5 Customer Experience Metrics to Start Measuring Now
Customer experience (CX) can generally be defined as the sum of cognitive, affective, sensory, and behavioral responses of consumers during each stage of the buying process including pre-purchase, consumption, and post-purchase stages.
Complex, to say the least.
Customer experience metrics help gauge the average opinion of how positive or negative it is to engage with your company’s products, services, and people. Because CX is an intricate intertwining of thoughts, emotions, behaviors, and ultimately expectations of the individual, there’s no single metric or foolproof method of measuring it. But by tracking the number of customer satisfaction metrics you can gather an overall understanding of where your customer experience sits.
Here are the five customer experience metrics your business should start measuring now to understand the average perception of your buyer experience:
- Customer Loyalty Score
- Customer Satisfaction Score
- Customer Effort Score
- Customer Lifetime Value
- Customer Churn Rate
1. Customer loyalty score
Customer loyalty is a measurement of how likely a customer is to recommend your company to their friends and family on a scale of 0-10. Simple and relatively accurate, this question helps identify three categories of customers:
- Detractors (0-6): These customers are least happy, thus least likely to recommend your business to others. In fact, they may actively discourage others from purchasing from or working with your business.
- Passives (7-8): These customers are generally satisfied with their experience, but not enthusiastic enough to actively promote their experience or your business to others.
- Promoters (9-10): These are your enthusiastic supporters – your most loyal customers who are happy and willing to tell other people about their experience through either unprompted referrals or at your request.
By subtracting the number of detractors from promoters you’ll get your customer loyalty score – a big picture indicator of customer satisfaction and customer experience.
2. Customer satisfaction score
Customer satisfaction (CSAT) is similar to customer loyalty but specifically measures how satisfied a customer is with your products and services, rather than their overall experience with your company. CSAT is usually measured on a scale of 1 (very unsatisfied) to 5 (very satisfied) and used to calculate a percentage score with 100% being complete customer satisfaction.
Because CSAT is often measured directly after an interaction with your product or service, such as a customer service call or after a design meeting, it gathers the immediate reaction of a customer’s experience during that moment in their buying journey.
3. Customer effort score
Customer effort score (CES) measures how easy it was for a customer to interact with your company at any given time. Gathering CES is as simple as asking customers: “How easy was it to deal with our business today?” and providing a range of options from easy to difficult. To calculate the score simply subtract all “difficult” responses from the “easy” responses.
CES is a great metric for understanding the obstacles your customers face on their buying journey with your business, so you can reduce their efforts, speed up resolutions, and make their experience with you as convenient and simple as possible. For “difficult” answers, you may want to add an additional question to identify why the interaction wasn’t easy to collect more insight and make changes to your processes and procedures.
4. Customer lifetime value
Customer lifetime value (CLV) is the total monetary value a customer brings to your business over their entire relationship, taking into account customer acquisition and retention costs. CLV encourages the focus on longer-term customer relationships and referral rates. Even homebuying culture today has shifted from building a single home and living it in for a lifetime to moving and building more than once.
CLV helps you measure the durability of your customer relationships, the average spend and typical frequency of purchases, and how the customer journey evolves over time. It also has a direct correlation to customer experience because the more positive experiences customers have with your business, the better your CLV. A diminishing lifetime value can indicate a problem with your customer loyalty and satisfaction.
5. Customer churn rate
Customer churn rate measures how often a customer abandons your product, service, or business entirely. Churn rate is calculated by dividing lost customers by the total number of customers in a given timeframe. Churn rate can also be calculated by revenue lost during a specific period.
A high churn rate tells you that your customer experience is lacking and you’re not developing customer loyalty. Understanding why your customers churn and what touchpoint in the buying journey they’re at risk allows you to adjust your operations to improve their experience before they’re gone for good.
Your customer experience measurement needs all in one place, with AvidCX.
By: Avid Insights Team
