic is the best way to keep their customers engaged. Here are some helpful tips to use live selling to find out whether your customers are satisfied and to create more positive customer experiences for them:
- Be welcoming and friendly.
- Go live on a regular schedule every day or every week, and make time during each live stream for addressing customer concerns directly.
- Speak to customers individually and address them by their names.
- Ask open-ended questions that create conversations.
- Address problems proactively so customers leave the live-selling session with the knowledge that their issues will be resolved.
When retailers take an interest in how their customers feel, they reduce customer churn by increasing retention rates among existing customers. By understanding what makes their customers happy and striving to amaze them, retailers can become more successful by reducing customer acquisition costs while increasing sales and profit margins.
Asking what customers think during live-selling sessions reduces the time it takes to understand and address their issues and helps build trust and credibility. Retailers who interact individually with customers to learn about their purchasing experiences during a live stream also gather valuable actionable information that can contribute to their long-term success.