The fallacy of the customer satisfaction survey

Tom Dougherty, CEO – Stealing Share

23 June 2014

Customer satisfactions surveys just attract the extremes

Talk about a survey that doesn’t really matter. Reports last week from the American Customer Satisfaction Index stated that McDonald’s ranked dead last in customer satisfaction among 12 fast food chains – for the 20th year in a row.

“I bring this up because customer satisfaction, while important, is not what brand preference is built on – and too many companies count their success/failure strictly on that.”

 

While McDonald’s claims it takes that ranking seriously, I ask: Why? Meeting your customers’ expectations is simply best business practices, but I can’t imagine McDonald’s ditching the Big Mac over this survey. If customer satisfaction was so important, why has McDonald’s been the market leader for those 20 years?

QSR Market customer satisfaction survey

McDonalds seems to always win

I bring this up because customer satisfaction, while important, is not what brand preference is built on – and too many companies count their success/failure strictly on that. But that’s inside-out thinking and relying on it too much can prevent you from stealing market share.

More to the point, we’ve worked with companies who have pointed to their high customer satisfaction ratings and said, “See? We are doing great. Look at our J.D. Powers ranking!”

However, those same companies will wonder why their market share is declining. After all, if customers are satisfied, the companies should be successful, right?

Not so fast. The definition of stealing market share is that you take customers of the competition – that is, those who do not choose you.

We worked with a bank (who eventually came around and is currently stealing market share) that thought the key was having a better website because online banking was so important. Sure, we told them. Make it better, but don’t confuse it with the reason why people would choose you. They don’t know you have a better and easier to navigate website until they have already joined you. To get them there, you have to reach them before the moment of decision.

The customer satisfaction survey is all well and good. If it is detailed, it can help with tactical elements of your business. But it is not the main avenue for stealing market share.

That’s why, after 20 years, McDonald’s probably looked at the survey, made a few notes – then threw it into the trash.

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6 Comments

  1. Corbin

    The first point where McDonalds ranked last in customer satisfaction yet they are the market leader is proof of the fallacy of customer satisfaction surveys. If they actually mattered to the customer, don’t you think they would choose differently?

    Reply
  2. Mike Oz

    Oh man. This speaks to a pet peeve of mine. Customer satisfaction surveys often speak to the extremes, meaning one bad incident gets played for greater than it’s worth.

    Also, it’s easy to bad-mouth the big dog and pet the little one. Yet, you choose the big dog.

    Reply
    • Tom Dougherty

      The real problem is with methodology Mike. You could actually conduct a customer satisfaction survey if you had the ability to collect all the names and numbers and randomize the study to the entire segment. At least the conclusions would be projectable. However, even that begs the question as to how important the ideas of the converted are as apposed to the needs and wants of the prospect. You can read about the different types of research methodology here. http://www.stealingshare.com/what_we_do/methodology.htm

      Reply
  3. Rachel Lentz

    Customer satisfaction surveys are usually a joke. Answered by those that either love you (pat on your back) or those that down. As stated above…the extremes. I laugh every time I see a JD Powers ranking.

    Reply
  4. Mark D.

    I tend to agree with Mike… People typically fill out a survey if their experience was unusually great, or just terrible. The middle gets glossed over. When I worked in the food business, our comment cards reflected just that.

    Reply

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