How To Measure Customer Experience

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There has been a ton of research about the value of delivering exceptional customer experiences (CX). Allocating budget and resources towards customer excellence is no longer a “nice to do” but rather a “have to do” to win in a competitive marketplace. Considering the statistics below, it is clear that measuring customer experience is just as important as tracking revenue, costs, and related Key Performance Indicators. There are many ways of gathering Voice of Customer (VOC) feedback to obtain quantitative and qualitative insights. One prevalent method is through deploying surveys that include the Net Promoter question, commonly referred to as NPS.

The Value of Net Promoters (NPS)
Source: ZenDesk

What is NPS? Why Does It Matter?

In simplest terms, it is a single question asked of customers: “How Likely Would You Recommend (insert company name) To Your Friend or Business Colleague.” The answer provides an indication of how customers view a brand and is based on a mathematical approach. The following is an informative short video that explains the history of NPS, the NPS equation and the meaning behind the score.

To summarize:

Promoters (9-10 scorers):
• Are willing to refer friends and business colleagues
• Typically loyal customers and unlikely to leave for a better offer because they are highly satisfied.

Passives: (7-8 scorers)
• Are indifferent about a brand
• Do not have strong feelings in favor of or against a company
• Do not spend much time promoting to friends or business colleagues

Detractors: (0-6 scorers)
• Highest probability of leaving the company for a competitor’s product or service
• Actively discourages others from using the brand, which can have huge revenue impacts.

Bad Customer Experience Can Have Big Revenue Impacts For Companies
Source: ZenDesk

Getting customer feedback and scoring their experience at EVERY TOUCHPOINT is a key step to becoming more customer-centric however, it is wasted effort if employees do not take action from the insights gathered. The following are best practices in DoingCXRight:

1. Ask the NPS question at “moments of truth” throughout the customer journey. (learn more about journeys and get free template here)

2. Communicate results throughout the organization at all levels, so everyone understands the scores and helps “close the loop.” Frontline employees must follow up with Detractors to resolve their “pain points,” and timing matters! The quicker customers are contacted, the more likely they may be converted from a detractor to a passive or promoter. Keep in mind: “It takes 12 positive experiences to make up for one unresolved negative experience” (source: Ruby Newell-Legner).

3. Institute programs that engage Promoters as they are most likely to be brand ambassadors. i.e. Deploy a referral campaign targeting customers who gave a 9 or 10 rating, and provide benefits to recognize their loyalty.

4. Pay attention to Passive customers. Do not ignore them. Communicate often and care about their needs just as much as promoters and detractors, as they can easily convert to a customer who brags about the company or leaves for a competitive offer.

5. Make customer experience metrics part of everyone’s personal accomplishments. It’s a sure way to engage employees, keep them accountable and build a “customer-first” culture. Considering a “5% reduction in the customer defection rate can increase profits by 5 – 95%” (source: Bain & Company), everyone needs to own customer experience and continuously use CX scores to drive improvements.

In summary, Net Promoter Score (NPS) is a useful metric in gauging customer perceptions and identifying if overall expectations are met. However, NPS is not the only score that matters. There are drivers of NPS such as C-Sat (Customer Satisfaction), Level of Effort and other measurements that need to be leveraged as well. I will share more details about CX scores in upcoming articles including ideal ways to implement a comprehensive Voice of Customer (VOC) strategy to achieve company goals.

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