Measuring customer satisfaction should be an important metric that points to your success. If you have roving sales but are faced with raging customers, then there is something fundamentally wrong about your business. There are many tools for measuring customer satisfaction, but the first part which you need to get right is the conviction that you need to get feedback from your customers.
Three of the most popular methods for measuring customer satisfaction are as follows:
- Customer Satisfaction Score (CSAT)
- Customer Effort Score (CES)
- Net Promoter Score (NPS)
1. Customer Satisfaction Score
It is easy to guess that this is one of the survey methodologies for measuring customer satisfaction. It is calculated by measuring the answers to the questions asked on a scale. It could be as simple as “How happy are you with the product?”. The survey corresponds to a scale, there is no universal number for the scale, and it could be 1-3, 1-5 or 1-10, in fact, any random number.
The specialty about this method is that it is extremely simple for the customer to answer. You can easily get the customer to respond, thanks to the scale which makes it specific. As someone who is interested in measuring customer satisfaction, you can see the level of satisfaction you achieved.
There is no requirement on the part of the customer to outline any of the experiences in words, it is usually a radio button where the answer needs to go. Since there is less time taken to finish this type of customer survey, you can apply this for multiple experiences for measuring customer satisfaction.
When should you use CSAT?
The best time to send a CSAT survey is after you complete at least one milestone with the customer, it could be after onboarding, after the installation and setup or even after the first service. It is so because at this point the customer would have a decent idea of the kind of service that is being offered. Another advantage is that if you send a survey after each milestone, you would know how you fared as a business and you have got time to take corrective measures.
You can conduct the survey at many points in the customer journey. The results from the survey should be taken into cognizance and steps taken to ensure that the customer gives the highest rating possible on the scale. Conducting these surveys constantly will keep you on track even if there is no feature added or any major launch planned. This constant feedback will be helpful for you to monitor your progress and act accordingly.
How to implement CSAT in your business:
Getting a high CSAT score is the dream of most businesses, once you have the numbers that show what a customer thinks about your business, the next question that begs is how you use that information for your business.
Experts agree that CSAT score of 3 or less requires immediate follow-up. By getting feedback for existing services and products, you can measure your customers’ satisfaction and meet customers’ expectations by making improvements. By engaging with customers during many levels, you make them feel valued and in turn, increase their loyalty. Take an inside look as well by getting to know what your employees think about your company by asking questions and getting their feedback.
Advantages of using CSAT:
- It has high response rates
- The questions are usually simple and short
- Different types of rating scales can be used based on the context
- They are easy to implement and cost-effective
Disadvantages of using CSAT:
- Since it is based on the last association for a customer with the company, it shows short-term sentiment
- One can never know what a good or bad score is because benchmarks differ across industries and companies
- Customers who are “dissatisfied” and “neutral” do not fill out surveys usually
2. Customer Effort Score (CES)
It is the type of customer satisfaction survey that measures the ease of an experience with a company for a customer. For example, when a customer buys a product, uses a new feature or does any other action, the question asked is how easy did the company make it for them to complete the action. The ease of a given experience is a definite predictor of customer loyalty than directly measuring customer satisfaction.
This method doesn’t ask if a customer was satisfied, but it instead concentrates on asking them about their experience. It is said that the easiest way to gaining customer loyalty is by making it easy to get the job done and not just through overtly wooing your customers.
In a CES survey, after the question is posed, it is followed by options ranging from ‘Strongly Agree’ to ‘Strongly Disagree’ with other options in the middle too. There are also surveys that ask a Yes/No question. After answers to these questions, give the option to a customer to add any additional comments or an explanation as to why they gave that particular score. Answers to these questions will give the business ideas on where there have been pitfalls in terms of service and take appropriate action.
What should you use CES for?
CES is the best method to use to see if you want to optimize the loyalty of your customers. Why? Because it helps you understand if there are any hassles that you need to get rid of and if there is any customer effort that you can reduce. Here is how you can make the most of CES:
Use it as a real-time feedback system:
When you get your Customer Effort Scores, it shows if customers are unhappy during a particular interaction with your business. Getting feedback at regular intervals helps you keep on top of your customer’s problems so that it can be solved and measures were taken at each step. If a customer had to take a lot of effort to complete something, an account manager from your team can reach out to the customer to apologize for the inconvenience and educate them better.
See the distribution and analyze it:
In the CES metric, you need to be aware of both the distribution scores and the average because scores of 1’s and 8’s means something is wrong even if the average is 6. There are chances that some customers might be experiencing a torrid time not able to navigate around your offering at all. When you analyze the distribution, you can see if the effort taken by customers is usually normal and effortless or are there a particular set of people who are finding it extremely difficult. If there are, find those people and take action to reduce their effort.
