Measuring Customer Satisfaction

In: Business and Management

Submitted By keiyetta
Words 834
Pages 4
The purpose of this paper is to investigate the application of measuring customer satisfaction and to demonstrate how colleges and university can enhance their existing processes for measuring the student satisfaction of their service provision. The basic goal of customer satisfaction measurement is objective quantification of subjective perception of consumers. The findings of customer satisfaction study can provide information on how to retain existing customers and attract new one. Customer satisfaction is tied directly to profitability. If your customers are happy, they tend to be loyal. And if they’re loyal they not only buy more, they refer other customers. Well-established research by Bain & Company found that, for many companies, an increase of 5% in customer retention can increase profits by 25% to 95%. The same study found that it costs six to seven times more to gain a new customer than to keep an existing one.
Customer satisfaction is the state of mind that customers have about a company when their expectations have been met or exceeded over the lifetime of the product or service. The achievement of customer satisfaction leads to company loyalty and product repurchase.
Identification of Best Practices
Today, competition is fierce, and customers have more options than ever -- a tough combination for smaller companies trying to gain market share. The Net Promoter score is identified as one of the best practices when it comes to measuring customer satisfaction. According to (Brown 2010), the net promoter methodology is used to measure how likely customers are to recommend a product or service to others. Based on a single question, "How likely are you to refer this product or service to a friend," marketers use a 10-point liker scale to determine whether customers are promoters or detractors of a given product or service....