Customer satisfaction is an indicator of the business success in pleasing its customers and satisfying their needs. The customer satisfaction is comprised of various elements such as perceived quality of the product and the service, customer expectations of the retailer, the price performance ratio, customer loyalty and the overall customer satisfaction with the provided service. The increased customer satisfaction can also lead to an increased sales performance of the retail business (Gomez et al, 2004). The elements that are taken into consideration when determining customer satisfaction as a target for the marketing strategy include store attributes, product and service offerings and customer profile.
A study published in marketing research news highlighted how the satisfaction level of the customer, the loyalty that the customer has towards the company and the brand and the commitment the customer shows towards the company impacts service based business. This is relevant to the retail businesses as the offerings provided by them to the customers is a combination of product and service based offering. The results of the study highlighted that “company satisfaction was not interpreted as a conceptually distinct construct from customer loyalty. A conceptual overlap also emerged between attitudinal loyalty and loyal behavioural actions such as word of mouth; whereas customer commitment was highly positively associated with loyalty (and satisfaction), according to expectations.” (‘Customer Satisfaction, Loyalty and Commitment in Service Organizations: Some Evidence from Greece’, 2006)