How Can We Benefit From Measuring Customer Dissatisfaction?
Improve overall experience for your customers by looking at their dissatisfaction--it can be done in seven basic steps.
Posted Nov 24, 2003
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If we take customer satisfaction scores and turn them upside down, we find what percent of customers are not pleased with the service they receive. This presents a new way to improve overall experience for our customers: Focus on the negative, with the sole purpose of arriving at the positive.

So let's change the way we look at customer satisfaction surveys. Why not ask customers to tell us about their dissatisfaction, instead of their satisfaction? We have all read the statistics about unhappy customers. You know the statistic: If I am happy I tell three other people, but if I am unhappy I tell nine. And if I am really unhappy and leave, you now have to pay twice as much to get another customer just like me.

The costs for customer churn can have a huge impact on the viability of a business. Understanding why a customer is unhappy and attempting to fix the problem is a surefire way to reduce customer churn and to improve your bottom line. Whether you are a small organization or a Fortune 500 company, looking at the dissatisfaction of customers can be achieved in seven basic steps.

1. Identifying Opportunities for Improvement
The first step is to understand how your customers view their experiences with the company. You can do this by breaking down interactions into six to eight key experiences like becoming a customer, shopping for products/services, buying products/services, etc.

Also, identify the key customer segments and channels that customers use to interact with your company. Catalog the experiences and identify the events that make up each customer experience.

2. Validate Information Directly
The best way to do this is to conduct individual interviews with customers across several segments of the business. Ask the customer about his daily interactions and listen for key areas of dissatisfaction. Create a list of questions that covers various experiences. The key to the interview is to allow a customer to talk openly about his problem. Focus on listening and understanding how each channel and organization is affecting satisfaction. Ask questions that are open-ended and that will generate the most amount of dialogue, for example:

  • How did you hear about us? Did you contact us first? What was your experience like?
  • How do you use our products? What do you like and dislike?
  • What happens when you have a problem? How do you contact us? What has been your experience when you do contact us?

    3. Create a Dissatisfaction List
    Based on the information that you have gathered, create a list of 20 to 30 pain points for the customer. Be sure to include pain points across each of the customer experiences. Create the list in first-person statements. If possible, work with a research firm to complete the list. Examples include:

    "The company Web site did not have the information I needed."
    "The customer service rep could not explain the service options."
    "The sales rep did not return my phone calls."
    "Filing a claim was confusing and time-consuming."

    Ask follow-up questions to validate information and understand the specific problems. Be sure to ask questions to understand where the problem is most prevalent among the various customer segments that you service and channels that you provide.

    4. Conduct Quantitative Research
    Now that you have created the dissatisfaction list, conduct quantitative research to understand how customers rank the problems. Enlist the help of a research firm to conduct the surveys online or via phone. Customers should be able to check more than one category and be able to give you detailed accounts of the problems. These verbatim accounts will prove invaluable when you move to the next step of defining the root cause of a problem. Allow the customers to choose as many problems as they want. Ask them to also identify their most important problem.

    5. Analyze the Results
    Once the results are tabulated, there are two key components to making the information actionable. First, categorize the information in a way that tells a story across the organization. Attempt to understand if the number one problem is also the most important one in the mind of the customer.

    Second, attempt to tie the results to actual customer churn and lost revenue associated with a lost customer. This way the plan becomes actionable. Let's say that the number one problem for the large business customer is the way a claim is handled. Look at the customer turnover rate from last year among these customers and tie lost revenues to the top problems identified within this segment. If customer dissatisfaction can be tied to specific lost revenue, it is much easier to find the money to fix the problem as a next step.

    6. Implement Organizational Change
    Once you have identified the top categories for change, create internal action teams (IAT) to further analyze the data and find solutions for improvement. Gather people from each of the contact channels and conduct strategy meetings to discover the root causes for pain-points the customers have identified. Remember to keep the focus for change on the customer. Don't let the recommended solutions simply fix internal problems, but focus on how the change will positively impact the customer.

    Have the IAT identify quick hits that will make an immediate impact on the customer. Work as a team to understand the actual pain point, the source of the pain, and how we can change to improve the experience. Have IAT ask such questions as: "Are there processes in place that can be changed? Is there a new way to gather information or solve problems online that will reduce customer pain?"

    The IAT should also identify long-term solutions that may take months for implementation. Identifying these solutions will allow the company to create detailed plans and budgets that are centered on improving the customer experience.

    7. Continue to Check the Pulse
    Now that you have identified customer dissatisfaction and developed improvement plans, you must circle back and confirm that the changes are having a positive impact on the customer by conducting additional research to validate that there has been a shift in the customer's perceptions. Conduct the survey again at the six-month and one-year mark to analyze if there are shifts in behavior and customer satisfaction.

    Begin to measure and report on internal metrics that focus on the problems outlined by the customer. If the customer said that the claims process takes too long, measure the process from beginning to end and report on the information to validate that the changes are making a difference in the eyes of the customer.

    Measuring dissatisfaction and implementing a plan to improve the experience is not a simple process, but companies across North America are finding that focusing on the negative is sometimes the most efficient way to make the customer the most satisfied. Solve his problems, and he will not only become a loyal customer, he will spread the word about his satisfaction.

    Because customer retention is a key focus for most companies, understanding why customers are leaving and how much their dissatisfaction with the company will cost the company next year is the first step toward fixing the problems that customers see as most important.

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