Customer satisfaction and loyalty - Assignment Example

 Сustomer satisfaction and loyalty There is no relationship between satisfaction and loyalty. There is a long established idea that the more satisfied customers are, the more they will come back for more. The idea that loyalty and customer satisfaction are not related seems to be wrong. Dixon, Freeman, and Toman (2010) suggest that when people are looking at their customers to try and please them, that customers just want their problems solved. The state that this is the fastest way to bring customers back and by solving their problems, the customer will stay loyal. Akbar, Som, Wadood, and Alzaidiyeen (2010) also state that customer loyalty is a product of good service quality. They state that the reason that customers keep coming back to a business is because they are treated well. They suggest that because people are able to travel all over the world, they are looking for the best service everywhere they go. These researchers studied the hotel industry to see whether people came back to the same hotel when the service was good. They found in one study that 75% of consumers said that they would go back to a business if they had a speedy response to their customer service inquiry. This means that again, service quality was responsible for loyal customers. Customer service can be challenging for some businesses especially when they have some employees who may not be people oriented. Often, this means that employees must receive extra training in order to make sure that they understand how to work with customers. Abildtrup (2010) states that those employees who are in front of people all the time need extra help. He states that marketing and advertising only do part of the work by bringing customers to the business. Once they enter the doors, it is the job of the front line employees (those who meet and greet the customers first) to keep them coming back by providing excellent customer service. Abildtrup states that businesses cannot depend on their employees to understand how to deal with customers on their own; instead, they must have the training they need to get the job done. Employees must understand that they are one of the reasons why people do come back to a business. If someone goes to a business for the first time, they are looking for something in particular that only that business can provide for them at that time. If customer service is genuine and happens quickly, people will remember this experience; they will also remember a bad experience. Buchholz (2010) identifies four levels of interest that employees have who work in any business. These four levels are: 1. The survival level where the employee comes to work to do their job. They cannot be depended on to take on additional work because they are only there to get a paycheck. 2. The acceptance level employee is open to new jobs and they believe in the philosophy and the goals of the organization. They are productive employees but they do not like to do more work, and if something else comes along, they probably will leave. 3. The merit level employee loves the company and adds to the company's mission. They love their job and they are the people who actually make sure that things are done. They are loyal employees and are quick to jump in and do more work when it is required; they are also good in a crisis. 4. The self-fulfilling level employee understands that what they do on the job is important. They have a buy-in to the company and they know they make a difference because they want to do a good job. Clearly, it is the third and fourth level employee who will do the most for the company and they will provide the best customer service because they are involved in the company because they want to be there. Yim, Tse, and Chan (2008) add to this discussion by taking the conversation a bit further and stating that customers that can form an interpersonal bond with employees will be the most loyal. As an example, an individual who goes into a computer store to buy a computer will purchase something once they are satisfied that the store has what they want. If the employee they meet is patient, kind and caring about their needs, the individual will not only purchase something, but they will bring family, friends and colleagues to the store to ask for the same employee. There are many issues that customers face when they go into a store to purchase something. They may feel a bit awkward when they walk in because they are looking for something special. They may feel like they are prey if the sales person comes at them too strongly. This means that there must be a balance between customer assistance and employee push to make a sale. Kumar, Petersen, and Leone (2010) present another side of customer loyalty and that is to get them to a point where they will refer other customers to the business. They suggest that building a social network in the work place is a better idea than attempting to do marketing outside. As an example, they suggest providing customers with information about their products through the network and making it exclusive information to regular customers. This will bring not only loyalty from the customers, but it will help the business stop competitors from luring customers away. This is just another way for customer satisfaction to breed loyalty for the business. Customer satisfaction has to happen in many businesses for customers to continue with that business because of the competitiveness of the world today. Customers can choose more than a few cell phone companies, they can find a record number of food outlets, and they can shop at any retail store in the nation. They depend on being able to get what they want, when they want it. They also depend on a store being able to supply them with good customer service. Of course, the type of customer service they want will vary with the type of business. As an example, they will want a different type of customer service when they go to a hotel, then they would if they went to a retail sales outlet. The point is that customer service is very much tied to customer satisfaction. Helgesen (2006) studied how customer satisfaction was specifically related to customer loyalty and whether it provided a profit for the business. Through their research, they found that there was a direct relationship between customer loyalty and profitability that was driven by customer satisfaction. These studies have shown that there is a relationship between customer loyalty and good customer service. Each person can think about this in their lives and could state times when they were satisfied with customer service and when they felt that the business lacked good customer service. Many businesses have closed their doors and this researcher cannot help but wonder if it was because their customer service was poor. When anyone goes to a business, they expect that they will be treated well and treated fairly. They expect to be talked to gently and to be told the benefits of a product they are considering. All of this points to satisfaction and a guarantee that there will be loyal customers if treated well. References Abildtrup, Fredrik. (2010). Learn why customer service employees need more attention. Return on Behavior Magazine. Retrieved from http://www.returnonbehaviormagazine.com/articles-of-interest/learn-why- customer-service-employees-need-more-attention.html Akbar, S., Som, A.P., Wadood, F., and Alzaidiyeen, N.J. (2010). Revitalization of service quality to gain customer satisfaction and loyalty. International Journal of Business & Management, 5 (6), p113-122. Buchholz, L. (2010). Customer service and employee satisfaction. CSM Magazine. Retrieved from http://www.customerservicemanager.com/customer-service-and- employee-satisfaction.htm Dixon, M., Freeman, K., and Toman, N. (2010). STOP trying to delight your customers. Harvard Business Review, 88 ( 7/8), p116-122. Helgesen, Øyvind1 (2006). Are loyal customers profitable? customer satisfaction, customer (action) loyalty and customer profitability at the individual level. Journal of Marketing Management, 22 (3/4). 245-266 Kumar, V., Petersen, J.A., and Leone, R.P. (2010). Driving profitability by encouraging customer referrals: Who, when, and how. Journal of Marketing, 74 (5). 1-17. doi: 10.1509/jmkg.74.5.1 Yim, C.K., Tse, D., and Chan, K.W. (2008). Strengthening customer loyalty through intimacy and passion: roles of customer–firm affection and customer–staff relationships in services. Journal of Marketing Research (JMR), 45 (6) 741-756, doi: 10.1509/jmkr.45.6.741 Read More