Six reasons why organizations should maintain a high levels of customer satisfaction

Researchers have found there is a relationship between the degree of satisfaction achieved, and the level of customer retention or loyalty.  Merely achieving customer satisfaction, however, is not enough.  There are many other benefits of satisfying or delighting customers.  Among them are:

  1. Encourages repeat patronage and loyalty
  2. Enhances/promotes positive word of mouth
  3. Lowers cost of attracting new customers
  4. Reduces failure costs
  5. Can create sustainable advantages
  6. Insulates customers from competitors

Disconfirmation of expectations model of satisfaction

  • Other influences on satisfaction evaluations (prior attitudes, attribution theory, equity theory)
  • Types of expectations
  • Desired (ideal)
  • Equitable (deserved)
  • Predictive
  • Adequate (minimum tolerable)
  • Managing customer expectations and the zone of indifference
Service Quality versus Satisfaction
  • ‘Service quality’ means different things to different people
  • Parasuraman et al define it as:

 “Consumers’ judgement (across multiple service encounters) about the brand overall excellence or superiority… it is a form of attitude, related but not equivalent to satisfaction”

  • Dimensions of satisfaction and service quality
  • tangibles
  • reliability
  • responsiveness
  • assurance
  • empathy
  • The ‘Gap’ model of Service Quality
  • Building a service satisfaction information system
  • Service guarantees to be effective, should ideally be:
  • unconditional
  • easy to understand and communicate
  • meaningful
  • easy to invoke
  • easy to collect

Measuring satisfaction (and Service Quality)

  • Qualitative research methods
  • focus groups
  • one-on-one interviews
  • Critical Incident Technique (CIT)
  • laddering technique
  • Quantitative research methods
  • understanding the key ‘drivers’ to measure
  • questionnaire structure
  • question wording

One of the keys to successfully measuring satisfaction (quality) is drawing a tree diagram showing the hierarchy of drivers of satisfaction, and how these are linked to internal service standards.

Examples of the actual wording and structure of questions to measure expectations, quality, satisfaction, perceived performance and disconfirmation are then shown.

Concluding Notes

Researchers might be encouraged to mention other factors that might impinge on this process such as prior attitudes, attributions, mood states, level of personal involvement and perceptions of fairness or equity.

In each case these factors might potentially act as either a moderator (intervening variable) between disconfirmation and satisfaction, or as a moderator variable (i.e., it alters the nature of the relationship between disconfirmation and satisfaction).

Finally, it is worth noting the ‘ratchet effect’ i.e., according to this model expectations must be continually exceeded if satisfaction is to be achieved.  In doing so the firm inadvertently sets a new (higher) standard each time.

That is, it raises the bar or the base level of expectations and so (theoretically) on each new purchase occasion the customer will expect the firm to meet or exceed the new (higher) standard.

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