Measure more than customer advocacy

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Gina Pingitore is chief research officer at J.D. Power & Associates, the consumer ratings and research company based in Westlake Village, Calif. BtoB recently asked Pingitore about best practices in customer feedback and satisfaction.

BtoB: What's your take on the satisfaction metric-du-jour, customer advocacy?

Pingitore: There's a lot of fact and fiction surrounding this single metric? that the customer's willingness to recommend you to others is the only metric you need. But there are others, such as customer experience, commitment and repurchase. Our data clearly show that each of these has a solid relationship to share of wallet, purchase frequency and length of the customer relationship. All too often, organizations play Whac-A-Mole, reacting to what they think is the newest, greatest thing, with no knowledge of how to use the information.

BtoB: What's J.D. Power's approach?

Pingitore: I tell clients that customer satisfaction research can be broken into three simple questions: "What?" which is what's important to your customers. "So what?" or how you're doing relative to your competition. And "now what?" or how to use this information within your organization. Customer advocacy just tells you the "what," and it doesn't give you information about attritted customers or never-been customers. You're missing two important groups right there.

BtoB: Hasn't customer satisfaction always been on companies' radar screens?

Pingitore: Yes, but some companies have stopped caring about what's really important to customers. They simply track a score to meet some bonus criteria. Then they go back to their stakeholders and say they care about customer satisfaction when they really don't. But companies that are really customercentric do care about the answers and act on them.

BtoB: What's a good approach to finding the ROI of customer satisfaction?

Pingitore: Being fiscally responsible about it. For example, customers may be delighted if you drop the wait time at your call center from 15 seconds to just 10 seconds, but you have to balance the cost of achieving this with whether it's fiscally warranted. Another way to look at it is, if I'm improving 10% in satisfaction, what does this buy me in reducing attrition, improving share of wallet and a variety of outcomes that actually impact on your brand's bottom line.

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