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Vishwadeep Khatri

The uselessness of Customer Satisfaction Scores in B2C sectors

Customer Satisfaction (CSAT)

 

Customer Satisfaction (CSAT) is an indicator of how satisfied is the customer with the product or the services being offered by the organization. CSAT is usually captured on a Likert scale (1 to 5 or 1 to 10). A higher rating is given if the product meets the customer requirements while a low score is given if the requirements are not met. It is a key performance indicator in many organizations

 

An application-oriented question on the topic along with responses can be seen below. The best answer was provided by Natwar Lal & Kiran Kumar.

 

Applause for the respondents- Natwar Lal, Kiran Kumar & Jayaram T 

 

Also review the answer provided by Mr Venugopal R, Benchmark Six Sigma's in-house expert.

Question

Q. 198  While customer satisfaction is captured in most B2C  companies, the score that is obtained has questionable value.  (For this discussion, we will use B2C in context of large set of end consumers who buy products or services from retail directly) What are the methods one can use to make such satisfaction feedback more useful in B2C?

 

Note for website visitors - Two questions are asked every week on this platform. One on Tuesday and the other on Friday.

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Customer Satisfaction is a key metric for all organizations but more so for any marketing company. It is commonly known as CSAT score and is an average of ratings provided by customers who have used the organization's service / product. CSAT happens to be most common way of capturing Voice of Customer (VOC).

Business to Customer (B2C) company is where the product or service is offered directly to customer. E.g. Uber, Fast Food Joints, Netflix, FMCG companies, Airtel DTH etc. Sometimes the CSAT captured for such companies could be misleading. Below are the reasons and how best to tackle it

 

1. Intermediaries between the company and customer: Following a typical value chain, you will have Manufacturer --> Distributor --> Wholesaler --> Retailer --> Customer. Ideally speaking the immediate customer for Manufacturer is the Distributor, however it is a very narrow view by the organization and is not a good idea. In this value chain, the customer experience is influenced by a lot of other factors as well which may not be in direct control of the the manufacturer. However, it is only the manufacturer that captures the CSAT. 

2. Customer does not provide unbiased and specific CSAT score (even if there are not too many intermediaries between the provider and customer)

3. Average of scores is used to check for overall customer satisfaction. Even though average works in most cases, sometimes it ignores the extreme scores which might be of importance

4. Capturing of CSAT is outsourced to a third party which might not give it the due importance.  Even if it is done inhouse, one should be vary of the below

a. Customer segments or sample not selected appropriately: With B2C companies the customer base is very big and hence selecting the right sample sometimes becomes a challenge as the service offering could be different for say different regions

b. Questions in CSAT survey not designed effectively: CSAT could be done for multiple reasons. One of the most common drawback in a CSAT survey is that it usually focusses on the overall satisfaction of the customer. At times, the company might want to know about the additional features that they want to provide and if the survey does not capture these correctly in questions, then the effectiveness of the survey becomes a challenge

c. Inappropriate rating scale in the CSAT survey: Giving too many options to the customer might confuse them. Also it might possess a challenge in inferences

d. Too small a sample to make any meaningful inferences

e. Purpose of capturing CSAT is unclear

f. Data cleansing not performed. There are methods in which you could actually check if the customer feedback is consistent or not as one would ideally want to filter out those customers who have just filled the survey without giving due attention to it. Certain questions may not be answered etc. and these have to factored in during reporting

 

How to overcome the above:

1. Do not outsource the work that is core to the organization. E.g. You may purchase an Airtel DTH set from any electrical shop. However, it is only the Airtel servicemen who will come and install it

2. Ask the customer to be more specific when capturing feedback. E.g. If a less than 5 star rating is given in Uber, they ask customers to choose from multiple options for giving low rating. Some of the parameters are linked to driver while rest are for Uber

3. Increase the touch points with the customer i.e. the company should be easily accessible to the customers who want to give a feedback

4. If CSAT is a key performance indicator for the organization, do not outsource it and have competent team plan and execute on how CSAT has to be captured

5. Requesting customers to register the product. This could not be done for all B2C companies, however, it gives an opportunity to the organization to know about the customer

6. Value chain integration i.e. the manufacturer works with various partners in the value chain to inculcate the same values and attitude towards customer service. E.g. automobile companies

7. Keep the questionnaire relevant to the purpose of seeking the CSAT

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Q. 198  While customer satisfaction is captured in most B2C  companies, the score that is obtained has questionable value.  (For this discussion, we will use B2C in context of large set of end consumers who buy products or services from retail directly) What are the methods one can use to make such satisfaction feedback more useful in B2C?

