Terry Vavra's Blog

Using Industry Norms to Interpret Satisfaction Survey Results

Posted on 06. Jun, 2010 by tvavra in Customer Research

Why is the satisfaction measurement community and our Clients always looking to benchmarks as a means of  interpreting customer feedback?  It’s so often the case that upon receiving customer satisfaction scores, a corporate executive will ask, “Well, how do these scores compare with the scores our competitors are receiving?”  This question seems to preempt a more meaningful evaluation of survey results.  It is as if the executive is seeking absolution by matching his or her (possible) mediocrity with the equally lackluster results of a competitor!

I’m always concerned that a Client’s management team will use the fact that it has surpassed an industry benchmark as indicating that it is doing a “good job”.  By way of an example, that could mean that a Client’s customers’ top-box satisfaction with their overall shopping experience of 50% (surpassing an industry baseline of 45%) could be interpreted as grounds for celebration.

Goaling for Mediocrity

But let’s understand, industry benchmarks are at best an indication of averageness.  And being “average” is a decidedly unambitious strategy.  By accepting satisfaction scores that equal or only slightly exceed industry benchmarks, a manager accedes to the fact that a significant number of his/her customers (50% in the case above) will be less than extremely satisfied!  As they are only moderately satisfied, they are likely not to be “secure customers”.  A business accepting such a modest level of enthusiasm from its customers (simply meeting an industry benchmark), would likely perform no better in the future than the average business in the category…a dangerous outcome in today’s highly competitive categories.  Long term success comes only from significantly surpassing competitors and that means exceeding industry norms.

Goaling for Attainable Superiority

In my book, Improving Your Measurement of Customer Satisfaction, I urge businesspeople to react to their customer satisfaction scores by setting their own performance goals at levels that will significantly impact their business – elevating them to “best of class” – or even “world class”.  This means looking beyond the current outcome (50% in the above example) and establishing one’s own goals.  The business in the above example might decide to goal for satisfaction scores perhaps as high as 65% (i.e. 2/3 of all customers) reporting being delighted with their shopping experience.  While such an ambitious goal may be a “reach” it can be stretched over a one- or two-year period allowing a “reasonable” time frame for it to be accomplished.

By establishing this sort of internal goal, each new period’s customer satisfaction scores can be reacted to in terms of the progress being made towards achieving the established goal.  In this perspective, comparison with external benchmarks becomes rightfully irrelevant.

Tags: Customer Research, Customer Satisfaction, Market Research