Customer satisfaction important in downturns and at predicting future profit

[phillip@ysatisfy]

Hi All

Researchers in the US have shown that there is a direct correlation between customer satisfaction and future success of a business. They found that companies with increasing satisfaction scores faired significantly better in the downturn last year than those with declining scores. Companies with increasing satisfaction scores only lost 30% of their market value, against companies with decreasing customer satisfaction which lost 57% value on average. That’s a huge discrepancy completely outweighing the investment needed to boost satisfaction scores, and is an important reminder we need to all focus on delighting our customers, even in the tough times of a recession. Here is the article: *Retail Stock Prices Correlate With*Customer Satisfaction: Study - 2/27/2009 10:57:00 AM - TWICE

I’ve created a practical guide on customer satisfaction on my website which you may find useful. Its aimed at helping businesses understand what is customer satisfaction, how to measure it, techniques to build it and also how to build your business around your most valuable customers. I hope you find it useful, feel free to tell me what you think or ask questions. Customer Satisfaction and loyalty, how to measure and its value for business; what is satisfaction by Ysatisfy

Cheers

Phill Hunt
Ysatisfy Customer Satisfaction Consultancy
www.ysatisfy.com

[PointandStare]

I don't understand why we should be 'nicer' to our clients just because times are hard.
We should treat them the same whatever the weather.

[Paul Simister]

I agree - we should go above and beyond expectations to help clients at any stage of the economic cycle...

but...

during recessions, customers will be more likely to switch for bad service whilst great service creates a barrier against any ideas of price shopping - "I may save 5% but I will probably gain a list of hassles and irritations"

[phillip@ysatisfy]

You're all absolutely right, businesses should always treat their customers well regardless of the economic situation; however its times like this when every business should take a detailed look at the level of service they are giving to customers. If you don't do this, the chances are decisions will be made which could adversely impact your business.

I am working with lots of small businesses at the moment who are facing big challenges and one thing this can precipitate is knee-jerk decision making which can have much more detrimental impacts on their customers service and therefore future viability of their business. Its a challenge to get businesses to realise the importance of taking time to review their customer needs before making decisions

cheers

Phill Hunt
Ysatisfy Customer Satisfaction and focus portal, a guide for business