Let me be clear. It’s crucial to satisfy customers’ needs and preferences. It’s also vital to know how customers perceive your offering so you can pinpoint areas that need attention. But, C-SAT misses a critical piece of the puzzle. It doesn’t indicate customers’ intention to remain loyal to your brand. If they’re defecting, it doesn’t tell you why.

Studies show that customers can be reasonably satisfied with your offerings yet still switch away from your brand. In fact, they may be extolling your brand’s virtues even as they’re signing up with your rival. If they do intend to stay, C-SAT won’t tell you if they’re inclined to buy again. And, you can’t know if they’d prefer to get your service through a different channel. At best, C-SAT is a barometer of how customers perceive your brand based on their prior experiences with it.

Is Net Promoter Score the answer?

A newer metric, Net Promoter Score (NPS), is gaining steam. NPS is based on asking customers: “How likely is it that you’d recommend our brand to a friend?”  Depending on their answers, respondents are classified as “Promoters,” “Passives,” or “Detractors”.  But is NPS is any more predictive of customer behavior than C-SAT?

The answer is a resounding “maybe”. Whereas C-SAT tries to gauge the customers’ perceptions of experience, NPS measures their enthusiasm for your offering.  NPS takes aim at attitude which does tend to be more predictive of  behavior. But neither metric identifies the unique drivers that motivate customers to remain loyal and buy again so that you can take steps to influence their behavior.

Where these kinds of metrics create problems is that they give organizations a false sense of insightfulness.  Unfortunately, at a lot of companies, NPS has become the new C-SAT — a surrogate for customer insight. Like C-SAT, it’s relatively easy to collect and track over time. But many organizations are merely substituting a newer, shinier metric for the traditional, time-worn measure of service performance.  These businesses are being ill-served.

So, what’s the fix?

There’s no substitute for getting to know the people you serve. Enlightened companies engage in frank conversations  with a fair cross section of their customer base. They engage the people they’re serving as well as those they want to serve.  They talk with defectors as well as loyal customers. They ask purposeful, specific questions to understand customers’ attitude toward their offerings. And they listen intently.

Talking directly with customers is a golden opportunity if you make the most of it. Use every channel to foster genuine, two-way communications. Solicit and collect feedback before, during, and after the service experience. Make it easy for customers to respond. Ask specific questions and listen from the standpoint of  discovering new information.

Here’s a caveat: Recognize the limitations of customer feedback. For example, many people can’t readily explain their intentions, and many are prone to misrepresenting their perceptions. But these constraints don’t deter skillful  practioners from probing customers to learn what drives their loyalty and intention to repurchase.

Get involved.

Don’t rely solely on your customer-facing reps to gather feedback. Too many managers think they know what’s going on by perusing weekly feedback summaries. It’s vital to get personally involved, and to encourage your peers up and down the line to join you.

Surveys have their place if they’re well-crafted. Asking specific, purposeful questions in the proper sequence is key.  Comparing different surveys, using advanced techniques like conjoint analysis, can provide a dimension of information not available  through any single questionnaire. If you don’t have the know-how to do this, get sound 3^rd party advice.

Can you handle the truth? Engage in purposeful inquiry to uncover actionable insights — not to reinforce what you want to hear. Done properly, you’ll be amazed at what your customers know about your business that can guide you. My litmus test for inquiry is simple: If I’m not consistently discovering new things, I’m not doing it effectively or sufficiently.

Building relationships isn’t about achieving C-SAT or NPS scores. Talking with customers takes time and skill.  Purposeful inquiry requires more effort than tabulating survey scores. It’s worth it. If you’re genuinely interested in what drives your customers but rely solely on C-SAT or NPS scores as your basis for knowing, you’re probably paying a stiff penalty. Can you afford it?

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Want more on this subject?

My company, Osprey, specializes in helping global firms gain deeper insights about the people they serve. Our focus is on identifying loyalty and repurchase drivers. To read case studies or to get more info, please get in touch.  Let’s talk about your particular challenges and opportunities.

Suggested Reading:

Why Satisfied Customers Defect (’08 article) from Harvard Business Publishing.

Predictably Irrational: The Hidden Forces That Shape Our Decisions (’08 book) from HarperCollins.

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