National Clothesline

Not many businesses today understand the link between customer satisfaction and profitability! If they did, they wouldn’t be so indifferent to their customers’ needs.

Three factors contribute to indifference.

The first is awareness. Customer satisfaction problems can be deadly. They grow within a company like a cancer, eventually strangling the life from the business. By the time owners recognize the problem, the damage is already done, and a reputation for poor customer service has become part of their brand identity.

The second factor is the length of time it takes to reverse a customer satisfaction problem. Changing common perceptions and entrenched consumer attitudes may take years and a considerable amount of money.

The third factor: too few cleaners make the effort to fully understand how customer satisfaction impacts their bottom line. Labor costs, production supplies and other line items are spelled out on balance sheets, but the benefits of customer satisfaction are often hidden.

There is an art and science to genuine customer satisfaction — a road map, if you will, to developing policies and processes that will maximize profits.

The science is the easy part because it can be found in the ROI a business gets from its investment in customer service.

The art of customer satisfaction is less easily defined and focuses on how cleaners use customer satisfaction information to their benefit.

True leaders in customer satisfaction, companies that demonstrate the ability to achieve high levels of customer satisfaction, are those that don’t just talk the talk, but walk the walk, each and every day. These companies share several key philosophies and processes that impact the way they do business with their customers.

Drawing the link between satisfaction and profits.

Understanding the difference between satisfaction and advocacy.

Identifying all customer touchpoints.

Recognizing the role of customer expectations in determining satisfaction.

Heeding the dangers of overpromising.

Building a culture of customer satisfaction from the top down.

Understanding the role of management versus the role of front-line employees in driving customer satisfaction.

Recognizing the importance of hiring the right people.

Empowering front-line employees to do the right thing.

Using problem resolution as an opportunity to build advocacy.

Building a community among customers.

Developing an infrastructure built around the voice of the customer.

Customer satisfaction is not an end goal in itself. It is part of a series of events that leads to an end goal. The process begins with “What your company did” that resulted in customer satisfaction (how your customer felt) and leads to customer behavior (what your customer did as a result.)

The biggest difference between drycleaners with high levels of satisfaction and drycleaners with low levels of satisfaction is that the customers of the low-satisfaction drycleaners were more likely to say they left because they didn’t like the way they were treated.

Customers can be divided into three groups based on their levels of satisfaction.

Group 1 contains the most satisfied, the ones who are completely committed to you and wouldn’t leave you under any circumstances.

Group 2 are relatively happy with their experience but are not emotionally attached to your company. To these customers, a drycleaner is a drycleaner, and it doesn’t really matter much where they take their clothes.

The last group are people who have experienced recent glitches in your service and are basically fed up with everything about you. These are people who will search out a competitor to fill their needs.

The likelihood that a customer will remain loyal is directly linked to the number of competitors to which your existing customers may defect. The easier it is for your customers to switch to another cleaner, the more likely they are to do so if you fail to meet their expectations.

Some factors that affect the probability of a satisfied customer remaining loyal are:

• Number of competitors.

• Frequency of use.

• Competitors’ advertising.

• Cost of your services.

• Use of loyalty programs.

The cost of switching, for the customer, is not so much an economic cost as it is the effort and risk associated with switching to a new or unknown cleaner. For them, it’s risky to switch cleaners when you don’t know anything about the alternatives. Customers are more likely to stay with a cleaner, even one that disappointed them in the past, if they have no way of knowing if the alternatives might be even worse.

Customers are more loyal to higher priced drycleaners than they are to discounters, probably because people who use high-end drycleaners already have an appreciation for better quality, while those who use discounters often don’t expect much.

The final cost of switching is related to the use of loyalty programs. These programs, intended to foster loyalty to a business, have been highly successful for a long time. Airline miles, hotel points, and cash rewards from drycleaners create a type of investment account that makes customers think twice before switching cleaners. As innovative as these programs have been, however, they are just one of many factors that determine your customers’ cost of switching and therefore their propensity to remain loyal in the face of a less-than-satisfying experience.