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White Hutchinson Leisure & Learning Group, Kansas City, MO, USA

What a difference 'highly satisfied' makes

This issue's article, Androcentrism, the curse of male-bias (www.whitehutchinson.com/ news/ lenews/ 2005/ 04/ article102.shtml#article) , discusses how most location-based entertainment (LBE) facilities are designed and managed by men from a male-perspective when the focus should be on the primary decision-makers, women and moms. What difference does this really make to profitability? The difference is between being OK - satisfying guests - and having them highly satisfied because you were 100% focused on their needs and wants.

A Harvard Business School case study of Starbucks indicates the difference can be significant. Part of the study looked at the difference between satisfied Starbucks customers and highly satisfied customers - those who are not only loyal, but also recommend Starbucks to friends. Here's what the study found:

• Satisfied customers visit 4.3 times per month, spend $4.06 each visit and are loyal for 4.4 years
• Highly satisfied customers visit 7.2 times per month, spend $4.42 each visit and are loyal customers for 8.3 years

When you do the math, the result is rather telling:

What it boils down to is that a highly satisfied customer is worth almost twice as much as a satisfied one in annual revenue - and almost 3.5 times as much over the life of the customer with the business. This doesn't include the marketing value of highly satisfied customers recommending the business to their friends.

What this case study demonstrates is that in today's competitive marketplace, satisfied customers are no longer the road to profitability. Only highly satisfied customers will get you there. This requires a clear focus on who you are targeting and a design and operation concentrated on customers as sharply as a laser beam. And if you think this principle doesn't apply if you have the only LBE in town, think again. What you are competing for is not only share of wallet, some of your customers' disposable dollars, but also share of watch, for an hour or two out of your guests' very time-pressed life, in which they have many options for spending their valuable leisure time. Tons of choices exist, and only those choices that rank highest on the 'satisfaction scale' will win.

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