Does It Matter Which Customer Experience Metric You Choose?

Note: I published this post a few weeks ago in CMSWire and lots of people found it useful. In case you missed it, here it is again.

Are you responsible for measuring the progress your company is making in improving customer experience? If the answer is yes, I’m sure that at some point you needed to decide which metric (or metrics) to use for that job. Did you choose the ubiquitous Net Promoter Score (NPS)? Or perhaps CSAT, the traditional customer satisfaction metric? And don’t overlook the more recent entry, the Customer Effort Score (CES). 

Is one metric enough, or should you use several metrics? Does it matter? Perhaps you don’t need a metric at all.

Let’s take a look at the factors you should consider when choosing a metric, and then consider whether metrics really give you the insight you need to improve the customer experience.

Why Choosing the Right Metric Matters

Choosing the right customer experience (CX) metric matters to the extent that the metric must be meaningful to the specific customer touchpoint you want to analyze.

A metric such as Customer Effort Score (CES), which measures the ease of the customer experience on a scale from Very Difficult to Very Easy, will be relevant for touchpoints where ease of use is the primary driver, such as setting up a money transfer using online banking.

CES is ideal to use immediately after a customer interaction with a product that led to a purchase or a subscription, or after an interaction with customer service rep to solve a problem. You can also use it to measure the aggregate experience someone has with your brand or product in general.

Are You Measuring Perception or Attitude?

When choosing a metric, it is important to determine whether that metric measures customers’ perceptions or attitudes.

Perceptions are the views or interpretations a person forms about particular things. A person’s attitude is a more intrinsic part of his or her disposition and is often conveyed through words, behavior or body language. Other people can perceive our attitudes.

Attitude is a mindset or a tendency to act in a particular way driven by an individual’s experiences and temperament. Perception is an individual’s interpretation of something. Remember that when choosing a CX metric, and decide what you want to measure — attitude or perception.

What’s the difference? In a 2014 blog post titled “Customer Effort, Net Promoter, and Thoughts About CX Metrics,” Bruce Temkin, managing partner of Temkin Group, a customer experience consultancy, explained that, “In general, perception measurements are better for evaluating individual interactions.” Discussing the specific examples of Customer Effort Score and Net Promoter Score, he said, “CES is a perception measure while Net Promoter Score is an attitudinal measure” and concluded that “CES might be better suited for a transactional service while NPS may be better suited for a relationship service.”

For example, when people assess the experience of dining in an expensive restaurant, they base their judgments less on the individual transactions (ordering, eating, paying) and more on how they feel after the fact. So a metric like CES won’t make sense in that situation.

Is the Metric Valid in Your Industry?

The metric you choose needs to be relevant for your particular industry.

For businesses such as restaurants and chiropractors, for example, word of mouth is key. Those types of businesses are the subject of a lot of person-to-person recommendations, and those recommendations are based not on price or ease of use, but on quality of service.

When it comes to some financial services, we find that as many as 10 percent of customers’ comments say something along the lines of “I do not recommend banks.” That response seems to be based on a firmly held principle, but where that attitude comes from is unclear. It could have historic or cultural origins. For centuries, people lost money because banks failed. So some people may be using financial services but not fully trusting the institutions that provide them. Also, in many cultures, talking about money is just something people do not do.

In my view, you can use a metric such as CES or NPS to gauge how you’re doing and to get a broad idea of whether you’re headed in the right direction. If not, there should be a system in place to give you clear indication as to what is causing the problems. And you should ideally have an automated system in place to alert the relevant departments as to which customers are at risk, what types of problems the business is having, and what you could do to improve CX.

So it’s not just having a metric that’s important; it’s how you use that metric and how you implement the feedback collected throughout your organization.

As the Temkin Group’s 2013 State of CX Metrics report found, most organizations thought they were “good” at collecting and calculating CX metrics. Although their customer experience programs still faced a number of common problems, such as these:

• Limited visibility of CX metrics across the organization (58 percent).
• Lack of taking action based on CX metrics (57 percent).
• Poor communication of CX metrics (41 percent).
• Lack of resources for tracking CX metrics (39 percent).
• Too little compensation tied to CX metrics (36 percent).

In conducting the research for its report, the Temkin Group assessed the CX metrics programs of more than 170 large companies, specifically examining four characteristics that make CX metrics efforts successful: consistency, impact, integration and continuity. The firm’s conclusion was that only 12 percent of the companies had strong CX metrics programs.

Scores Alone Don’t Tell You Much

So even though your organization might be using a customer experience metric, there is no guarantee that it is going to be what you need to improve your customer experience, or that it is working the way you intended. Or that it helps you identify the factors that impact your CX positively or negatively.

Ultimately, your focus should be on customer feedback and less on scores. For example, if you did five things to try increase your score on a particular metric, and the score did increase, how do you know which of the things worked and were noticed by customers?

The score alone won’t tell you. But customer feedback will.

Whichever customer metric you choose to implement (and you may spend thousands of dollars doing so, not to mention the effort you put into training all of your employees to adopt it and use it in their customer interactions), the score is worth nothing if you don’t analyze the customer feedback you collect.

You are collecting feedback, right?

As Bruce Temkin says, “The choice of a metric isn’t the cornerstone to great CX. Instead, how companies use this type of information is what separates CX leaders from their underperforming peers.” The bottom, he concludes, is that “There is no such thing as a perfect metric.”

So it may not matter which metric you choose, but how you use the information does matter.

Michael Lowenstein, thought leadership principal at Beyond Philosophy, a customer experience consultancy, argues that “None of these customer experience metrics takes brand favorability and volume/type of positive and negative informal online/offline word-of-mouth into consideration.”

There simply isn’t one metric that does it all, so using a multifaceted approach to attack from all angles is the best way to go.

Know What Your Customers Are Saying

Today, it’s essential to be able to understand customer feedback sentiment and, importantly, the impact of customer feedback on your brand overall, including bottom-line metrics like revenue. By not just collecting feedback, but also analyzing it, you get access to real customer insights, and you can answer questions like these: What is holding our customers back? What’s driving positive customer experience? What delivers the wow moments?

My prediction is that, in the near future, businesses will gather data and feedback from all types of interactions and marry them up with drivers of loyalty, and behavioral metrics to then use predictive analytics to bypass these one-dimensional metrics.

Don’t stop measuring, but don’t put too much emphasis on whichever metric you are using. Focus on getting deep insights and taking action on them.