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How to Increase Customer Satisfaction and Lower Costs

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How to Increase Customer Satisfaction and Lower Costs

Chris Tsakalakis shares a summary of a presentation he gave at The Marketplace Conference on how to increase customer satisfaction and lower costs.

This is a summary of a presentation I gave at The Marketplace Conference in May of 2020.  The presentation was entitled How to Increase Customer Satisfaction and Lower Costs and I gave it as a sample of the work my consulting firm, Trefo, does.  You can view a YouTube video of the presentation here and download a pdf version here.

Why Care About Customer Satisfaction

A really important part of growing both StubHub and Vivino – two companies I previously ran – was using customer feedback to improve the company and build a long term sustainable business. At both companies, we measured our progress by looking at 3 key metrics: 

  • Employee Engagement
  • Customer Satisfaction 
  • Financial Results

And we looked at them in this order because each metric drives the next one.  Engaged employees go the extra mile to satisfy customers.  Satisfied customers tell their friends and make repeat purchases and that drives financial results.  And a company that’s doing well financially usually has higher employee engagement, all other things being equal.  

At least that’s the way I always explained it.  But there is an additional dynamic here.  Customer satisfaction also drives employee engagement. The better your company is at satisfying customers, the more engaged your employees are.  Employees want to work at a place where the company is doing the right thing for customers. Every employee you want to retain wants your customers to be satisfied. So customer satisfaction is a driver of both financial results and employee engagement.

When Customer Satisfaction Matters Most

Many companies go through stages as they grow.  This is especially true of marketplace technology companies.  I think about 3 basic stages of growth:

  • Early
  • Golden Age
  • Mature

In the early stage of a company, you’re just struggling to find product market fit.  There is a lot of effort spent on figuring out what your customers want and how to make money giving it to them.  

At the later stage of a company is the mature stage when you have figured out how to deliver what your customers want and have achieved significant revenue.  The issue at this stage is finding ways to increase revenue growth through new geographies or new products and services tied to your original business.  

In between the early and mature stages is what I call the golden age of marketplace businesses. In this stage, you have found product market fit and your revenues are growing rapidly, but you have many opportunities to improve your business and most of them improve profits AND customer satisfaction. And this is the stage that StubHub and Vivino were in when the examples below took place.

 

Key points include:

  • Measuring customer satisfaction with net promoter score
  • Focusing on customer service issues not wage
  • Setting clear expectations

Read the full article, Your Customers are Telling You How to Be More Successful. For God’s Sake, Listen to Them, on ChrisTsakalakis.com.