Ignoring CSAT Research Consequences

Often on this website we discuss ideas for what "might" happen. But sometimes there is direct evidence about the importance of researching customer satisfaction that occurs within major industries all over the US and abroad – evidence that serves as an example of why it is so crucial to know how your customers will respond to the way you run your business. In the news of late is one such example. Netflix is currently going through a customer satisfaction nightmare, and while the details of their thought process have not been released, it's obvious they did not gauge the way their customers would react.

There are a lot of factors that go into customer satisfaction. Service, support – all of these are important.

But with every business, price is almost always one of the greatest contributing factors, because customers are willing to sacrifice more when the price is less. So the last thing you want to do is have a price increase if you can prevent it, especially without offering any better services. Even worse is if you decide to initiate the price increase without notifying your customers that they are going to experience the price increase.

Even worse is if you are also rebranding your business – but only one section of your business – without any explanation. Even worse is if all of this also occurred after they lost a contract with a company that supplied them with a large percentage of the products they were offering. Over the past few months, Netflix has decided to make all of these changes – changes that are currently causing considerable losses to the business.

Not only did they increase their prices, rename one of their services, and lose a contract with Starz Entertainment – they did all of these things without consulting with or notifying their customers.

It's difficult to know why Netflix decided this was a good business decision, and it is likely that Netflix – especially with its brand recognition – will be able to survive. But this was very likely a bad decision made by those that decided their customer's thoughts and reactions were not important enough to measure. Their shares dropped more than 50% in just a few months, and it's hard to see how that price drop was not justified. Research your customers, so that you can avoid problems like those that recently affected Netflix.