When it comes to growing your organisation, you simply can't afford to get customer experience (CX) wrong. Better CX means higher customer satisfaction and, therefore, healthier growth. But how do you actually measure something as intangible as customer satisfaction or CX?
Why Worry About CX?
While price and product have traditionally been the key to winning consumers over, a recent study by Forrester showed that over two-thirds of businesses (72%) now prioritise customer experience in their attempts to control the corporate battleground.
We see many organisations fully embrace this strategy and start making changes left, right and centre – a new customer service channel here, extra support staff there, operations overhauls everywhere!
Of course, you know what they say about the kind of people who rush into things.
Changing your operations without understanding your customer journey means you’re just as likely to make things worse as you are to improve the situation. And even if you do hit customer experience gold, you’ll struggle to recognise why.
Instead, to increase your chances of becoming a CX success story, you should first get to grips with how you're currently performing. Once you’ve identified what customers love about doing business with you and what they wish you’d improve, you’re empowered to make smarter decisions – based on insights backed by actual data.
And it definitely helps when you know how to measure customer experience.
The CX Metrics Every Business Needs to Know About
Customer Churn Rate (CCR)
Looking at CCR is one of the simplest ways to measure CX and can be measure by calculating the percentage of your customers who decide they no longer want to do business with you – either by cancelling a subscription or not making an expected repeat purchase.
Obviously, you’re aiming for the lowest number possible because that means fewer customers are jumping ship.
Churn has been used for decades to measure CX, and it can give you a general idea of how you’re performing – assuming the more customers you retain, the better your CX is. And, if you focus on particular periods of time, it’s even possible to see the effects of changes you make.
However, there are good reasons that many organisations think CCR is past its prime, not least because it makes big assumptions about consumer behaviour. It’s also not a suitable metric for any business looking for in-depth analysis and reveals little about the specifics of what you do well and what you need to improve.
Net Promoter Score (NPS)
Another widely used method for measuring CX is NPS, which typically relies on customer surveys that ask how likely (on a scale of 1-10) a customer would be to recommend your company to their family, friends, or colleagues. Once surveys are complete, customers are segmented into three categories – Promoters (9-10), Passives (7-8), and Detractors (0-6).
NPS is then calculated by subtracting the number of Detractors from the number of Promoters.
While it captures a general idea of how your organisation is performing based on the assumption that better CX results in a higher NPS, it fails to deliver actionable insight. It may indicate a need for change, but it doesn’t identify what your problem areas actually are.
First Response Time (FRT)
At a time when consumers have almost unlimited options, it's not surprising that 45% of adults will abandon an online purchase if they can't find a quick answer to a question – evidence that providing timely customer support is a vital element of CX.
FRT measures how quickly your staff can provide customer support and is measured by calculating the average time it takes for customers to receive a response after contacting you. Quick response times are generally linked to high customer satisfaction and good CX, but there are different expectations depending on which channel is being used.
Again, FRT can be a useful measurement (especially when identifying gaps in your customer service), but only illuminates a single aspect of your CX. And it's another metric that many believe is on borrowed time, thanks to the proliferation of AI chatbots which can respond almost instantaneously and even accurately answer many queries.
Average Handling Time (AHT)
For some organisations a better measurement of CX is how long it takes for customer service agents to actually resolve issues.
This is a great metric for discovering how effective your team is but, again, doesn’t provide any insight into any other elements of CX. What it can do though, is reveal why customers are contacting your support staff, and this information can be used to fill in any gaps on your website.
Knowing how important a customer’s first interaction with your support team is, you might want to focus on measuring how many queries your agents are able to solve with their first response. Reducing the effort it takes for customers to receive a solution to their problem is a great way to improve CX, and it can also identify if customers are being connected with the appropriate member of your support staff.
Customer Satisfaction Score (CSAT)
Even if your organisation doesn’t measure CX yet, you’ll undoubtedly be familiar with CSAT surveys, because they’re such a commonly used way for brands to measure how satisfied customers are with specific products, services or interactions.
Another metric reliant on surveys, CSAT asks customers to rate their satisfaction with specific products, services or interactions, on a scale of 1-5 (or sometimes 1-7). You then calculate the average score for each touchpoint in the customer journey.
Generally, good CX is indicated by an average score of over 70 or at least 70% of respondents selecting “somewhat satisfied” or “very satisfied”.
CSAT helps you identify how customers feel about individual touchpoints on the customer journey and will enable you to identify areas you need to improve, or measuring the impact of any changes you do make. It’s also an opportunity to collect more in-depth feedback by asking customers to expand on particularly good or bad experiences.
Obviously, CSAT scores won’t measure wider relationships with your brand, but they work perfectly in tandem with other metrics to paint a much clearer picture of your CX.
Customer Effort Score (CES)
A relative (yet increasingly popular) noob in the world of CX metrics, CES measures how easy it is for customers to achieve what they want from an interaction with your business, and was developed during five years of research by the Corporate Executive Board (CEB).
Although identical to CSAT in execution (a customer survey asking customers to rate individual interactions or transaction), CES is a very different metric – making the assumption that consumers prefer easily available solutions over solutions that “delight” them.
Although we might have to disagree that delighting your customers shouldn’t be a key focus for your business, there’s certainly something to be said for simplifying your CX. Removing obstacles from your customer journey and streamlining the customer experience will likely prove to be rewarding. “Make it easier” is also a far clearer CX strategy than “exceed customer expectations”.
The Importance of Customer Journey Mapping
Although we’ve covered customer journey mapping (CJM) at length, we can’t overstate how vital a tool it is to any efforts a company makes to improve CX. In short, customer journey mapping is the process of mapping out every touchpoint between customer and brand, from their point of view.
When we say every touchpoint, we literally mean every single possible interaction a customer has with your organisation – from first seeing you in search results or stumbling upon your website, to your after-sales strategy.
If you haven’t already done it, customer journey mapping should be the first step in your strategy because each touchpoint is an opportunity to improve CX and each gap is a hole for potential customers to fall into – often leaving you no hope of pulling them out.
In short, CJM is simply a vital tool for understanding how to better provide the seamless experience and fully-connected omni-channel customer journey that customers expect.
Go Your Own Way
Ultimately, how you measure CX will depend on who your customers are, how you currently operate and what you’re hoping to achieve. Although we’ve identified a number of common CX metrics, there are more and any of them can be modified to better meet your needs.
Much like NPS inspired CES, you might decide you’d rather measure how you fared against customer expectations. All you’d need to do was tweak the customer survey to ask how much better a specific experience was in comparison to what they had expected.
Every organisation who hopes to improve CX doesn't just need to know how to measure it, they also need to understand what good CX looks like. Although, ultimately, what your customers prefer is going to be subjective, there are some assumptions that are based in research and safe to make – for example, consumers wanting a simpler experience.
If you want to find out more about what great CX looks like, simply click here and check out our new infographic.