We all know that customer experience (CX) has become the prime competitive differentiator for today’s B2C and B2B businesses. Price, whilst important, is not the major deciding factor any more for non-commodity products. How we are treated, has become the priority.
What it boils down to is that we all want to be treated with courtesy and efficiency, and to receive value from those we give our money to. It doesn’t matter who we’re dealing with – banks, airlines, car yards, plumbers, event promoters, physios, shoe shops, schools, restaurants, consultants, web designers, sports clubs, insurance – we want great service and to be appreciated.
As Amex reported in their 2017 Customer Service Barometer survey:
- Over 50% of consumers scrapped a planned purchase or transaction because of bad service.
- 7 out of 10 say they’ve spent more money to do business with a company that delivers great service.
So if CX is the key to customer satisfaction and customer loyalty – how do we measure it in contact centres?
Customer experience metrics
Measuring the right thing is crucial for understanding what kind of experience your customers are actually receiving, if it meets their requirements, and where operations or activities need improvement.
Most contact centres focus on operational KPIs and metrics, such as first call resolution, average handling time, queue times, etc.
Customer experience is a multi-faceted concept, as can be seen in this CX Framework diagram from the 2018 CCW Market Study – Performance and Metrics.
Whilst it means there’s an opportunity to impact the experience in many ways, it can be difficult to determine which data is important when it’s time to assess and optimise for improvement.
Here’s some suggestions on customer-centric metrics to review, rather than operations-centric metrics.
1. Track Conversion Rates
The percentage of interactions with customers that result in achievement of your targets, or goals (a sale, an upsell, a donation, an overdue fee paid, a survey completed, completion of self-service transaction, etc) are called conversion rates.
Conversions are arguably one of the most important metrics for assessing the effectiveness of your customer experience. The higher your conversion rates, the more likely it is that your customers find your offers and service appealing.
After setting goals for each type of “campaign” or interaction you would like to measure, you then need a way to track conversions. With online transactions you can easily set up conversion tracking using Google Analytics or similar.
In contact centre solutions like Premier Contact Point, contact centres can set KPIs or goals for campaigns or contact types, and track conversions in real time. Or you can add a custom field to the contact record for team members to record outcomes and then run a custom business insight report to track conversion rates.
2. Track Customer Churn Rate
Loosely defined as ‘customer turnover’, this metric is ideal for businesses with recurring income products, or a product range that facilitates repeat sales. It’s helpful for analysing customer lifetime value.
Customer churn is a good indication of whether your offering or service levels meet customer expectations.
Your churn rate is calculated by dividing the number of lost customers (subscription cancellation or lack of repeat sales) by the total number of active customers, over a certain period of time.
3. Track customer sentiment
What your customers think is very important and one of the key indications of the CX you are actually delivering.
There are three popular methods of measuring customer sentiment, and each has their pros and cons. See our article 5 Tips to Designing an Effective Customer Satisfaction Survey for more comprehensive details.
Customer Satisfaction Score (CSAT)
A CSAT survey consists of one or more simple questions relating to satisfaction with product, service or experience, and customers are asked to rate their satisfaction to each question on a scale. The final score is the average of their rating for each question.
The limitation of CSAT is that it focuses on a specific interaction (support event or product) and not on the wider relationship with your organisation.
Net Promoter Score (NPS)
NPS is designed to measure long-term happiness and predict customer loyalty by asking customers to give a rating out of 10 to this question: How likely would you be to recommend our company to a friend or colleague?
People scoring 0-6 are known as detractors, those scoring 7 and 8 are called passives, whilst those scoring 9 and 10 are called promoters.
NPS helps you gain insight into customer loyalty and whether or not they’d want to be associated with your brand.
Customer Effort Score (CES)
An effective CX sentiment measure is CES, whereby your customers provide you with an overall score of how hard it was to achieve their goal (get help, make a purchase, solve a problem, etc).
The post interaction survey presents two or more statements or questions about service elements and asks customers to rate from hard to easy etc.
When the scores are aggregated, a high average indicates that you’re making things easy for your customers, whilst a low number means that customers need to put in too much effort to get help from your company.
The benefits of measuring CX
When you analyse a combination of CX metrics such as those mentioned in this article, you are effectively receiving a reality check. The metrics don’t lie – they show you what your customers actually think of your company, your offerings and your service.
It’s highly valuable data that provides the starting point for delving deeper into the results to determine:
- Which type of interactions receive consistently low or average customer sentiment scores
- Which goals are not achieving desired conversion rates
- Which products / services have the highest churn rate of customers
The next stage is to find out why. The metrics will show you where and when problems are occurring – at which point(s) within the customer journey.
The purpose of improving CX is to increase customer satisfaction, which in turn impacts customer loyalty.
Increasing customer loyalty is the prize, because in the end, it reduces your customer acquisition costs. To achieve it though involves knowing what to measure and what actions are needed to improve satisfaction. Things like having the right offerings, providing effective self-service and live support options, and reducing customer (and staff) effort. All of these directly impact customer satisfaction, and ultimately customer loyalty.