Companies have many different reasons that prompt them to implement a customer satisfaction program. While most companies choose to implement such a program because they recognize it as a step towards greater profitability, there are others that use this tool as a way to reverse negative trends taking place in their business. For this case study, we would like to discuss two similar companies that used customer satisfaction research for completely different reasons.

Company A
The first company was facing a stall in their growth strategy. While they have been growing steadily during the last 25 years, they recognized that they could grow even faster if they would reduce customer defections. While their loyalty rate was high for their industry at about 81%, the 19% of customers they lost, cost the company $560,000 annually. Even though they were profitable and growing, they were not growing fast enough to bring in the third generation of family ownership that was desired.

While they had previously implemented programs to improve customer relations and service they still were not able to surpass the 81% loyalty barrier.

The reason they were not able to move past the 81% barrier was that they had previously not fully understood why the 19% of customers that were not being loyal were choosing to leave. Furthermore, they didn't know why the 81% of customers that remained loyal chose to do so.

For this client we developed a program that measured the satisfaction and loyalty of their entire customer base with an emphasis on determining why the customers made specific purchasing decisions. This included an analysis for each different type of customer and an analysis of the different types of services purchased by each customer group. Furthermore, we also looked at customers that had defected to gain an understanding of where they went and why.

The final result was a comprehensive stratification of the entire customer base. In this analysis we were able to determine that the client didn't desire 2% of the customers that were leaving anyway. However, the other 17% were desired. It was determined that there were three different reasons that were causing these customers to leave.

By providing this information back to our client they were able to address these issues and move beyond the 81% satisfaction level for the first time in 25 years.

Company B
While company A was a successful company trying to become more successful the same is not true of company B. Company B had also been in business about 25 years and had enjoyed solid growth and success during that time. The owner's goal was to sell the company and retire within 5 years.

However, these dreams were evaporating quickly because the company had begun hemorrhaging customers and money during the previous eighteen months. The year over year profits were down 25% and the company was operating at a loss. The business owner knew he had problems but didn't know what was happening to drive away his customers.

For this analysis a two-pronged approach was developed. The first prong was designed to immediately identify the source of the customer loss. To accomplish this, a telephone study was utilized that targeted customers who had been loyal during the past two years but had not returned during the past six months. In speaking with these customers we were able to identify specific issues that had arisen within the company that were alienating customers that had previously been loyal.

The second prong of the study looked at a broader section of the customers to identify systemic issues within the company. This section of the research also stratified the customer base according to the amount of revenue generated. Here we were able to determine that while Company B was doing a good job of satisfying the small clients they were doing a poor job of satisfying large clients. With this information Company B was able to implement programs designed to ensure that high value clients were identified so that special care could be given to them to ensure their return.

Once the previously loyal customers became loyal again and the high-revenue-generating customers began generating high revenue again, the company could focus its attention on the remainder of the customer base.

While these changes did not take place overnight, due to the rapid response and detailed analysis provided by our study, Company B was able to fix their issues and return to profitability within one year.