 

Ans : The act of collecting Customer Feedback is a "MUST" !!

The score that the teams derive from the customer ratings can be a double edged sword. Done right, it can be of Great Value !! Done wrong, it can mislead the team to poor analysis, conclusion & action plans.

The method that i would recommend is as follows :

1) Parameter Performance Analysis : This is a granular analysis of the ratings received for a particular parameter. Eg : Taste / Temperature of Food / appearance etc....can be for a restaurant that uses a delivery partner like Zomato, Uber etc. This is a Objective analysis and the comparison will be : vs Last month/ vs Last Quarter / vs YTD & so on...

This exercise must be done for all parameters featured on the feedback form (by the way, the feedback form should not take more than 1 min to fill)

2) The Score Sheet : This is a Focus oriented score i.e if this year, the company decided to make the Freshness by time it reaches the customer as an area of attention, the weightage to this parameter will be enhanced Eg : from 10% weightage in a 10 question survey to 20% weightage at the expense of few other parameters.

Organizations keep making One - Two areas as the Focus Areas for the year to get better faster and have the teams get the message of the importance of the Focused upon parameter...If this is done right, it can be a Force Multiplier. Hotel Chains do this as i have worked in that space...

Together, this model can be made "Most Useful" or "Most Useless"....A poor Feedback Survey & a misplaced weightages can make things worse than uselessness too.... #Goodluck !!

 

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Benchmark Six Sigma Expert View by Venugopal R

 

Most large organizations in the B2C sector perform customer satisfaction surveys. Various methods are employed, be it CSAT surveys or the recently popularized NPS. One of the issues about such surveys is that the possibility of variation in the measurement is very high. Unfortunately, the surveys are quite time consuming and expensive, that we may not be able to perform a classical R&R. Hence it might be quite difficult to decide whether any change in the scores between two surveys are due to random variation or genuine change towards the better or worse.

 

Based on my experience with B2C organizations, while we need to consider the customer satisfaction scores seriously, it is more important to delve into specific details viz. Product characteristics, Quality, Service support, Value for money etc. It is also important to be clear why the satisfaction survey is undertaken. Is it for studying the areas of customer dissatisfaction? Or is it for improving the already positive satisfaction scores? Or is it to see whether we can differentiate our product compared to competition and delight customers? Or, it could be a combination of all of the above.

 

While I look forward to read multiple ways of making the CS scores useful, I am providing a thought of keeping in mind the Kano Model and use it as a basis for structuring, evaluating and interpreting the customer satisfaction scores, especially in a B2C situation, where the variation of inputs is expected to be higher.

 

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Plan and classify the survey elements as best as possible into the 3 categories per Kano model viz. Threshold or basic, Performance and Excitement features with appropriate sub-stratification. The percentage of positive, negative and neutral responses need to be compared with previous surveys to assess improvement in each of the categories. This will also help to prioritize the efforts on improvement actions.

 

Obviously, the threshold factors need immediate attention to reduce the negative scoring, though we may not expect them to go very positive. We will also be able to give a balanced attention to the other categories as well and monitor the progress on each category.

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Every consumer is different and wants a unique experience when shopping and that ’experience’ has become the critical differentiating factor for many successful business models. However, businesses are finding it increasingly difficult to predict & understand what consumers want as their expectations continue to change.

 

Consumers have become increasingly comfortable interacting with brands in a seamless way, switching between channels and allowing their data to be used to provide a personalised experience.Customer satisfaction is paramount for any firm's marketing strategy. “Customers are the purpose of what we do and rather than they depending on us, we very much depend on them.

 

The customer satisfaction scores can be categorized in to themes based on various attributes of consumers such as

1.       Age

2.       Male / Female

3.       Location

4.       Purchasing ability

 

The scores for the themes can be analysed and the low scored theme can be compared with competitors to have a benchmark. The low scored themes to be worked upon for improvement.

 

Another method is to identify the industry benchmark score for each of the questions and compare it with actual CSAT score this will help in identifying the area which need to be improved to be the leader in the sector

 

The CSAT scores can be made meaningful only if the expectations of customers are fully understood and fed back into the strategic planning process. Its is also important to have a periodic survey to monitor the effectiveness of actions taken from the previous survey.CSAT scores would be meaningful if the organization is able to go back to the consumer and explain the changes they have made considering the survey.

 

The customer satisfaction scores can be categorised as below and worked upon

o    Worst Problem Areas

o    Areas to Improve

o    Areas to Prioritise

This will help the organisation to have a systematic approach in addressing the categories based on their impact to consumers.

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