Master These Customer Satisfaction Metrics And Get Inside Customers’ Heads!

Metrics covered:

• Net Promoter Score
• Customer Effort Score
• Customer Satisfaction
• Customer Service Satisfaction 
• Customer Churn Rate

Chances are, you already know how crucial it is to know how customers feel about your brand. 

Today we’re going to explore five important customer service metrics. Here’s how you can get inside customers’ heads…

1. Customer Satisfaction (CSat)

CSat is essentially the foundational customer satisfaction metric. With it you can monitor how generally pleased customers are with your product or entire business. 

How to calculate Customer Satisfaction

Measuring CSat is a very easy task. First, present customers with a scale and ask them to rate your company’s performance over a set range. 

The most common scales for CSat are ranged between 1-3 or 1-5. 

Next, you divide the positive responses by the sum of all responses and multiply by 100. The end result is a percentage, representing the percentage of satisfied customers. 

What’s considered a positive response?

You can’t go wrong with a smiley face / frowny face – that’s standard. 

On a numbered 1-3 scale, 3 is the positive response. On a 1-5 scale, 4 and 5 are generally taken as positive. (There is no widely agreed calculation for this metric.) 

The advantages and disadvantages of CSat

Advantages

• Customer Satisfaction is quick to discover and easy to understand
• Provides an easy target for service
• Generates good response rates since the question is simple

Disadvantages

• Cultural differences (hardwired differences) often mean some user groups consistently score predictably differently
• CSat isn’t standardized (no single scale), so can’t be used for benchmarking
• Most methods of calculating CSat include users who gave fairly different scores

Summary

Csat is a useful metric to monitor – but it won’t paint you the entire picture! 

You need to establish the best method to calculate CSat for your customers and stick with a single scale. Otherwise it will be impossible to monitor and compare progress over time. 

If you intend to achieve more with your CSat results, consider customer retention automation. That will help you pinpoint the customers who give you low scores… and prevent them from departing! 

Customer Effort Score (CES)

CES is awesome because it measures something tangible – the amount of work you’re making customers do. Effort is inversely proportional to satisfaction. 

How to calculate CES

To gather Customer Effort Score data, you’ll query customers on how easy it was to do business with you. 

You can measure effort using one of two common approaches. 

Using a scale of 1-3

Customers get three options: Easy, Neither, and Difficult.

You calculate CES by subtracting the customers who answered with ‘Easy’ from those who answered with ‘Difficult’.

The result is a score somewhere between -100 and +100 (with high positive numbers as your target.)

Using a scale of 1-5

This is the standard CES method.

In this case, respondents rate how easy it was to interact with your company, rating between 1 (very easy) to 5 (very hard).

Thereafter, you can calculate your effort score by dividing the sum of all the scores by the total number of respondents. 

Here, the lowest score is enviable.

The advantages and disadvantages of CES

Advantages

• The metric has one clear target – lowering customer effort
• CES has a strong predictive power for performance
• Can be very granular, allowing you to measure the effort of specific types of interaction

Disadvantages

• The scales are not standardized so it can’t be benchmarked reliably 
• CES isn’t broad; it’s limited to very specific experiences
• It doesn’t directly signal ‘satisfaction’. An ‘easy’ encounter can still be negative!

Summary

Customer Effort Score can be one of the most practical metrics for an inbound call center. 

It’s very important to discover where the friction points are. It’s equally important to have a strategy for how you’ll deal with them. (This is where No-Code automation comes into play...) 

Customer Churn Rate (CCR)

CCR isn’t generally considered a metric for customer satisfaction. But consider this: customer loyalty might actually be the best way to determine how customers really feel about you. 

How to calculate CCR

The good thing is that no surveys are involved in this one – you’re going to use data that you already have. 

That math is straightforward really. You need these numbers:

• How many customers you had at the start of a chosen period*
• How many customers you had left at the end of the same period
• Also how many customers you lost during that period

(*The chosen period is entirely up to you. However, businesses generally make it one financial quarter so that this metric lines up with other financial objectives.)

With this data, you can now calculate the customer churn rate. 

1 - Customers at the start + Customers that joined during the period of observation

2 - Customers that left your business

Dividing 2 by 1 and multiplying by 100 gives you the churn rate!

