Irrespective of dark times or any other business environment measuring customer satisfaction is a critical avenue for all brands and businesses across the globe.
Nevertheless, it has been seen that the satisfaction of the customers is often overlooked as an aspect of a successful business model in most industries.
This is because most establishments focus too heavily on acquiring new customers and spend too little time or effort on satisfying and retaining the existing ones, which can nonetheless be quite damaging for sustaining business growth.
Now luckily for business owners in the present time, there are several technological tools and customer support software solutions available these days, which makes satisfying customers easier than ever before.
However, to maintain satisfied customers for your business, you need to have a thorough understanding of how you can measure customer satisfaction so that you can remain sure that your customers are truly happy with your products and services.
Therefore, we as one of the most popular vendors of Salesforce Alternative CRM tools have discussed some of the key benefits of managing “customer satisfaction” and have even covered the three most used commonly used metrics for measuring customer satisfaction for any company.
ADVANTAGES OF KEEPING CUSTOMERS HAPPY
Since many have written several times even in the past referring to the best tips which help maintain optimal customer satisfaction levels, let us dig deeper over here and illustrate the benefits of doing so.
It Is Cost-Effective
Are you aware that your existing customers according to research, will most likely spend 67% more than new customers and it is even true that it costs 5 to 19 times more to acquire new customers than to retain the existing ones?
Therefore considering these statistics we suggest that businesses should be spending a decent sum of their marketing budget for funding their customer retention programs, more so during these dark times.
This is because businesses that will focus on customer retention will definitely be those that will come out on the top in the future once this COVID-19 Pandemic is a thing of the past.
Boost Brand Loyalty
It is a known fact that customers who are satisfied will stick around longer and thereby provide businesses with a recurring revenue stream, which can help develop brand loyalty.
According to a research done by Capgemini, it was found that 8 out of 10 consumers are willing to pay more for enhanced customer experience (and a better CX is what satisfies customers and creates loyalty).
Generate Word-Of-Mouth Advertising
It is natural that when customers are satisfied with any brand they are much more likely to recommend their preferred brand to their friends and families.
According to research, it shows that more than 83% of consumers trust product recommendations from their loved ones more than any other type of advertisement.
It has also been often noticed that satisfied customers share their recommendations on social media platforms, discuss the advantages of buying from their preferred brands with friends in informal settings, or even recommend their preferred brands in their workplaces.
Now even though this is free advertising, nevertheless it is also the most effective type of advertising found today in any marketplace across the globe.
Enjoy Market Differentiation
In today’s highly competitive marketplace and business environment, more so during these Pandemic-ridden troubled times, you just cannot afford to neglect to tend to the customers and their demands for finding increased customer satisfaction among the consumers of your offerings.
This is because creating world-class customer satisfaction helps to differentiate your brand from other competition which is the need of the hour, more so during these times when all businesses are witnessing a recession in their markets and an economic slowdown across the globe.
Therefore if your brand fails to maintain a constant focus on customer satisfaction and customer experience, your existing customers can easily leave you for businesses that do provide enhanced satisfaction to their customers in your marketplace.
THREE METRICS FOR MEASURING CUSTOMER SATISFACTION
Not that we know the benefits of upholding world-class customer satisfaction and experience for the consumer of your brand, let us discuss the three primary metrics that can help measure customer satisfaction levels for your business, which can be easily evaluated using a customer support software solution like an easy to use CRM tool.
1. Customer Satisfaction Score (CSAT)
CSAT is used on a scale of one to five and is used for measuring the levels of customer satisfaction with a brand or any of its offerings.
In CSAT customers rate their satisfaction levels as:
- Very unsatisfied
- Somewhat satisfied
- Very satisfied
Now for example, if you want your CSAT survey to consist of 5 questions on several topics, you would take the average of each customer’s response and that will be their individual CSAT score.
After this once enough response has been collected, in the next step you can take up each individual customer’s CSAT scores, add those scores up and thereafter divide the total sum by the total number of the respondents, which will provide you the overall CSAT score for your brand or business.
You can even take the average score of any individual question that you presented in the survey to come up with insights into individual topics since CSAT is an effective way to gauge short-term satisfactions at a granular level.
2. Net Promoter Score (NPS)
Now as we said, the CSAT score is most useful for measuring the short-term satisfaction levels of your consumers, NPS is a metric that is used for measuring long-term customer satisfaction and loyalty towards a brand.
NPS which is considered as one of the most dependable metrics for measuring customer satisfaction relies only on one single question:
“How likely are you to recommend our services or products or our brand to a friend, relative, or colleague?”
Responses in NPS are measured on a scale of 0 to 10, where zero stands for least likely and ten being most likely for any responder answering in the survey.
In NPS we consider them who answers 9 or 10 as “Promoters” or customers who are most likely to stay, buy more, and recommend your brand.
Respondents who answer 7 or 8 are considered “Passive”, which implies that these customers do not have any strong feelings or loyalty attached to the brand.
And respondents those who answer 6 or even lower in the scale are termed “Detractors” which means these people are more likely to leave the brand and can also be potential dissuaders to others willing to buy from your company.
Now instead of calculating an average like what we illustrated in CSAT, in NPS primarily you need to take into account the sum total of the percentage of respondents that are marked ‘Promoters’, and thereafter the sum total of the percentage of respondents that are marked as ‘Detractors’ (ignore the ‘Passives’) and subtract the percentage of the ‘Detractors’ from the ‘Promotors’ and represent the figure not as a percentage but as a whole number.
For example, you are doing an NPS survey of 1000 respondents, where there are 700 Promotors (70%), 200 Passive (20%), and 100 Detractors (10%).
Therefore, to find the NPS you must subtract 10% from 70% (ignoring 20% that are Passive) and come up with 60%, whereby 60 will be your brand’s Net Promotor Score.
Now in NPS unlike CSAT you can even have a negative score if you have more Detractors than Promoters for your brand.
Nevertheless, while an NPS above zero is considered good, any score which is in-between 50 and 70 can be marked as excellent and a score above 70 in NPS can be considered world-class.
3. Customer Effort Score (CES)
Finally, this metric which is also calculated once you use an easy to use CRM software platform for your business growth differs a lot from CSAT or NPS, since it does not directly measure customer satisfaction level as we have seen before.
Rather, it is a metric that measures the amount of effort that customers had to put in into a specific interaction with your brand, and hence CES is an ideal metric to measure the effectiveness of the functions in your company’s customer support.
This is because higher levels of customer satisfaction depend a lot on reducing the efforts a customer must put when interacting with your company.
Hence if your business is capable of solving their problems and issues without putting much of a burden on your customer’s shoulders, it is natural that they will leave satisfied with your brand’s services.
Now CES is measured by asking the customers of your brand to rate in general the extent of efforts they had invested into an interaction with your company, on a 1 to 5 point scale, whereby 1 stands for “very low effort” and 5 is considered “very high effort” on the part of the consumers of your brands’ support services.
Next, while all the responses are in, calculate the average of those that produce the CES.
While a CES of 2 or even lower implies that the company is successful in making the lives of its customers easy, which means that the customers are happy, any score that is over 4 or 5 implies that the company must rethink how it must support the customers with a mind towards considering finding out suitable ways that might take some burden off the shoulders of the consumers of their offerings.
In this world devastated by the COVID-19 Pandemic, maintaining customer satisfaction is more important today than ever before, and so brands now must work harder to keep their consumers satisfied and loyal to their companies.
Hence, focus on these three metrics which are available in most customer support software tools, and find changes in your customer feedback that will help your business continually improve its customer experience and retain more customers in the long haul during and even after this pandemic.