A happy customer is a loyal customer. A loyal customer is a buying customer. Simple as that. And to know how happy your customer is, you have to measure it. This step-by-step guide will show you how to measure customer satisfaction. Thanks to that, you’ll know how strong your relationship with a customer is, and which areas need to be improved.
Everything in the name of making your customers love you.
Because all you need is love… and more sales.
What is customer satisfaction? Why is it important?
To put it simply, customer satisfaction is the measurement of your customers’ happiness with your product, service, or specific experience.
Why is it important to measure customer satisfaction?
Well, the answer will not be surprising. A happy customer stays with your business longer. And you want to keep them as long as possible because acquiring new customers is 5-25 times more expensive than keeping the current ones..
And it’s not just about the costs, it’s about income as well. Increasing customer retention by 5% can boost your profits by up to 95%.
Making sure that your customers are satisfied is an effective way of increasing your income and making your business finances stable. And if your customers are not happy, you should quickly look for solutions.
But first of all, you have to find out what went wrong.
To do that, you’ll need a PLAN!
How to Measure Customer Satisfaction in 6 steps
1. Create a plan
What’s the point of measuring customer satisfaction without a plan? There’s none. You have to create a plan and set up clear goals.
Collecting the data takes time and effort (both yours and your customers’). If you’re doing it, make sure you have a purpose – there’s no reason to bother yourself (and your customers) pointlessly.
The main goals you can specify are:
- improving the quality of your product or service,
- improving customer service quality,
- improving any other customer touchpoints (e.g. website navigation).
Of course this list is just an example – feel free to set up any other goal if it’s more suitable for your business.
Next, I’ll show you how to measure customer satisfaction with different metrics.
2. Choose a metric
NPS (Net Promoter Score)
Net Promoter Score is one of the most popular metrics for measuring customer satisfaction.
This metric asks your customers how likely they will recommend your products or services to someone else. It’s great, because it’s fast, convenient and has got high response rate (it’s just one question).
Customers answer that question on a scale from 1 to 10, and then they’re divided into 3 groups:
- Promoters: customers who answered with 9-10
- Neutrals: customers who answered with 7-8
- Detractors: customers who answered with 0-6
Customers who fall into the category of promoters are considered as loyal customers, who are very likely to recommend your products or services.
And how impactful are such recommendations? Just look at the data below:
According to this report, word-of-mouth recommendations are 2nd and 3rd most powerful sources of information to customers! Promoters share the great experience they had with your business, that’s why you should focus on getting as many of them as possible.
The two other NPS groups of customers are neutrals and detractors.
Neutrals are considered as uncertain clients – they can either become your promoters or move to your competitors. Detractors are unhappy customers that are very likely to turn their backs on your business or even worse – share their bad experience with others.
How to calculate NPS? To do it, simply ask your customers how likely they are to recommend you to someone else, on a scale of 0 to 10.
After getting the data, all you have to do is subtracting the percentage of detractors (0-6 answers) from the percentage of promoters (10-9 answers).
You’ll receive a score from -100 to 100. The higher the score is, the more likely you’ll get a recommendation.
Low NPS score (below 0) means that you should start working on your customer satisfaction level.
CES (Customer Effort Score)
Customer Effort Score allows you to measure how easy it was for a customer to complete an individual action (e.g. ordering a product online or solving a problem using your product or service).
CES provides the strongest predictor of the future purchase behavior, according to an HBR study (which boosted this metric’s popularity back in 2010).
The study suggested that 94% of customers who responded with low effort, said that they would make a purchase again. 81% of clients responded that high effort in interaction with a company would make them share their negative experience with others.
CES survey usually consists of a simple statement, that a customer can answer on a standard 1-10 scale, whether they agree or disagree with the statement. The lower the score, the stronger the disagreement is.
The example survey looks like this:
Your CES score is the average score of your customer responses. The higher the score is, the easier it is to complete a certain task for the customer.
Getting answers below 6 may suggest, that there’s an issue regarding a specific process – and you should address it.
Besides the linear scale, it’s worth to give your customer an opportunity to leave additional comments (where they can explain their score). It’s a valuable piece of information, that’ll help you understand your customer’s rating and implement solutions later on.
