by Clive Keyte

Customer Satisfaction

Customer Satisfaction – In our next series of articles, we’re going to look at a selection of well known KPIs and focus on each in turn. We will examine why the KPI should be included in your set. But first, let’s touch on why it is important to develop general KPIs and make them specific to your business.

We don’t recommend ‘standard’ KPIs

At Intrafocus, we do not recommend using ‘standard’ industry-wide Key Performance Indicators that you might find in a book or KPI Library. What might broadly apply to a business or organisation is unlikely to provide you with a competitive edge. If you do what everyone else does, you will be the same as everyone else.

So why are we looking at Customer Satisfaction?

Customer satisfaction is an Index. It is made up of multiple measures. The measures will be (or should be) specific to your business. If I run a Yacht club I will ask questions about sailing, if I own a shop, I will ask questions about my products and service. But at the end of the day, the Key performance indicator is Customer Satisfaction.

Also, customer satisfaction will be based on an objective that is specific to your business. For example in a retail outlet a customer satisfaction objective might be to ensure products are available on the shelf. One of the index measures might be ‘% Products Out of Stock’. However, in a Training company a customer satisfaction objective might be to provide enlightening courses. One of the index measures might be ‘No. of repeat courses attended’.

The best approach is to select KPIs that are specific to your own company and your objectives. This will ensure that you measure what you are actually trying to achieve. To find out more about the reasons behind this, visit our earlier article on developing meaningful KPIs.

Customer Satisfaction is a complex KPI and therefore needs special attention


5 Reasons to Measure Customer Satisfaction

All organisations will have KPIs which relate to customer satisfaction, whatever their industry and purpose. Customer satisfaction lies at the heart of any successful business.

1. Customer satisfaction is a critical success factor (CSF)

Many businesses now seek to position themselves successfully in their markets by offering superb customer experiences as a key success factor. Customer service – and experiences – are often the deciding factor for purchase and loyalty in today’s markets, which are typically flooded with multiple product and service providers. If you operate within a market which has heavy competition in the form of alternative offers, brands and myriad price points, an excellent level of customer satisfaction will help you to attract and retain customers. This customer ethos will win you positive reviews, and a powerful brand reputation.

2. Great service reduces churn

Many businesses assume that customers are simply looking for the best possible prices – particularly in markets where e-commerce is prevalent. But research has shown that churn tends to be driven by customer service and the overall experience. If you serve your customers well and provide a positive experience, your churn will become low. By measuring customer satisfaction and by tracking it over time, you can embed processes which analyse their experience at each touchpoint.

3. It mitigates the risks of negative WOM

Forget attempting to control your brand via paid-for marketing channels that carefully control the messages you share about your brand. Social and digital media make today’s customer marketplaces democratic. Experiences are shared widely, and – unfortunately – this means negative experiences as well as positive ones. In fact, research by McKinsey found that an unhappy customer will tell up to 15 people about their bad experience, and 13% will tell a whopping 20 people or more! That’s an immediate viral impact. Now, it’s very hard to make sure that every single customer has the perfect experience, but you can work hard to get your processes right, and your customer service ethos. If you continually measure metrics that relate to customer satisfaction and prioritise them, you will be able to look for trends and any weak spots which lead to dissatisfaction.

4. It turns unhappy customers into advocates

Up to 95% of people who have had a bad experience with a brand would be willing to try it again if the problem was put right. Customers know that mistakes happen, but the way that you deal with it will make all the difference. If you empower your customer services staff to go the extra mile, and to follow up on complaints, your brand will get a great reputation as an authentic provider of positive experiences.

5. Customer satisfaction impacts your bottom line

If your customer base has a positive view of your brand, they will choose to patronise you. If your stakeholders see that you are a customer-focused business, they will endorse you. If your customers love buying from you, they will tell others. This will drive your profits or bottom-line results. The key to success here is to measure repeated transactions, customer churn, customer lifetime value and other key indicators that matter to your business, and which identify how happy your customers are.


To enjoy success in this field, you need to identify the right KPIs to measure your customer service related objectives and goals, which are likely to lie at the heart of your business strategy as a whole.

From this point, you should get into the habit of measuring these customer satisfaction metrics on a regular basis – even daily – to constantly monitor what is happening in your business. This ensures that your processes are working and that customer satisfaction lies at the heart of your success – rather than being something that only comes up in a crisis situation!

Useful resources

Keen to find out more about KPIs and how they can support your strategic success? The Intrafocus team recommends this highly usable book by Bernard Marr, which is filled with actionable pointers for managers and written in an accessible style: Key Performance Indicators (KPI): The 75 measures every manager needs to know.

Get in touch

Our team of strategy experts at Intrafocus are here to help your organisation to enjoy strategic success – whatever stage of development you are at. Whether you are beginning to craft your strategy or seeking to create KPIs which will unlock measurable value for your organisation, we can assist. Please contact us to find out more.

Key Performance Indicators you Need to Know