Search

Satisfaction vs. Loyalty

D'Anne Harp
Jul 22, 2015
2 min read

“Can I ask you to take a 5 minute survey concerning your satisfaction with your service today?”

Right there, do you feel motivated to spend more time with the company? How many times do you say yes vs. no, and why?

My guess is, you may only respond if your service was extremely positive or miserable, and this skews the data results. How and when you collect the data, and the phrasing of the questions you ask has everything to do with the quality and validity of your results.

So let’s take a good look at the satisfaction construct. The last 10 years or so, companies like JD Powers and NPS have made a business out of measuring satisfaction, and it’s been a good one for them. Even in my career as a user experience guru, I’ve requested that we use their systems, and I’m certain I’ve used Customer Satisfaction as an inspirational poster child value, in hopes it might inspire a developer to follow the designs laid out with that supporting intent.

However, do the satisfaction metrics really tell the whole story? Does satisfaction have a value attached to it, such as profit margin per customer contact point, or loyalty that drives future purchases or upgrades?

Putting it another way, even if you are satisfied with your interaction with a customer service agent, is that any predictor that you want to speak with that customer service agent again? No, because you would rather be using the product than talking to customer support. All too often, the customer support agent must bear the brunt of a number of company missteps that have nothing to do with their skills, character, or knowledge.

And from the consumer product perspective, just because you are “Satisfied” with an email or other application, is that any indicator that you will stay with that application, if there is a competitive product that is easier to use?

Satisfaction does not seem like the sole—or best metric then. Why then, do we put so much stock into Satisfaction metrics, and is it really giving us the information we need regarding the customer/product/brand experience in order to shape anything other than how well the customer service agent was able to handle your questions and requests?

According to studies done by Corporate Executive Board (CEB), they found a weak relationship between satisfaction and loyalty, when it comes to repurchasing or upgrades. They found that the greatest predictor of loyalty was level of customer effort for making the purchase or customer contact point - and this to me implies level of effort to accomplish critical tasks within the product itself.

Check out these numbers:

Of customers who repurchased:

94% were Low Effort Customers
4% were High Effort Customers

Of customers who repurchased with a higher spend

88% were Low Effort Customers
4% were High Effort Customers

Of note, CEB created their own Level of Effort composite index of the following variables, and I encourage you to think about using their system or developing your own within your organization. I find this compelling, and this can be extended across any business model or product line.