Find areas that take high effort:
CES helps you to identify if there are specific areas for customers that they find really difficult to work on. If it is only one section of people having that issue, you can get on a call with them to discuss their travails. But if the pattern is widespread for everyone, you might need to devise ways to make the process easier for them. Find out the areas where the CES score is lesser than the average score and work on them specifically.
Advantages of using CES:
- High CES scores indicate that customers will purchase in the future. This is not something other methodologies will be able to predict.
- The results are highly specific.
- It can predict if customers will indulge with referrals. It is mostly likely to happen when there is a high CES score.
- You can easily identify between a positive and negative experience.
Disadvantages of using CES:
- There is no segmentation of customers
- It cannot measure aspects that is outside of customer experience
- CES doesn’t address why someone is facing a difficulty using your product
3. Net Promoter Score (NPS)
The Net Promoter Score is a powerful measurement of client satisfaction which asks only one question. Fred Reichheld, a Management Consultant of Bain & Company developed this customer loyalty metric in 2003. The objective behind this metric is to determine a clear and easily identifiable customer satisfaction score which can be compared over time between different industries.
NPS measures the extent to which a customer is willing to recommend your business’ products or services to their family and friends.
The question is framed in the method below:
“How likely are you to recommend brand/product of X to your friends, family, and colleagues?”
The answers can be graded on an 11-point rating scale with ‘0’ being most unlikely and ‘10’ being most likely.
The respondents can be divided into 3 categories based on the Net Promoter Question:
Promoters: Responders who give 9 or 10
Passives: Responders who give 7 or 8
Detractors: Responders who give any score between 0 and 6
The Net Promoter Score is calculated as the difference between the percentage of Promoters and Distractors. i.e. NPS= %Promoters-%Detractors. Here’s a free NPS calculator to check your score.
Let’s say you have 30% Promoters, 50% Passives, and 20% Detractors, then the NPS will be +10. Wonder what is a good NPS score to have? Any positive NPS is considered as good.
NPS is used in many large companies as a customer feedback tool. The resultant number is unambiguous and easy for all stakeholders to understand as an input to steer the business forward. NPS can be tracked over time and can also be used as a benchmark for various products and areas or even check your score against the industry average.
Reduce the Passives and Detractors by asking them a follow-up question and act upon their complaints. This will boost the percentage of Promoters and thus your NPS can be increased.
Why should you use NPS?
With NPS, you are asking your customers point blank if they liked using your product and would they be willing to say good things about your product/service to their friends and family. These days opinions spread faster over social media channels and all of this boils down to word-of-mouth, it is imperative that you measure your favorability in that aspect. In fact, positive NPS scores have a direct correlation with success of the business. From startups to some of the largest corporations in the world do not shy away from asking their customers point blank if they would recommend their business or not. NPS is simple, quick, benchmarkable, quantifiable and standardized, making it one of the most popular customer satisfaction metric.
Advantages of using NPS:
- Functional and Interpretable for every stakeholder
- It allows you to measure at which stage of organization you are in the growth process
- Since many companies use NPS, you can easily benchmark and see how your organization compares with your competitors
- Trusted by some of the biggest brands in the world which is a measure of its effectiveness
Disadvantages of using NPS:
- The model is too simple.
- It cannot accurately measure customer behavior because people who claim that they will recommend might not necessarily do so.
- It only takes the present customers into account while non-customers are ignored and they are usually the biggest source of Passives and Detractors.
Measuring Customer Satisfaction: Comparing CSAT, CES, and NPS
We have given an outline of each of the three means of measuring customer satisfaction so that you are more equipped to choose one of the best online survey tools based on your requirements. It should be clear by now that there is no one-size-fits-all tool for measuring customer satisfaction. Instead, it depends on your business needs and the customer interaction stage at which you are present. CSAT is a useful metric to measure the short-term happiness of your client while NPS focuses on measuring long-term happiness which is why the latter is said to be a good indicator of customer loyalty.
When you compare CSAT and NPS, it can be easily argued that NPS is a better predictor of customer behavior and speaks a lot about company growth as well. CES provides plenty of actionable information but doesn’t give the motivations behind those actions. It can be concluded that all of the methods should be used in conjunction to get a holistic overview of what the customers expect from you and what they think about your product/service so far.
The best results will flow when you ask more questions to the customers and dig much deeper to understand the motivations behind their answers. Using the troika of NPS, CSAT and CES along with follow-up questions based on which you take actions will give you success.
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