ABSTRACT

Customer satisfaction is crucial to organizational success and a leading indicator of business financial performance. Satisfaction is a customer’s holistic response to a consumption or usage experience; it can be measured using well-understood metrics. This chapter summarizes what is known about customer satisfaction and clarifies its relationship to related constructs such as customer engagement and customer experience. It provides an in-depth explanation of the role of customer satisfaction in marketing strategy – organized around the ways that increases in satisfaction lead to increases in customer acquisition, retention and margins. Next, this chapter outlines seven major strategies for achieving high customer satisfaction levels. Then, it identifies key principles that can guide firms in allocating resources to customer satisfaction programs versus other investments – and highlights specific opportunities and challenges. It concludes by identifying three key areas where additional customer satisfaction research is needed.