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In the 1980s, a new customer satisfaction model, known as the Kano model, grabbed the attention of many marketing practitioners and researchers from a wide range of industries. Named after its creator, Noriaki Kano, a Japanese academic and consultant, the model challenged traditional customer satisfaction models that stated that more is better (i.e. the more you perform on each product/service attribute, the more satisfied customers will be).
Kano isolated and identified three levels of customer expectations, that is, what it takes to positively impact customer satisfaction:
While the Kano model was originally designed to describe customer expectations of certain product characteristics, it can be used to describe other relationships as well.
I recently thought of the model when working on Benchmarking CSR Scope and Standards, the second report in our four-part Corporate Social Responsibility in Procurement research series, expected to go live tomorrow. The report investigates CSR standards based on the ISO 26000 listed CSR core areas (e.g. environment) and their respective elements (e.g. sustainable resource use).
One of the key findings highlights that companies predominantly use CSR as a risk mitigation tool. As such they pick and prioritise those CSR areas most closely associated with risk, legal in particular. On the other hand, companies de-prioritise those CSR areas which present little to no risk to their organisations, and these include community involvement and development activities.
Back to the Kano mode. As many companies might have discovered by now, CSR has great marketing potential. But there is one caveat: customer expectations. A company could barely promote its health and safety measures when this is already expected not only by customers but also by the law (must-be requirement). However, the marketing opportunity grows with CSR activities that a customer wouldn’t necessarily expect (attractive requirement), such as fair competition or community development programmes.
If companies want to effectively market their CSR programmes, they will need to move beyond risk mitigation and go the extra mile to not only get customer’s attention but more importantly, their loyalty.
You can find out more about the report here.