Posts Tagged ‘customer insights’

The Myth of Customer Satisfaction

Thursday, April 2nd, 2009

It’s time to dispel the epic business myth about the importance of Customer Satisfaction (a.k.a. “C-SAT”). Lots of companies rely on their C-SAT scores to tell them how well they’re serving customers.  But many organizations substitute C-SAT tracking for talking with the people they serve. At these firms, C-SAT is their Achille’s Heel.

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.

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Clarifying ‘Analytics’

Monday, September 8th, 2008

Some comments I’ve received from readers indicate some confusion about what’s I mean by ‘analytics’.  Let me try to clear that up. At my company, we use the term to mean the approach to as well as the practice of mining and analyzing data as well as the tools and practices. 

Our practice is concerned as much about the human and organizational issues enabling the successful application of business intelligence and analytics. These include management vision and commitment, organizational alignment, culture, and skills. We’ve learned that buying “yet-another-tool” seems easier than solving these broader challenges, but it’s rarely the answer companies are looking for.

The most successful practitioners of analytics somehow manage to create an environment where decisions across boundaries are made on the basis of evidence that comes from rigorous analytics.  Management at those companies enncourages a “test-and-learn” approach to refine products, services and offers.  So analytics encompasses the tools and practices that produces insights as well as the way the company uses the insights to contour its offerings.  Hope this is helpful.