Here’s What’s Driving It, and How You Get in the Driver’s Seat
Ah, Customer Satisfaction.
The soft metric that bites hard. Especially in B2B, as we are not blessed with oceans of prospects and customers. Long-term B2B success is inextricably tied to the human relationship. You might treat customer sat as soft. Your customers do not.
Each and every customer is more important to the bottom line, especially as a B2B company moves along the arc of maturity and focuses more on profitability.
The mantra for long-term success is happier customers that stay longer and buy more. Longevity varies directly with customer sat. All other indicators aside, customer sat is the pulse of the relationship, of your current and future profitability.
What’s driving these customers?
What makes them happy? What makes them sad? What is it they want from us anyway?
Drivers of Customer Satisfaction + Category Leadership, from SaaSletter, recounts their survey of 4,222 software companies. After 50 regression analyses they identified 6 factors that have a meaningful correlation with Net Promoter Score (NPS) results. That means, here’s what customers are looking for. The factors are, in order:
- Quality of support
- Meets requirements
- Ease of doing business
- Ease of use
- Ease of setup
- Product direction
I would add to their list
- Price / value
I would submit that these are table stakes.
This report also points out that older companies have a harder time with these factors, largely as a byproduct of having more iterations or releases of their product or platform. Large companies may lack the agility to easily “turn the container ship” to address emerging or embedded customer service concerns.
There’s nothing surprising here, but what I find interesting, and absolutely correct, is these factors are mightily influenced by perception, emotion, and personality. Said differently, customer satisfaction means emphasis on people.
As a company matures, profitability matters most. Customer sat is the tide that lifts all boats, or not. It’s no wonder that many service organizations have built entire playbooks around serving core audiences.
It’s all about making your customers successful, personally and professionally, and seeing great value in your contribution to that success.
ICP Who?
There is one powerful variable in all of this. Who the heck are we satisfying?
It makes sense to increase customer satisfaction, and it makes better sense when the profile of those customers is ideal, or at least consistent with the cohort of your best customers.
You may have heard of ICP, the definition of which, in practice, varies from Immediately Converting Prospects to Ideal Customer Profile. In between it might be Insane Clown Posse.
The arc of a company’s maturation begins with the urgent need to get paying customers in the door. Further along this arc, the focus turns from new money to old, from top line to bottom, from revenue to profitability.
Back to the arc. Customers come and customers go. We want to better understand those that stay the longest and buy the most. Developing a profile of these good folks – not just of the companies’ firmographics but of the humans who participate – is fodder for marketing and sales. Let’s go get more of them.
Prospecting per your ICP may increase your cost of acquisition and lengthen the sales cycle, but it pays off when you need it the most, the long term, in profitability.
Measuring Customer Satisfaction
There are 4 methodologies that matter to determining customer satisfaction, all of which are survey-based:
- Net Promoter Score (NPS)
- Customer Satisfaction Score (CSAT)
- Customer Effort Score (CES)
- Product-Market Fit (PMF)
All utilize Likert scale questions which are easy to understand, easy to implement and provide quantifiable data. Respondents are asked to indicate their attitude, opinion, or behavior according to a predetermined range or rating scale where the lowest number indicates disagreement and the highest agreement.
Net Promoter Score (NPS)
I’m going to focus on NPS and how, with some experimentation, it has turned into a powerful mechanism for understanding what’s really going on, and what our customers expect of us; that is, what we need to do to maintain and boost their respect, involvement, and business.
The foundation of the NPS mechanism is the question, “would you refer us?”
The premise is that a referral carries a personal endorsement. Therefore, the customer must be quite satisfied to agree to a referral.
Customers are asked to respond on a scale of 1 – 10, with 1 being the lowest and 10 the highest. Responses of 9 – 10 are categorized as “promoters”, 7 – 8 are “passives”, and 0 – 6 are “detractors”.
The NPS methodology is best applied to longer-term planning – which is enormously useful, but when paired with qualitative research we get the opportunity to ask, “Why?” and probe their experience and views for each of the factors driving customer sat, and a lot more. You get perception, emotion, personality.
This combination of disciplines provides a longer-term, holistic view of the elements of customer satisfaction, and of loyalty. And the specific steps to remedy underperformance.
“Your most unhappy customers are your greatest source of learning.”
— Bill Gates, Microsoft
This would be a great business if it weren’t for all these annoying customers
How do you get in the driver’s seat with Customer Sat? You don’t. You ride shotgun. I’ve got a few ideas that may help. Note: these ideas are top down. Nothing happens bottom up.
- First, common sense. If your customers are succeeding, they’ll stick around, if you solve more of their problems, they’ll buy more. You need to measure yourself by their metrics. Incent based on achieving their goals.
- Second, get personally involved. Be a customer experience rep for a day. Take calls, answer messages, conduct meetings, and resolve issues. Get into the give and take of the everyday, up to your elbows.
- Last, get up and drag your sorry ass out to see them. I mean see them, take a walk, get in the car, board an airplane. Be there now and break bread.
When Lou Gerstner took over as CEO of IBM, he was AWOL from HQ for the first few weeks. Where’s Lou? He was out seeing customers.
Be like Lou.
Form personal relationships. Let them explain their company, their values, their aspirations to you, face-to-face. What do they need, how can you help? Become a part of their team.
What does customer satisfaction, as a driver of long-term profitability, look like?
I was interviewing a C-suite decision maker of one of the best customers of the company sponsoring the research. I asked him, “What is the most important benefit you receive as part of being a customer?”
His answer was short and direct, “Our salesman. He’s part of our team and helps us to solve problems. He knows what we need and goes out and gets it.”
Be that salesman.
This article was originally published by @MarTech Today.
About the Author
International author, lecturer and consultant, Scott Hornstein has worked with clients in all phases of marketing strategy, research, and implementation. He has worked with companies large and small to build profitability, by improving marketing performance, and reengineering the customer experience to boost satisfaction, referrals, and customer lifetime value.
More great articles by Scott Hornstein:
- AI’s Competitive Advantage is Not What You Think
- Marketing L&D isn’t funny. But should it be?
- Make ‘Em Laugh: The Power of Humor in L&D
- The customer is not a moron. She’s your wife.
- Do learning engagement and retention suffer as screens get smaller?
- Maximizing AI for Content Marketing Success in Training and Learning Tech Companies