Many organizations track customer satisfaction using indicators such as Net Promoter Score or Customer Satisfaction Score. Why is it important to measure satisfaction? High satisfaction typically translates into repeat sales, strong word of mouth and positive recommendations. It also requires fewer resources to sell additional products and services to satisfied customers than it does to acquire new ones. And while it might take months or even years to add a customer, it takes just seconds to lose one.
If you have not tracked satisfaction, you may consider a repeat purchase or a membership renewal as proof that customer satisfaction is, well, satisfactory. These are indicators that if there is dissatisfaction, it seemingly is not affecting purchase decisions. But that does not mean all customers are satisfied and loyal.
It is possible some customers are only somewhat satisfied or slightly dissatisfied. The first time they see a better alternative, they may make a switch. Some customers could be continuing to buy out of habit, or because the idea of changing providers seems time-consuming or difficult. If their dissatisfaction rises above the pain of changing, however, they will move on.
Consider research we conducted for a credit union. We asked account holders if they already had their next choice in mind in case, they decided to switch financial institutions. Overwhelmingly, they did. In a variety of industries, we often find a company’s customers, even those who are somewhat satisfied, occasionally purchase from our clients’ competitors. Keeping your customers highly satisfied is key to protecting your share of your wallet and increasing it.
Going beyond simple scores with Kano analysis
Tracking satisfaction with a standard score is a start. It can alert you to potential issues. It also allows you to compare your score against others in your industry. These opportunities are great, but to learn which factors are contributing to your customer’s satisfaction or dissatisfaction—and to what degree—requires deeper research.
Kano Model analysis is a powerful tool to help clients understand what is driving their customers’ satisfaction. Kano Model methodology consists of asking about a user’s overall satisfaction, the importance the user places on various attributes of the product or organization, and the user’s satisfaction with each of those attributes.
The analysis examines correlations between the importance and satisfaction of each attribute to the customer’s overall satisfaction. The deliverables provide many insights, including:
- Factors you need to satisfy adequately to be considered an option in the buyer’s mind
- Factors that are critical to your organization being successful in the competitive landscape
- Factors that will delight the customer and strengthen satisfaction
- Factors that are relatively less important to satisfaction
- Where gaps in satisfaction exist, as well as which ones should be addressed first
- Where improvements will have the most impact on overall satisfaction
Kano Model analysis provides a blueprint for how to improve. It guides decisions regarding:
- Allocation of resources to areas that will most move the needle on satisfaction
- Development of marketing to focus on factors most correlated to satisfaction and to leverage dissatisfaction buyers have with your competitors
- Improvement of customer experience and customer support programs
- Refinement of brand identity and competitive position
- Direction for sales teams
The Kano Method has other strengths. Beyond including your customers, you can conduct Kano analysis on customers of key competitors to provide valuable insights into your competitive position, as well as identifying market challenges and opportunities. With a sufficient sample, Kano results can be examined via demographic, attitudinal, or behavioral sub-groups. One of our business services clients looks at primary customers vs. secondary customers, the customer’s role in purchasing, and the size of the customer’s company. Another client in a consumer market segments its Kano results by age, household income and household size.
There is a rich range of actionable data you can reap from a well-designed Kano Model exercise. If you’re interested in deeply understanding customer satisfaction, consider getting more than a single score.
Linda Kuster is president at Vernon Research Group, based in Cedar Rapids.