Research: Satisfaction & Loyalty
Introduction
The total consumer journey can be examined across three stages:
(1) expectation,
(2) engagement, and
(3) experience.
While consumer perceptions are formed throughout the total experience, it is the consumer's expectations that can have the greatest impact on engagement and subsequently on the experience. A consumer judges how closely the total experience met his or her original expectation in the dynamic path to purchase. The closer an expectation is aligned with engagement and the total experience, the more likely the consumer will be satisfied at a high level and become a loyal customer of that brand.
Successful brands understand that each dynamic path to purchase is an opportunity to:
· satisfy a consumer’s needs and wants;
· meet a consumer’s values and efficiencies; and,
· meet a consumer's expectations so closely that it will result in his or her satisfaction, loyalty and repeat business.
Consumer satisfaction is linked to how closely a brand meets a consumer's expectations during the consumer's engagement with the brand to fulfill a want of need. Thus, satisfaction is an important metric used to evaluate how closely a brand comes to meeting expectations. Moreover, a satisfied consumer is more likely to become a loyal customer which translates into repeat business as well as being an advocate (i.e., an influencer) for that brand. The goal is not to meet expectation, it is to exceed expectations!
Read the Article - Customer Expectations Hit All-Time Highs (Salesforce Research)
The link that follows is an article that summarizes changing consumer expectations using a 360 viewpoint. It will provide you with some useful information for completing your first Micro Research Study and Forum Discussion. Click on embedded link below.
1. Reflecting upon your expectations when you made the decision to purchase [brand X product/service], what strengths did you associate with the brand and product/service?
RECORD CONSUMER'S STATEMENTS AFTER QUESTION. This is your RAW DATA. This means you have not analyzed yet.
Consumer 1:
Consumer 2:
Consumer 3:
Consumer 4:
Consumer 5:
2. Reflecting upon your expectations when you made the decision to purchase [brand X product/service], what weaknesses did you associate with the brand and product/service?
RECORD CONSUMER STATEMENTS AFTER QUESTION.
Consumer 1:
Consumer 2:
Consumer 3:
Consumer 4:
Consumer 5:
3. Reflecting upon your expectations when you made the decision to purchase [brand X product/service], what opportunities did you associate with the brand and product/service?
RECORD CONSUMER STATEMENTS AFTER QUESTION.
Consumer 1:
Consumer 2:
Consumer 3:
Consumer 4:
Consumer 5:
4. Reflecting upon your expectations when you made the decision to purchase [brand X product/service], what threats did you associate with the brand and product/service?
RECORD CONSUMER STATEMENTS AFTER QUESTION.
Consumer 1:
Consumer 2:
Consumer 3:
Consumer 4:
Consumer 5:
6. The text data THAT you gather from the consumers will be used to create a SWOT Analysis of consumer expectations toward the brand and product in STEP 7.
Below are some examples of the type of text data you might gather:
· expectations for great experiences fell short
· didn't have consumers best interest in mind
· treated like a number
· wanted personalized offers
· loyalty focused
· need to offer more choices
· tailored engagement
· no innovation
· offer many new products
· consistency across channels (online and offline
· experience did not match expectations
· low effort by brand to impress consumer
· concerns about data protection
· concerns about security breach
Step 6: Gather Quantitative Data - Interview: Part 2 CSAT & NPS (6 total points - 3 CSAT & 3 NPS))
After you complete the consumer interviews for the SWOT Analysis, your next step (6) is to measure consumer satisfaction and loyalty.
· You will be gathering qualitative data (numerical) not text data.
· You will be doing two measures using numerical scales:
1. level of satisfaction with the brand using CSAT as the measurement scale, and
2. loyalty to the brand's product/service using NPS as the measurement scale.
Measuring level of satisfaction (CSAT - Consumer Satisfaction)
Ask each consumer the following question:
What was your level of satisfaction with [brand X] when you purchased [product Y/service Z]?
Measurement Scale:
(1) very dissatisfied,
(2) dissatisfied,
(3) neutral,
(4) satisfied,
(5) very satisfied.
NOTE: When you see a [ ] you are to place your own brand, product, and/or service where the [ ] are.
Example of How to Ask the CSAT Question
Please answer the following question:
On a scale of 1 to 5 where 1 equals "very dissatisfied", 2 equals "dissatisfied", 3 equals neutral, 4 equals "satisfied, and 5 equals "very satisfied," how satisfied were you with [insert name if brand X product/service] when you purchased [ X ] (insert name of product or service)?
