How to use Customer Satisfaction as a KPI

Letizia Zappa
By Letizia Zappa

The best way to understand whether your customers are happy with you or not is by asking them directly in a survey. However, you should be aware that customer satisfaction surveys can result in large amounts of data. To give valuable meaning to this data, Key Performance Indicators are very useful.

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What gets measured, gets managed

Peter Drucker
American management guru
In business, it goes without saying that you continuously need to measure your performance. This, of course, applies to your customer satisfaction too. As described in our previous blog post, surveys are one the most common and effective tools to measure your customer satisfaction. However, from the very beginning when setting up customer satisfaction surveys, it is important to be aware of what kind of measurement the feedback collected represents for it to be useful.

Quantify your customer satisfaction with KPIs

Key Performance Indicators (KPIs) are quantifiable types of performance metrics that a company adopts to determine to which extent its present operational and strategic goals are reached. KPIs are objective, easy to track and can be investigated through customer satisfaction surveys. Below, we have listed some of the most meaningful KPIs related to customer satisfaction. These will guide you in formulating your questions and at the same time be extremely helpful in interpreting the answers collected.

NPS®

Net Promoter Score (NPS) is probably the most used customer satisfaction KPI, which focuses on measuring the score of your customers’ satisfaction and loyalty. This score is based on one simple question:

“How likely is it that you would recommend this brand/website/ product to a friend or colleague, where 0 is not likely and 10 is very likely?”

Based on the answers given, your customers are divided into three different categories:

  • Promoters
  • Passives
  • Detractors

The score is determined by subtracting the percentage of Detractors from those who are Promoters. If your survey results show that you have more Promoters than Detractors your NPS score will be positive.

NPS_Customer_Satisfaction

 

If you want to know more about NPS, this guide will give you super precious insights.

CSAT

Customer Satisfaction Score (CSAT) is another score to test your customer satisfaction. However, this score specifically investigates your customers’ satisfaction with your product/service/interface. The typical CSAT question goes as follows:

“How would you rate your satisfaction with the product/service/interface you just experienced?”

CES

Customer Effort Score (CES) measures how much effort your customer has to put into the interactions with your company. The smoother the interactions are, the more satisfied the customer is going to be. The CES has the ultimate goal of helping you discover what and how many difficulties your customers encounter. Elements such as time and the number of interactions needed to complete an operation or find an information are all perceived as efforts. So, how can you measure CES? By asking a simple question similar to:

“How easy was it to deal with this part of the website/product?”

Use KPIs for benchmarking

The importance of KPIs is defined by their inherent utility. Without objective benchmarks, it is very difficult to understand how your business is doing and where it is heading. KPIs represent a great tool to compare your current results with:

  • Your own past metrics and scores
  • The global standard of the industry
  • Your direct competitors

With the right use of KPIs, you will thus be able to quantify and frame your customer satisfaction insights into valid metrics making it much easier to take important decisions on how to manage your business.

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Want to know more about KPIs and their role in customer satisfaction surveys? Get your hands on our ultimate guide to customer satisfaction! Download our white paper “Customer Satisfaction: Everything you need to know about Customer Satisfaction to grow your business” and get well started measuring your own customer satisfaction.

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