CSAT (Customer Satisfaction Score)
Customer Satisfaction Score allows to measure customer satisfaction on interaction with your product, service, or overall experience.
It’s another great metric – it’s short, simple, and intuitive.
The scales range between: 1-3, 1-5, or 1-10 (ranges vary because of cultural differences in how people rate their satisfaction).
The example survey below measures overall satisfaction with Tidio’s customer service:
You CSAT score is the average score of your customer responses. A higher score means higher satisfaction with specific experience.
CSAT score works great with all types of customer service (be it in e-commerce or hospitality). Just like CES metric, it can be further enhanced with additional questions, which in turn could deliver valuable insights for resolving potential issues.
Just like with CES metric, it’s worth asking a customer some additional questions, which can provide valuable information for resolving potential issues.
3. Build a survey
I recommend using the most simple tool out there – Google Forms. It’s totally free, easy to use and allows you to build a good looking survey in 5 minutes.
Thanks to Google Form, you can set up forms with:
- open questions,
- questions of singular choice,
- linear scales,
- multiple choice grid.
You can easily drag & drop various elements and set up answers as required. After creating a form, you can share it with your customers using a direct link (or send it via email). Tip: you can use one of our Tidio Chatbots to send it automatically after specific actions performed by customers!
Here’s what the example form looks like:
After collecting the data, you can check out the summary of all the answers or take a look at individual surveys.
Or if you’re aiming for more advanced analytics – export the data right to Google Spreadsheet.
4. Choose timing to send survey
Timing is essential.
Depending on your goals, the survey should be sent after a specific point of customer’s interaction with your business. A good idea would be to send it:
- Immediately after an interaction with your customer service: this approach allows you to measure satisfaction over interacting with your customer support. It’s important to capture this feedback right after the interaction, because it’s still fresh. Otherwise, people tend to forget how they felt.
- Some time after customer’s purchase (the timing depends on the nature of your product or service): with this approach, you’ll catch the feelings regarding your product or service after some time of usage. Why should you wait? It’s simple – because customers need some time to fully familiarize themselves with a product or a service. This of course differs from industry to industry, but a good rule of thumb is to give your customer some time.
- At different stages of the customer life cycle: this approach allows you to measure how the customer’s satisfaction changes over the time. The more touch points you’ll examine, the more specific image of customer experience you’ll get.
And remember not to survey your customers too often because it’ll result in low response rates.
5. Analyze the data
No analyzing, no conclusion.
That’s the moment, when you gather the data and make the best out of it. Analyzing helps you discover business’ strengths and weaknesses. Getting that knowledge is the first step to improve the weaker areas.
When analyzing business’ flaws, ask yourself these questions:
- at what customer touchpoint the issues occurred?
- which area of your business is the issue related to?
- what was the direct cause of the customer’s score?
- what are the easiest and most effective solutions you can implement?
After getting the answers, it’s time to…
6. Look for the solutions
The most important thing in the process is to NAME the issue. After doing it, looking for solutions should be much easier.
So how can you fix the bottlenecks?
It’s difficult to provide specific tips – it all relies on industry and which area needs to be improved.
For example, if the issue is related to customer service, you could provide training to your customer service employees, work on shortening response times or implement convenient customer service channels (like live chat).
Back to the general – depending on the nature of the issue, here are some ideas on looking for solutions:
- speak to your customer service or marketing department,
- ask on Facebook Groups associating business owners from your industry,
- Google it – there’s a big chance that thousands of business’ owners already had the same problem,
- run an experiment, test, play with solutions.
There are limitless possibilities when looking for answers. Choose the solutions that’ll suit your industry and business best.
Measuring customer satisfaction is healthy for your business’ income because it tells you how loyal and satisfied your customers are. It also gives you valuable feedback on which areas you should improve.
Keeping customer satisfaction at a high level is important – loyal clients tend to spend more money, not to mention that acquiring new clients is much more expensive than keeping the present ones.
So what are you waiting for? Go out there and make your customers love you!
Let’s grow your business together!