Example of CSAT Question that includes the Brand and Product
On a scale of 1 to 5 where
· 1 equals "very dissatisfied",
· 2 equals "dissatisfied",
· 3 equals neutral,
· 4 equals "satisfied, and
· 5 equals "very satisfied," how satisfied were you with the [ X brand] after you purchased your [ X ]?
How to Calculate the CSAT Score
The CSAT score is calculated using the two highest responses of 4 (satisfied) and very satisfied (5). The number of highest respondents (levels 4 and 5) are subtracted from the total number of consumer responses to the survey across all five levels of satisfaction.
The calculation is: Number of Satisfied consumer ( 4 + 5) / Total Number of Survey respondent X 100 = % of satisfied consumer
If you had 1,000 respondents and 400 respondents answered either a 4 or 5 on the survey, the calculation would be:
400 / 1,000 = .4 X 100 = 40%
This means that in this example the CSAT Score was 40% which is very low.
Measuring Level of Loyalty: How to Calculate Brand Loyalty (NPS)
NPS - Measures Consumer Loyalty
Question: "How likely is it that you would recommend [Brand X,] [Product Y/Service Z] to a friend or colleague?
Measurement Scale: not likely at all (0) . . . (1) . . (2) . . .(3) . . . (4) . . .(5) . . . (6) . . .(7) . . . (8) . . .( 9) . . . 10 (extremely likely)
NOTE: When you see a [ ] you are to place your own brand, product, and/or service where the [ ] are.
Example of How to Ask the NPS Question
Please answer the following question:
On a scale of 0 to 10, where 0 is "not likely at all" to 10 "extremely likely," how likely is it that you would recommend an [X Brand = Apple] [ Z product =computer] to a friend or colleague?
How to Calculate the NPS Score
The NPS Score is calculated by subtracting the percentage of Detractors from the percentage of Promoters. For example, you had gathered data from consumer responses to the question: "How likely is it that your would recommend [Organization X, Product Y, or Service Z] to a friend or colleague? Among the 1,000 respondents, you had 25% who were Detractors, 25% who were Passives, and 50% who were Promoters. You would calculate you NPS Scores by subtracting the Detractors from the Promoters.
50 (Promoters) - 25 (Detractors) = 25 (NPS Score)
What does this tell you? The experience that this sample of 1,000 consumers has very low (25%) potential for promoting your brand. There is an immediate need to determine what is causing this low score and to develop strategies to increase the Promoters.
EXAMPLE: How to calculate NPS for Your Sample
You have a very small sample of N = 5. You can calculate the percentages even for a small sample. See the following example. Since there are 5 consumers, each represents 20% of the sample. The first two consumers scored 9 - 10 which is a promoter and represents 40% of the sample. The next two consumers (3 & 4) scored 8 and 7 (Passive) so they are excluded from the calculation. The fifth consumer scored a 6 which is a detractor and represents 20% of the sample.
1 consumer scored a 9 (Promoter) (20 %)
1 consumer scored a 10 (Promoter) (20 %)
1 consumer scored a 8 (Passive) (20 %)
1 consumer scored a 7 (Passive) (20 %)
1 consumer scored a 5 (Detractor (20 %)
Equation to calculate NPS = 40 % (Promoters) - 20 % (Detractors) = 20 (NPS Score) - a very low score
Summarizing the CSAT & NPS Scores
1. Develop a statement about the sample's overall average CSAT using the CSAT formula.
· The data will be one number.
2. Develop a statement about the sample's overall NPS score.
· The data will be one number.
Step 7: Create SWOT Analysis
1. Use the qualitative analysis from Step 5 to create your SWOT analysis.
2. Insert the text comments from each consumer in STEP 5 into the quadrant associated into the four quadrants:
· Strengths,
· Weaknesses,
· Opportunities,
· Threats
EXAMPLE OF SWOT
Below is an example of a SWOT using text as data from the information the reading for this assignment. It offers examples of the how the data you collected can be organized into strengths, weaknesses, opportunities, and threats.
Step 8: Create 2 CSAT & 2 NPS Strategies (12 total points)
· 6 points Strategy 1 - Satisfaction + Driving Brand Loyalty
· 6 points Strategy 2 - Satisfaction + Driving Brand Loyalty
1. Identify the common themes within each quadrant area of analysis in your SWOT.
2. Use two themes to create two strategies that could improve consumer satisfaction with the brand product/service.
3. Explain how the each CSAT strategy you created could drive two strategies brand loyalty for that product/service .