7 Best Customer Experience Metrics To Grow Your Business
Customer experience is all about customers’ likes, dislikes, and how you treat them. It’s based on both tangible and intangible metrics like numbers and emotions. To manage the customer experience as a one-time project is easy, but to remain consistent with it isn’t easy. If you lose any string from the CX panel, the entire customer experience program will collapse. It takes years of practice and A/B testing to build a particular CX program.
Customer experience professionals will be at maximum risk as they try to hold back and retain customers. Gone are the days when customers wait for days to sort out any issues with the product or service. Today, they look for instant resolution at their door-step. Any deviation in pleasing them is a reason to lose them to competitors. That’s why companies are setting-up major escalation channels to sort out customer complaints or grievances instantly.
Metrics always counts customer experience. These metrics decide the pain points and areas of improvement. KPI’s are also linked to CX to make way for finances to implement CX projects. Data plays a vital role in fostering decision making. If you’re planning to implement a robust CX strategy to bring back lost customers, retain existing customers, or bring new customers, here’s seven customer experience metrics to grow your business.
Net Promoter Score (NPS)
Net Promoter Score (NPS) is customer satisfaction and loyalty metrics derived by asking customers questions on their present experience and how likely they are to recommend your product or service to other customers on a broad scale of 0–10. It is considered to be a predictor of business growth. And one of the most simple and accurate used metrics. In NPS, customers are divided into three categories — detractors, passives, and promoters, depending on how they answer. They are asked a standard question — “How likely are you to recommend this brand to others,” which gives the brand a good idea if their CX efforts are creating positive experiences or not.
Formula for NPS: NPS = %Promoters — %Detractors
Customer Satisfaction (CSAT)
Customer Satisfaction (CSAT) is based on customer interaction with the brand. It measures the satisfaction score of the customer and how satisfied they are with your service. Customer satisfaction is a traditional approach to customer experience but still one of the most important parameters. Generally, CSAT is used for short term interaction like rating the customer service representatives on the call or making a return. Customers are asked to rate on a scale of 1–5 — “How was your overall satisfaction level with the brand”? One stands for Not at All Satisfied, and five stands for Very Satisfied. CSAT surveys are often given within a few hours of the event, which helps brands measure satisfaction promptly.
The formula for CSAT: All positive responses X 100
Total number of responses
Customer Effort Score (CES)
Customer Effort Score (CES) metrics is the effort a customer has to deploy while using the product or service, or towards finding the information they need or getting the issue resolved. It’s relatively new to NPS & CSAT but easy to understand and change things quickly. You can ask customers — “Was it easy to deal with our brand today?” on a rating of Easy, Neither, or Difficult. The positives are subtracted from the negatives to get the CES. CES helps companies determine customer grinding levels and create a way out for a more seamless experience.
The formula for CES: Sum of all individual customer effort score X 100
Number of customers who provide a response
Customer Engagement
Customer engagement metrics measure the time a customer spends on your website, mobile app, or any other assets. It shows how engaged they are other than making any purchases. Businesses spend tons of money and focus their efforts on creating great user experience to give customers what they want in the best capacity and provide assistance whenever they want. Metrics like activity time on your website, frequency visit of customers, and core user actions are few measures of customer engagement. Customer engagement asks questions like — “Did you find the content relevant to your interest?” on a scale of Happy to Unhappy. Customer engagement uncovers user engagement with your product or service and helps brands make changes accordingly.
The formula for Customer Engagement: (w1*n1) + (w2 * n2) + … + (w# + n#)
w — weight for a random event and n — number of times the event occurred.
Customer Retention
To boost revenue and increase growth, start with retention. Customer retention metrics define how many customers you retain over a while or how many customers came back for a second purchase. Retention is the key to long-lasting growth. To improve retention, you’ve to work on reducing customer churn. Customers stay with brands or prefer brands that have a pricing structure that doesn’t change frequently. Customers are asked open-ended questions like “Why did you choose this brand? Please comment below?”. Open-ended questions give customers the freedom to put down their thoughts and elaborate in the best manner. Strong customer engagement often intrigues customers to return, which reduces overall cost and saves on acquiring new customers.
Customer Acquisition
Customer Acquisition metrics is the acquisition effort performed over some time versus any other time. By comparing customer acquisition cost, you can tell the number of new customers your business has acquired. Customer acquisition always differs from customer retention. Customer acquisition costs include marketing, training, customer experience, support, and data. The goal is to keep acquisition costs low without compromising on potential new customers. If you have a strong business acumen backed by strong customer experience, your company will get referrals, which will ultimately reduce acquisition costs and get new customers that are likely to stay. New customers bring new business and increase profit.
The formula for customer acquisition: $ spent on sales & marketing + other variables # of customers
Sales
Every big or small company focuses on sales to grow their business. It’s one of the parameters that trace the bottom line of a business, and see if the sales increase after implementing or changing the CX strategy. Customer experience tends to bring in more sales and customers. Existing happy customers act as brand ambassadors and endorse your brand to their friends and family. New customers often look for a brand that is sustainable with a decent price mix. The mix-and-match of customer satisfaction and loyalty helps sales a lot, so the number should ideally increase with more emphasis on customer experience.
The formula to calculate sales growth: (S2 — S1)/S1 * 100
S1 — the net sales for the current period
S2 — the net sales for the prior period
Conclusion:
While NPS, CSAT, and CES are overall measures of customer experience, other metrics like customer loyalty, customer retention, customer acquisition, sales allow us to concentrate and dig deep into most of the business pain areas and find the opportunity to grow. It’s not only metrics that define business growth but continuous improvement in each of the metrics we use.
The best customer experience program is a combination of different metrics put together to ensure data gathering at every touchpoint and focus on actions that will have the biggest impact
Author: Krause Leia
Krause is a passionate content marketer and a market researcher who is on the spree to capture multiple facets of industry through creativity and innovation. Krause is a content geek who writes for market research, digital marketing, and startup niches.
