The funding dilemma: how much is customer satisfaction really worth?
At the heart of this discussion is a more uncomfortable truth: businesses often fund customer satisfaction initiatives according to how much loyalty they believe they can extract for the money spent.
The cost of dissatisfaction, though delayed, always comes due
The more transactional the relationship, the less a company may care about long-term satisfaction.
On the one hand, businesses rely on customer retention for sustainable growth, and so they may pour significant resources into ensuring a smooth user experience. On the other hand, when growth plateaus or profit margins are squeezed, the first thing to get cut is often customer support.
Why? Because they know that a portion of customers will stay out of inertia, convenience, or lack of better alternatives—even if their experience worsens.
This “funding gap” in customer satisfaction manifests in various ways. Reduced staffing levels at customer service centres, providing fewer resources for resolving complaints, and moves away from voice solutions all serve to reduce costs but at the expense of customer satisfaction.
These actions aren’t accidental or the result of poor planning—they are deliberate choices made to preserve profitability.
Why the race to the bottom is risky
This intentional drive toward mediocrity in customer satisfaction comes with long-term risks. For one, it underestimates the power of negative word of mouth in the digital age. Social media, review platforms, and forums give dissatisfied customers a far-reaching voice, and once a brand’s reputation begins to sour, it can be difficult to recover.
Customers are not just numbers—they are influencers within their networks, capable of swaying opinion and driving potential customers away.
Moreover, the low-effort, low-reward approach to customer satisfaction creates a breeding ground for disruptive competitors. Start-ups and niche players that prioritise excellent customer service (often, innovatively, at a lower unit cost than traditional contact centres) can quickly gain a foothold by catering to underserved or disillusioned segments of the market. In fact, many companies have built their entire brands on a relentless commitment to customer satisfaction, often at a premium price point that customers are happy to pay.
By accepting a baseline level of dissatisfaction, companies may also be encouraging customer churn at a level far beyond what they may anticipate. When customers feel undervalued, they become far more likely to switch at the first opportunity, even if it means paying a premium elsewhere.
Are companies really calculating how much we’ll take?
The provocative question remains: are some companies truly calculating how much dissatisfaction their customers are willing to tolerate? The answer, in my opinion, increasingly appears to be “yes.”
There is a fine line between managing costs and eroding trust, and I believe many companies are walking it precariously. When businesses deliberately set the limits of customer satisfaction and choose not to fund loyalty adequately, they are gambling with their long-term viability.
The customer’s revenge: will dissatisfaction ultimately destroy brands?
For companies banking on the idea that customer dissatisfaction is manageable, the danger lies in underestimating consumer power. While the balance sheet may show cost savings in the short term, the reputational damage from consistently delivering poor service can accumulate.
Consumers have more choices than ever, and loyalty is becoming a rare commodity.
In a world where some companies may decide that a certain level of dissatisfaction is acceptable, it will be those that refuse to compromise on customer service that stand out.
Brands that overfund customer satisfaction—not just to the point of adequacy, but to the point of delight—will create lifelong loyalty that no cost-saving competitor can erode.
In the end, the companies that refuse to invest in customer satisfaction may find themselves victims of their own short-term thinking. The cost of dissatisfaction, though delayed, always comes due. The question is: will companies pay now, or will they wait for their customers to exact a much higher price later?
Call to action
Do you believe companies are consciously determining how dissatisfied they can let you be? Or is this simply a product of poor management?
Share your thoughts in the comments—especially if you’ve been on the receiving end of frustrating customer experiences.
About the author
Richard Jeffreys is the founder of CX ALL, a customer experience advisory company.
Richard has over 35 years of global leadership experience in banking and fintech, living and working in the US, Europe and Asia. He is passionate about customer and employee satisfaction and their correlation to sustainable commercial value. All opinions are his own – feel free to debate and comment below!
Follow Richard on LinkedIn.
