The Irresistible Rise of C-Sat

Customer satisfaction is rapidly emerging as the most important and powerful competitive advantage for successful businesses. From higher profits to increased productivity, an effective C-Sat strategy delivers straight to the bottom line.

The importance of C-sat

There is an old Chinese proverb that says, ‘a man without a smiling face must never open a shop’.

Ancient oriental wisdom may seem a strange place to look for guidance on one of the biggest challenges facing businesses in the 21st century. But, as with many proverbs, it expresses a fundamental truth very succinctly. Customer satisfaction, or C-Sat in management parlance, is rapidly becoming not just a key differentiator for competitive businesses but perhaps the key differentiator. In fact, in a recent survey into digital trends in 2018, C-Sat was rated as the most exciting business opportunity for companies, ahead of mobile, social and personalisation.

Everyone has had experience of the surly shopkeeper: offhand, unfriendly, not meeting the customer’s eye, uncommunicative, begrudging them the time of day. The reaction to such treatment is generally the same. We will avoid that shop if there is an alternative and, if we do return, it will be seldom and reluctantly.

Because what the smiling shopkeeper realises is that the actual purchase is only one small part of the transaction. It is the overall experience that matters. That experience leads to repeat business and recommendations to friends.

It is not so very different at corporate level in the 21st century. The UK Institute of Customer Service offers some very consumer-friendly definitions of satisfaction and experience.

What is ‘C-Sat’?

According to the Institute, customer satisfaction is a measure of the degree to which a product or service meets customer expectations. Put more simply, it measures how happy customers are with your product, your service, and their overall experience of dealing with your organisation. Customer satisfaction emerges from a corporation-wide culture of being the best you possibly can be. It’s not okay to be just okay.

The experience is the sum total of every interaction that the customer has over the course of their relationship with the supplier – from first discovering them to follow-ups after the transaction is complete. Knowing whether you fall short of expectations or exceed them is of vital importance to your organisation’s profitability and even survival.

Make or break

Great customer satisfaction is achieved when customers consistently get a flawless product or service, delivered by caring, friendly people, in a timely fashion supported by an effective and efficient problem resolution process.

When this doesn’t happen, customers vote with their feet. They cancel services, switch providers, change suppliers and they share their negative experiences. That hurts business revenues, profitability and employee turnover.

One of the big challenges around customer satisfaction is that it seeks to measure an emotional response from an individual. It is subjective and based on personal perception and expectations. That doesn’t sit well with traditional number-crunchers, accountants and statisticians.

But C-Sat can provide insight into that expectation management. And it can put hard numbers to the impact that emotional response is having on the company’s bottom line.

Customer satisfaction is rapidly becoming not just a key differentiator for competitive businesses but perhaps the key differentiator.

The bottom line

A growing body of evidence, including research from the Institute, indicates a clear link between customer satisfaction, employee engagement and the financial performance of an organisation over the long-term. This is a metric that is worth taking seriously.

According to the Institute, those organisations that consistently deliver higher levels of customer satisfaction over an eight-year period consistently outperform their sector both in productivity and profitability.

Companies with higher levels of customer satisfaction than the average for their sector have an EBITDA (earnings before interest, taxes, depreciation, and amortization) that is over 10% higher than those with lower than average customer satisfaction1.

Better still, figures from the Institute reveal that revenue per employee at companies that do C-Sat well is a staggering 114% higher than for those that underperform. Human capital value-add at the better-performing companies is 47% higher.

The Institute also identifies the strong link between employee engagement and customer satisfaction: for every 1% increase in employee engagement, there is a commensurate 0.41% increase in customer satisfaction.

Organisations that are brilliant at delivering customer experience also get significantly higher levels of recommendation, higher levels of trust and higher levels of repeat business.

1 Source: Institute of Customer Service Dividend Report 2017

Keep it consistent

Achieving those results is a function of having a robust C-Sat strategy in place. Companies at the forefront of excellence in C-Sat typically focus on the five aspects of experience that are most important to the customer:

  1. Is the customer interacting with competent, knowledgeable and engaging people?

  2. Is it easy for the customer to do business with us across all channels, online and offline?

  3. Was the customer’s actual product or service experience outstanding from first contact to execution and beyond. Did it do what they expected it to do?

  4. In the event of a problem or complaint, how well was it handled and how was the customer made to feel? Was it a positive outcome?

  5. Did everything happen promptly, efficiently and on time?

The best C-Sat companies aim to offer a consistently high standard of experience across all channels. The so-called omni-channel approach means ensuring that all channels – from digital and social to telephone and face-to-face – are properly aligned and integrated. It’s not enough merely to offer multiple channel choices that exist in silos.

Customers want to know that the information they share online will be captured and acted on when they later speak on the phone to customer services. Duplication and repetition do not make for a good customer experience.

Offer genuine choice

A C-Sat focus means that the preferred channel is chosen by the customer, not by the organisation. Trying to force customers down one particular channel is one of the quickest short-cuts to a poor customer experience and dissatisfaction.

The evidence of a persistent link between high C-Sat scores, turnover growth and employee productivity, is compelling. Many of the UK’s leading organisations explicitly recognise the role of customer experience and employee engagement in delivering sustained performance.

Combining people, technologies and processes to offer accurate, relevant information and empathetic help and advice, are now the defining tests of superior customer experience and satisfaction, especially in the context of the omni-channel environment.

The example of the smiling shopkeeper is one that the best companies already follow. The smiling shopkeeper has happier customers and prospers accordingly.


The Metrics of Customer Satisfaction

We look at the tools and techniques that capture customer satisfaction and turn it into powerful strategic insights.


The DNA of C-sat Champions

We look at the traits that separate C-Sat superstars from the also-rans.


The Next Generation of C-sat

The best C-Sat companies are raising their game not only to meet but to exceed their customers’ higher expectations.