By Rolph E. Anderson, Srinivasan Swaminathan and Rajiv Mehta
Companies looking to build a satisfied and loyal customer base need to realize that there are multiple drivers of customer satisfaction.
A small increase in customer loyalty can make a big difference in company profits. McDonald’s, for example, calculated back in the 1990s that just one additional visit per week by “heavy users” would boost annual sales by more than $10 billion dollars.
To gain a deeper understanding of the factors shaping customer satisfaction and loyalty, two of the authors conducted in-depth interviews with 20 online shoppers and 10 e-commerce executives to develop a questionnaire. Then, working with a market research firm, we collected data from 851 respondents and conducted multivariate data analysis. We identified six significant drivers of customer satisfaction in e-business, which in turn influence customer loyalty: adaptability, commitment to customers, connection with other customers, product assortment, easy transactions and appealing environment. Here we will discuss the role of adaptability, and how adaptability is relevant not only to e-businesses but elsewhere.
A “one size fits all” approach is no longer adequate. Businesses must find ways to tailor their products, services and shopping experience to individual customers. Advances in data mining and purchase behavior modeling allow companies to utilize cloud data to predict and target individual customers’ purchase interests. Caesars Entertainment Corporation, one of the world’s largest gambling casino operators, collects detailed information on individuals’ gambling behavior as they move from machine to machine (for example, how many different machines they play, how many wagers they place and the total amount of money they deposit in the machines). By the time the customer leaves the casino, Caesars has enough information to know how much the customer is worth to the company, to build a detailed profile of the person’s gambling preferences and to develop a plan for enticing him or her back to the casino.
Apple is also well known for adapting product offerings and services to the needs of its customers. With airy store interiors, attractive lighting and attention to small details, it provides customers with a casual yet exciting atmosphere. The company teaches sales associates not to sell but rather to help customers solve their problems. As an Apple training manual puts it: “Your job is to understand all of your customers’ needs — some of which they may not even realize they have.” To keep the focus on finding solutions for customers, sales associates do not have to meet sales quotas and do not receive sales commissions. They are trained to approach customers with a personalized welcome, to gently probe to understand their needs, to listen for and attempt to address their concerns and to invite them to return in the future.
This is an excerpt of the article-How to Drive Customer Satisfaction- written to MIT Sloan Management Review by Rolph E. Anderson, Royal H. Gibson Sr. Professor of Marketing at Drexel University’s LeBow College of Business in Philadelphia, Pennsylvania, Srinivasan Swaminathan, professor of marketing at Drexel University and Rajiv Mehta, professor of marketing in the School of Management at New Jersey Institute of Technology in Newark, New Jersey.