6 Ways To Measure Customer Experience

The article 6 Ways To Measure Customer Experience is a guest blog post done by Bash Sarmiento. If you wish to learn more about Bash, check out the author’s bio at the end of the article.

If you want to scale a business, increase revenue, and beat the competition, focus on Customer Experience.

Customer Experience (CX) is any experience related to a business that impacts how the customer perceives and feels about the product/service the business is offering. It can also refer to the total interactions of the customers with the brand or company. Many experts believe that the goal of any business is to offer an excellent customer experience.

It is no longer enough to just have a high-quality product or service in today’s business environment. Business leaders expect customer experience to surpass product quality and pricing as the main brand differentiator. 

When you look back at your own customer experiences, you will most likely realize that you became a repeat customer of a product/service because of a satisfying customer experience. Similarly, you may have opted out of a product after a poor direct interaction with the company offering it. 

You are not alone

This consumer behavior has become quite common in recent times. Results of the 2018 PwC Consumer Intelligence Survey indicate that 73% of people agree that customer experience is an important factor in deciding to purchase or not. The survey also reveals that 43% of consumers are willing to pay more in exchange for convenience, while 42% said that they won’t mind spending more to get a friendly and welcoming experience.

According to the 2021 Customer Experience Benchmarking Report, 90.9% of organizations agree that Customer Experience is the main business differentiator. In addition, 57.9% of global consumers strongly believe that Customer Experience is a way for businesses to get ahead of their competitors. 

Now that we have established the importance of CX, how do we optimize it? 

The straightforward answer is to measure it. Although CX is more qualitative in nature, there are existing metrics that can produce valid results for measuring customer experience. 

Here are the top 5 metrics that you can use to measure Customer Experience. 

Customer Satisfaction 

This is arguably the most common metric for Customer Experience. To measure customer satisfaction, companies often use CSAT (Customer Satisfaction Score). To determine this score, companies give out a survey that asks customers to rank their satisfaction level from 0 – 5 ( 0 – unsatisfied, 5 – highly satisfied). The CSAT is the average score of this survey. CSAT survey is typically provided after a customer has made an order or interacted with the customer service team. 

While direct CSAT surveys are easy to offer, their results will not fully identify problematic areas in your entire customer experience. Customers will give a rating but will not likely give a more in-depth explanation or insight into their experience. 

This is why you need to also measure CX using other methods. Consider more implicit customer feedback and metrics like mystery shopper reviews, or online product review ratings to get a good grasp of how satisfied your customers are. 

Customer Loyalty

A great CX can bring about strong customer loyalty. Thus, the current level of your customer loyalty is a strong indicator of whether you’re treating your customers well or not. According to the PWC study, One in three consumers (32%) will give up a brand they love after just one bad experience. 

To measure customer loyalty, you need to record and track the data on the following:

• Repeat Orders – How many customers are coming back and what products are they purchasing?
• Frequency of Order – How often are they returning to purchase more products? 
• Average Order Quantity – Is the number of products increasing every time repeat customers are coming back?
• Loyalty Program Behavior – How many of the participants are using the discounts a few times, and how many of them are in there for a long time?  

Net Promoter Score 

Net Promoter Score or NPS measures how likely your existing customers will recommend your business to other people. NPS also measures the percentage of customers that adore your product/service or are just neutral about it. 

The NPS method involves creating and giving out a survey that asks customers how likely they are going to recommend your business to a friend. The survey uses a scale system of 0-10.  

The consumer behavior interpretation of the scale is as follows:

0- 6 unwilling to promote/detractors

7-8 neutral customers

9-10 – most likely to promote

By subtracting the percentage of detractors from the percentage of promoters, you will come up with your NPS. The score will indicate how happy your customers are with their relationship and experience with you. 

You can track NPS over a certain period (e.g. monthly or quarterly) and then use the data to improve customer experience to convert passive or detractor customers to promoters.  

Customer Interaction with Employees

Even in this increasingly digital-dominated world, customers value human interaction during their purchasing journey. PWC reports that 82% of U.S. and 74% of non-U.S. consumers value human interaction. 

How well your customer service or frontline employees deal with customers affects the overall customer experience. This metric aims to find out:

• Are your employees representing your company well?
• Do they understand the value of customer experience?
• Do they know exactly how to offer a quality customer experience?
• Are you providing regular training and feedback systems to maintain CX standards?

Employee Experience

Engaged experience directly impacts the customer experience. Satisfied and engaged employees will most likely make customers happy. According to Gallup’s study on employee engagement, engaged employees tend to be more committed to offering quality service to customers. Businesses with highly engaged employees saw a 20% increase in sales and a 10% increase in customer ratings.

Operations 

Companies often disregard this metric, but it is directly related to Customer Experience. This metric focuses on questions like:

• Average wait time for customers in the contact center
• Percentage of late deliveries  
• Support ticket trends. How long does it take to address issues raised by customers? What are the common problems or issues customers are raising?

Conclusion

One metric isn’t necessarily more important than the other. Experts encourage taking a more holistic approach to measuring Customer Experience by consolidating the data taken from various metrics. You can develop a customer health score – an index composed of key performance indicators or metrics, to give you a general idea of the present status of your customer experience. 

Furthermore, you may use the data from the discussed CX metrics for specific applications like justifying improvements or investments in certain departments, launching remedial interventions, and establishing goals for higher CX standards.

Ultimately, customer experience creates a long-lasting perception of a brand. When done correctly, it results in customer brand loyalty. 

Author’s Bio

Bash Sarmiento is a writer and an educator from Manila. He writes laconic pieces in the education, marketing, lifestyle and health realms. His academic background and extensive experience in teaching, textbook evaluation, business management and traveling are translated in his works.

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