What is considered a good customer churn rate?

You should typically confirm with the benchmark for your industry to get a reasonable CCR target, but most industries stay below 8%.

Even then, this is one number that you want to bring as low as possible.

The advantages and disadvantages of CCR

Advantages

• CCR helps to identify trends in customer satisfaction
• CCR is easy to benchmark
• The metric ties closely to your company’s revenue

Disadvantages

• The metric fails to highlight details about the value of individual customers
• Can be complicated for non-subscription businesses to monitor
• Action to suppress churn can cost more than the lifetime value of customers

Summary

It’s hard to run a successful business unless you keep your churn rate in check. The key thing to remember is that every customer you lose goes to your competition – so you’re really losing twice!

(Boost your customer retention rate with these autodial software hacks!)

Net Promoter Score (NPS)

Put simply, NPS tells you how highly customers regard your service. This is evaluated in terms of how likely they are to recommend you to others. 

How to calculate NPS

First, you ask customers a very specific question: “How likely are you to recommend us to your friends and family?”

The wording is totally up to you, but you must stress the question around the likelihood of a recommendation!

If you wade too far from this format, you won’t get a true NPS. 

Once asked, customers will rate you on a scale from 0 to 10. (A common error is rating from 1-10. This also invalidates your results.)

After a considerable time of collecting, you group the feedback into three groups:

1. Promoters – people you’ve impressed and who will recommend you to others (scores 9 and 10)
2. Passives – people undecided about the idea of recommending your business (scores 7 and 8)
3. Detractors – people who are outright displeased (scores 0 to 6)

With the three groups now apparent, you’re going to subtract the number of detractors from the number of promoters. 

The equation looks like this:

NPS = [ (# of promoters - # of detractors) ÷ # of responses ] × 100

The end result must be a score between -100 and +100.

The advantages and disadvantages of NPS

Advantages

• It’s easy to benchmark since NPS is a standard metric
• NPS correlates with business growth
• It’s an easy metric to monitor over time

Disadvantages 

•  It groups customers with wildly different perceptions (customers who scored you a 0 are treated the same as those who that scored you a 6)
• The template question may not work well for certain industries. When a product is extremely niche, customers are less likely to genuinely recommend it
• There are several ways to reach the same score, which makes it seem arbitrary (see below)

As you can see, there are three ways to get an NPS of 25. But which of these companies would you rather be?

Summary

NPS is not mandatory. However, there are certainly some useful insights to be obtained, and it’s good to have a simple score to guide you. 

It certainly helps to be granular with your score. Say you have a lot of detractors; did they mostly give you fives and sixes? Or zeros? 

(Want to perform NPS surveys… affordably? Read ‘4 Quick N Easy steps to a blended contact center.’)

Customer Service Satisfaction (CSS)

CSS is only slightly different from regular CSat, so we won’t spend too much time on it. 

The key difference is CSS only investigates specific interactions – not your business as a whole. 

For example, you can place a CSS question at the end of a phone call, IVR system interaction or webchat. 

How to calculate CSS

Just like CSat, CSS uses a simple scale (most often 1-3 or 1-5).

There are two ways to use the results:

1. Group the results into ‘positive’ and ‘negative’. Divide the positive responses by the total number of responses and divide by 100. The result is the percentage of positive responses. 
2. Add all the scores together and divide by the total number of responses. The result is the (mean) average score you received. 

The advantages and disadvantages of CSS

Pros

• Sums up the quality (over time) of specific touchpoints
• Generally high participation rate (especially with a 1-3 scale)
• Can pinpoint highly specific friction points

Cons

• Does not contextualize low scores
• Can’t tell you anything about broader product concerns
• Is often blind to multi-channel journeys

Summary

CSS is a very useful tool for the contact center. That’s because it can tell you something specific about your service, rather than about product issues beyond your control. 

However, it’s hard to gauge the experience of customers whose interactions crossed several channels – something which is increasingly common. 

Overall, if you want to measure any customer satisfaction metric reliably, you need automation. 

Everything from selecting the best customers, to sending surveys, to compiling responses – you can automate it all. 

Ready to learn how? Then grab Your (free) Guide to contact Center Automation now!