Customer satisfaction is dynamic and relative. Just the thought “client-driven” can enable organizations to enhance fulfillment and keep client genuinely, on the other hand, if competitors enhance consumer satisfaction, at that point it might misfortune corporate clients. While enhancing consumer satisfaction, client expectation should not be ignored, service quality, product quality, and value for money have an immediate positive effect on consumer loyalty.
Satisfaction is also influenced by customer’s emotional responses, their attributions and their perception of equity (Zeithal ; Bitner. 2003, 87-89. Employee behaviour and engagement in service quality can lead to a satisfied or dissatisfied customer.
During 1960-1980, customer satisfaction measurement was initially considered as a problem of consumer behavioural analysis. The most important effort from this perspective was the following (Grigoroudis ; Siskos 2010):
Cardozo: The Cardozo model (1965) in (Gerson 1993) is one of the first research efforts in the area of customer satisfaction measurement. This approach is based on some of the major theories of social psychology, aiming at understanding the impact of satisfaction on future customer purchase behaviour. In particular, the model combines Helson’s “contrast effect” and
Festinger’s theory of cognitive dissonance. The adaptation level theory provides a conceptual framework, for understanding how consumers form product quality expectations, suggesting that the perceptual judgment of a person to incoming information depends on the individual’s current expectation level. The work of Helson (1964) on adaptation level theory, proposes that stimuli, resulting in a displacement of the adaptation level may also change an individual’s perception of other information in the series (i.e. a “contrast effect”). On the other hand, the theory of cognitive dissonance can account for the psychological consequences of disconfirmed expectations, since it proposes that people have a motivational drive to reduce dissonance by changing their attitude, beliefs and behaviours (Grigoroudis ; Siskos 2010).
Grigoroudis ; Siskos 2010 identified some advantages of customer satisfaction measurement programs;
• Customer satisfaction measurement programs improve communication with the total clientele, provided that they constitute continuous and systematic efforts from the organization.
• It helps organizations to examine whether services provided meet customer expectations and also to determine whether new actions, effort, and programs have any impact on customers.
• Customer satisfaction measurement programs help organizations to identify and find better ways of improving their customer service
• Customer perceptions and judgments will help determine organizational strengths and weaknesses to give them a better stand in the market.
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• It also makes employees to be vigilant and diligent in service delivery as customers are given the chance to evaluate services which are offered to them
• Customer satisfaction may not be the only sufficient condition to a good financial standing but several researchers have shown a significant correlation between customer satisfaction level, customer loyalty and profitability
Other researchers also identify some disadvantages of customer measurement programs;
• Rust and Oliver (2000) say that a customer that is satisfied with a product or service will raise their repurchase frequency and future expectations and due to raised expectations of customers it will become more difficult for an organization to satisfy customers in the next purchase cycle. This might have a ripple effect on the company’s profitability
• According to Ciavolino and Dahlgaard, 2007, the company would be better of reducing the expectations and then deliver more than expected
• Rust and Oliver (2000) wonder whether satisfactions are a suitable goal to retaining customers. They argue that companies do not gain advantage and would rather end up increasing cost for trying to reach these higher customer expectations.
• Anderson, Fornell, and Rust (1997) further argued that productivity within the company will be damaged because of the cost and the search after customer satisfaction.
Furthermore, in addition to higher cost, the company must add more effort in improving product attributes or overall product design to keep satisfaction at the desired level
2.3 Customer Loyalty
Although it has been established that customer satisfaction breeds profitability, it is not a stand-alone factor to successful businesses. For a business to continuously survive in the thriving yet competitive market it needs to create a good image in the minds of its customers for them to make a decision to repurchase products and services. Thus, Oliver (1999) defines customer loyalty as a deeply held commitment to re-patronize a preferred product/service consistently in the future, thereby causing repetitive same-brand purchase, despite how situational influences and marketing efforts have the potential to switch customer behaviour. Thus customer loyalty was considered bi-dimensional, including both attitudinal commitment and behavioural repurchase intention, based on prior studies by Lin and Wang, 2006, defining it as the customer’s favourable attitude toward a brand, resulting in repeat purchase behaviour.
Thomas and Tobe (2013) emphasize that loyalty is more profitable. The reason being that expenses to gain new customers is much more than retaining existing ones. Loyal customers will encourage others to buy from you and think more than twice before changing their mind to buy other services. Customer loyalty is not gained by an accident, they are constructed through the sourcing and design decisions. Designing for customer loyalty requires customer-centered approaches that recognize the want and interest of service receiver. Customer loyalty is built over time across multiple transactions. As the figure below demonstrates, customer loyalty produces customer satisfaction, a repurchase attitude and encouraging others to patronize the products based on personal experience.
