What is customer satisfaction and why is it important?

Customer satisfaction communication

So, what is “customer satisfaction”? Why is it so important to build positive relationships with your customers? If your business gives good customer service, then it is to be hoped that your customer will feel satisfied and will choose to buy from you again. High-quality customer service has long been a corporate mantra and perceived enabler of growth. However, many firms pay lip service to it, so what really matters to today’s consumer, and can you measure it?


Satisfaction is by no means always driven by price: it is about value for money, the quality of a product, the service given and the business going that extra mile to ensure that the customer is happy.


  • Value for money
  • Quality of the product
  • Service given
  • Going the extra mile


It may also mean a flexible returns policy resulting in a small hit in revenue to ensure that the customer is happy. But analysis of business success strongly suggests that short-term losses are offset by business growth if great customer service is given and, just as importantly, seen to be given.


In today’s online world, with greater competition in a far larger connected community, it becomes imperative to measure the degree to which a customer is happy with a service, product, or experience. Customer satisfaction (CSAT) is often measured by a survey that asks how a customer feels with regard to their overall experience, with multiple choice answers commonly ranging from “highly unsatisfied” to “highly satisfied”.


Why is measuring customer satisfaction important?


If customer satisfaction isn’t measured, at-risk customers cannot be identified. These are the people who could potentially leave negative online customer reviews, a much-amplified version of localised peer feedback of days gone by. Conversely, happy customers cannot be recognised as potential referrers; an opportunity lost.


CSAT surveys can be used to identify and motivate dissatisfied customers away from “churning”; a business term for the departure of customers who could leave negative reviews or warn others about their less than stellar experience.

Growing companies often focus on customer success; this explains the barrage of CSAT surveys we now face; it is seemingly impossible to buy a product without being invited to send feedback but it is beneficial for all parties.


Measuring customer feedback

Satisfied customers will spread good reviews via word of mouth to family and friends and they’ll refer others. They will post positively on social media which will help to build brand reputation and fuel growth, for no additional marketing outlay.


It makes good economic sense to devote resources to retaining an existing customer rather than solely focusing upon acquiring new ones. Spending from repeat customers tends to be higher, as is that of referred customers.


In addition, positive customer testimonials attract new leads to a business, creating greater market confidence as people read other users’ impartial recommendations.


In the absence of metrics to indicate just how happy or unhappy a customer base may be, sales and marketing teams cannot adopt strategies to manage customer expectations. Business owners need data in order to forecast likely performance and to refine existing approaches.


Integrating CSAT


Sales, marketing, and product development teams use CSAT as an integral part of their interactions with customers. In practice, a company can integrate customer satisfaction into almost every customer-facing function.


If customer satisfaction is positive, this can be highlighted by sales teams during pitches. Negative customer reviews represent a catalyst for change, alerting the relevant teams when a product or service requires attention. Product or service management teams monitor CSAT in order to identify these issues, resolve them promptly, and improve the overall product or service.


Customer Advocacy Programmes can be created for satisfied users which will encourage them to advocate on behalf of a business. Many of these programmes reward customers who refer potential leads. They will in many cases benefit from incentives to join the programme, by way of thanks for good reviews and positive testimonials. This creates a long-term mutually beneficial relationship.


Ultimately, it may be stating the obvious, but the happier customers are, the better overall customer retention will be.

Today, businesses benefit from, but are, in equal measure, threatened by, the omnipresence and social media and online interaction. Successful businesses recognise that in order to manage this, CSAT must be an integral component in every customer journey and interaction with the business.

Written by

Nathan Preedy

Nathan has been with team.blue since 2005 and has a background in Technical Support. He is passionate about helping customers find the best product for them and use it to its full potential.