#3 Key metrics Customer Satisfaction measuring

?? Welcome Back to Your Customer Success Journey! ?? Reading Time: 5 minutes??

Hello, CX Enthusiast! ??

?In Week 2, we explored the power of customer journey mapping to understand your customers’ experiences and identify opportunities for improvement. This week, we’re zooming in on the key metrics that will help you measure customer satisfaction.

What Are Key Metrics for Measuring Customer Satisfaction? There are several critical metrics businesses use to measure customer satisfaction. These metrics help you quantify how your customers feel about your products, services, and overall brand experience. Let’s take a look at the three most popular metrics:

1. Customer Satisfaction Score (CSAT) : The Customer Satisfaction Score (CSAT) is one of the most straightforward ways to measure customer satisfaction. It asks customers to rate their experience with a product, service, or interaction. Typically, this is done with a simple survey after a key touchpoint (like a purchase or customer service call).

• Example Question: “On a scale of 1 to 5, how satisfied were you with your experience?”
• Pragmatic Example: Imagine a restaurant that uses CSAT surveys at the end of a meal to gauge customer satisfaction. If a majority of diners rate their experience as 4 or 5, it’s a strong indicator that the restaurant is delivering on its promises. If scores trend lower, the restaurant knows it needs to investigate why and make improvements.

According to Frederick F. Reichheld, in his book “The Loyalty Effect,” CSAT scores can predict customer loyalty. Reichheld emphasizes that satisfied customers are more likely to remain loyal and recommend your business, making CSAT a valuable tool for tracking loyalty over time.

2. Net Promoter Score (NPS) : Net Promoter Score (NPS) is a powerful metric designed to measure customer loyalty and satisfaction by asking a simple question:

• “How likely are you to recommend our company to a friend or colleague?” Customers respond on a scale from 0 (Not at all likely) to 10 (Extremely likely). Based on their responses, customers are categorized as Promoters (9-10), Passives (7-8), or Detractors (0-6).
• Pragmatic Example: Consider a software company that surveys its customers post-purchase using NPS. After analysis, they realize that a large portion of their customers are Detractors, rating the company between 0 and 6. This signals a red flag that something in their experience is going wrong. The company follows up with the Detractors, identifying specific pain points in the onboarding process. By addressing these issues, they are able to convert many Detractors into Promoters.

Fred Reichheld, who pioneered the NPS methodology in his book “The Ultimate Question 2.0”, states that businesses with higher NPS grow faster than their competitors. NPS isn’t just a measure of satisfaction, it’s a predictor of future growth.

3. Customer Effort Score (CES) : The Customer Effort Score (CES) measures how easy it was for a customer to complete a specific task, such as making a purchase or resolving a customer service issue.

• Example Question: “On a scale of 1 to 7, how easy was it to get the help you needed?”
• Pragmatic Example: A telecommunications company uses CES to assess the ease of resolving customer service issues. If customers report that it was difficult to solve their problem, the company can pinpoint areas where their support process is too complex and work to simplify it. Simplifying processes leads to a smoother experience and greater customer satisfaction.

In the book “The Effortless Experience” by Matthew Dixon, he argues that reducing customer effort is more important than delighting customers. Companies that focus on making interactions easy - seamless - for customers tend to have higher retention and satisfaction rates.

?Why These Metrics Matter? Tracking these key metrics allows businesses to:

• Identify Areas for Improvement: Low scores signal weak points in the customer journey, prompting companies to investigate and take action.
• Predict Customer Loyalty: Metrics like NPS can give insights into customer loyalty and whether customers are likely to stay with your brand or churn.
• Drive Continuous Improvement: By regularly tracking and comparing results, companies can fine-tune their strategies and focus on what matters most to their customers.

How to Use These Metrics Together: Rather than relying on just one metric, businesses should use a combination of CSAT, NPS, and CES to get a more complete picture of customer satisfaction. Each metric provides unique insights:

• CSAT helps with short-term customer satisfaction.
• NPS gives a measure of long-term loyalty.
• CES highlights the ease of customer interactions.

Case Study – Online Retailer: Improving Customer Experience with CES and NPS

An online retail company struggled with high customer support costs and low repeat purchase rates. By using Customer Effort Score (CES) surveys, they realized that customers were frustrated with the return process. Many customers had to contact customer support multiple times just to process a return, making the experience cumbersome. At the same time, their NPS scores showed a large number of Detractors, particularly among customers who had tried to return a product.

By simplifying the return process (e.g., allowing customers to print a return label directly from their account), they were able to reduce customer effort and increase their NPS. A follow-up CES survey showed a 40% improvement in ease of returns, and the company saw a 15% increase in repeat purchases within three months.

?Key Takeaways:

• CSAT, NPS, and CES are essential tools for measuring customer satisfaction.
• Use CSAT for immediate feedback, NPS to gauge long-term loyalty, and CES to measure the ease of customer interactions.
• Regularly reviewing these metrics helps identify pain points and areas for improvement in your customer journey.

?Looking Ahead: Next week, we’ll dive deeper into the importance of Voice of the Customer (VoC) programs and how gathering and analysing customer feedback can help drive innovation and improve your overall customer experience.

Engagement Questions: we want to hear from you! ??

1. Which of the key metrics (CSAT, NPS, CES) do you currently use in your business?
2. If you’re not using any of these metrics, which one are you using and why?

Let’s continue the conversation – join the discussion on LinkedIn! ??

"Track what matters to improve customer satisfaction, build loyalty, and grow your business with actionable insights."

Best regards, Mot-EX Customer Experience Team