Situation:
Our client was a well-established company with a strong executive leadership team. Their CEO recognized a portion of their business that had slipped between those functional department heads – Customer Satisfaction and Retention. She was concerned about their customer turnover, feeling it was higher than acceptable, but they lacked clarity on the underlying causes. Without a clear understanding of their customer satisfaction and loyalty levels, they found it challenging to determine needed improvements. They approached us to help identify client expectations and to provide recommendations that would directly address the customer retention issue.
Solution:
We recommended a comprehensive, two-part research approach involving qualitative and quantitative surveys. This process was designed to provide our client with a clear understanding of their current client satisfaction and loyalty.
The first phase was qualitative. We worked with the client to develop a discussion guide and advised them to conduct 10 in-depth interviews with key clients. These interviews yielded quick insights, particularly around several low-hanging issues contributing to dissatisfaction. Armed with this information, we helped the client design and implement targeted improvement initiatives that made an immediate impact.
The second phase focused on quantitative data collection. We developed a comprehensive client satisfaction and loyalty survey aimed at establishing a performance baseline. This survey combined key metrics such as overall satisfaction, likelihood to recommend, and likelihood to continue using the client’s services to segment clients by loyalty level. It also measured about 15 key service attributes we identified as key drivers from the qualitative interviews. Based on the results of this survey, we identified additional improvement areas. We then collaborated with the client to assign these priorities to relevant department heads for ongoing focus and improvement.
Outcome:
At the start of this engagement, client retention was at 80% year over year. The initial measurement loyalty metric – combining satisfaction, likelihood to recommend, and likelihood of continuing use – stood at 72%. Our benchmark target is 80%. Over two years, we helped them increase this metric to 77% in the first year and to 81% by the second year. This improvement in customer satisfaction directly influenced customer retention, which increased from 80% to 84% in year one, and to 87% in year two. The increase in customer retention led to similar gains in revenue and profits during the same period, demonstrating the direct financial impact of the improvements we helped the client achieve.
Customer retention is one of the metrics that seems obvious, but it’s also something that can often get overlooked. The same goes for purposefully and intentionally asking your clients how you’re doing and how you can improve. By letting Proxxy put a research program in place, this client now has a standard process that will help them keep improving and growing.
