There is much talk about satisfying customers. In fact nearly any marketing text you pick up, blog you read, the main definition of marketing is ‘satisfying’ customers. Researchers, managers, experts in the past have said that satisfaction can lead to loyalty, profitability, customer retention, etc. However, this is now changing. I believe we need to do a major rethink on this topic. Customers are no longer satisfied with being satisfied!!!

What is satisfaction? Well satisfaction is essentially meeting the customers expectations. If you promise to deliver a document by 1 pm, and you do it at 1pm, the customer will be satisfied. If you’re late, then that results in the dissatisfaction. However, if you are considerably early, then that results in a higher degree, which can also be called delight.

The problem with satisfaction is that competition has increased. There are many companies out there offering similar products and services. With the globalization of the economies, the number of new companies entering markets from countries like China or UAE are increasing. Similarly western companies are expanding into these countries. Hence, overall we have an increased level of competition. Each company is trying to excel and beat competition. Furthermore, the customers are much more aware of their surroundings today, than 10 years ago. The internet, and more specifically Social Media, has really revolutionised the way how we communicate and how information flows. Customers can find out about a sale, or promotion, or the latest features of a product even before any of these are launched.

Research now says that there is no guarantee that satisfied customers will become loyal (any level of loyalty). So what does that mean for companies? Companies now need to go beyond satisfying their customers if they want to get them to come back. Hence strategic management needs to rethink their goals and objectives. I think companies should now aim for delight, instead of satisfaction. Companies that can make their corporate culture around this idea will be winners. Delighted customers are ones that are most likely to not only come back to you, but also achieve higher levels of loyalty. Moreover, these guys will be telling not tens, but hundreds or even thousands of their pals (through social media) about what a fantastic company you have.

In the short-term, it may mean an increase in costs. However these are far out weighed by the benefits they bring in. A number of companies that I’ve worked with that have adopted this philosophy have seen their revenues and profits increase over time. Moreover, they have also seen their marketing budgets decrease, since word of mouth brings in more customers than any other form for them. Interestingly this is true for both B2B as well as B2C companies. Moreover, it works for all sizes of firms, from SMEs to Multinationals.

What do you think about this? Do you see an problems or issues in implementing this strategy? What other benefits could companies get by doing this? I would love to hear your views.

Dr Osman Khan is one of the world’s leading experts on customer loyalty management.

Customer satisfaction doesn’t cut it anymore