What do your customers REALLY think? Find out with these 4 customer satisfaction indicators
Every company has a duty to devote as much energy as possible to customer satisfaction. And for good reason: happy customers are customers who come back, or even become true ambassadors for your brand.
But to identify the levers you need to activate to achieve this, you need to know where you stand. You may have the impression that your customers are very happy with you, but the reality is quite different.
That's why we recommend that you set up and regularly monitor customer satisfaction indicators.
But between CSAT, NPS and CES, which indicators should you choose to measure customer satisfaction ? This article reviews the four main ones.
What are customer satisfaction indicators used for?
Customer satisfaction is a major objective for any commercial enterprise, because if your customers are delighted :
- they are more likely to use your services again when the need arises (remember, it costs less to retain an existing customer than to acquire a new one!
- they are less likely to turn to the competition;
- they will recommend you to their friends and family.
And all this is good for your sales and for the future of your business 💵!
But to find out what your customers really think, it's out of the question to take a 'guessing game'. On the contrary, it's important to precisely define your room for improvement. Hence the importance of determining how to measure satisfaction using reliable indicators.
Focus now on 4 of them:
- CSAT(Customer Satisfaction Score),
- NPS(Net Promoter Score),
- CES(Customer Effort Score),
- the re-purchase rate.
☝️Le calculating most of these indicators involves collecting data beforehand, and therefore distributing questionnaires to your customers.
CSAT, or Customer Satisfaction Score
What is CSAT?
The CSAT, or Customer Satisfaction Score, is the most basic indicator. It consists of answering a simple question such as:
"How satisfied are you with our product/service?
To express their opinion, customers are asked to select their answer from a multiple choice:
- very satisfied
- fairly satisfied
- not very satisfied
- not at all satisfied.
The benefits of CSAT
CSAT is very popular with companies, because it measures a number of parameters, such as the quality of products and services, of course, but also customer support, ease of use, value for money... in short, anything you like.
What's more, it's an accessible indicator, based on an easy-to-understand question, which encourages customers to respond.
How do you calculate the Customer Satisfaction Score?
The Customer Satisfaction Score formula is as follows:
| CSAT = Number of positive responses/Total number of responses x 100 |
👉 For example, if in your campaign, out of the 1000 respondents to your questionnaire, 200 say they are very satisfied and 500 say they are satisfied, your result is 70.
| 700/1000 x 100 = 70 |
So what is the average customer satisfaction rate to aim for? As a general rule, if you score over 80%, that's a very good sign. Conversely, a score of less than 50% doesn't bode well.
💡 Tip: customer satisfaction research can be made much easier by the use of technology. CRM software such as Salesforce Starter comes to mind. Salesforce Starter is unique in that it follows the customer from the prospecting phase right through to customer service, and centralises all the associated data within a single interface. It's a handy way of assessing customer satisfaction and looking at how it develops over time!
NPS, or Net Promoter Score
What is NPS?
The NPS, or Net Promoter Score, is another example of a customer satisfaction KPI. Here, the question to ask is:
"On a scale of 1 to 10, how likely would you be to recommend our brand to your friends and family?"
The respondents are then divided as follows:
- from 10 to 9: ambassadors, very happy with the company and willing to actively contribute to its reputation;
- from 8 to 7: the passives, who are much more neutral and would not systematically recommend you;
- 0 to 6: detractors, who are likely to make negative comments about you.
The benefits of NPS
By measuring the propensity of customers to recommend a company or not, the Net Promoter Score makes it possible to anticipate their loyalty and commitment. Far more so than CSAT, in any case...
At the same time, by clearly identifying your detractors, you can concentrate on resolving the problems that are causing their dissatisfaction.
How do you calculate the Net Promoter Score?
When calculating your Net Promoter Score, focus on your ambassadors and detractors, i.e. the profiles that have a real impact on your brand.
Here's the formula to apply:
| NPS = % of promoters - % of detractors |
👉 For example, if out of 1000 respondents you count 600 ambassadors and 200 detractors, your NPS is 40.
| 60 - 20 = 40 |
The higher your score, the more promoters you have than detractors. However, an average NPS of between 0 and 50 indicates a certain margin for improvement.
☝️ Be careful, always relate this result to your field and compare it with the average to assess yourself. Some sectors, such as banking, are generally worse off when it comes to customer satisfaction.
The CES, or Customer Effort Score
What is the CES?
This fairly recent indicator reflects the effort made by the consumer to obtain satisfaction in various areas: the purchasing experience, customer service, etc. It is therefore a measure of customer satisfaction.
It is therefore a highly relevant metric, since it is not just used to judge whether a particular product or service meets the consumer's expectations: it assesses the consumer's experience and relationship with your brand more generally.
Once again, you need to start by asking the consumer a question like this:
"On a scale of 1 to 5, how would you rate the effort involved in contacting customer service?"
The benefits of CES
First of all, the CES focuses on the effort made by customers to achieve their objectives. It can therefore be used to target obstacles directly, with the aim of improving the situation.
In addition, this indicator helps to evaluate certain interactions (with the support department, for example) and provides precise information about the consumer's experience at a given moment.
How is the Customer Effort Score calculated?
The formula for calculating the Customer Effort Score is as follows:
| CES = Total responses/Number of respondents |
In short, you have to take the average of all the responses obtained.
👉 For example, if you sent the survey to 100 people and the total score obtained is 580, your ESC is 5.8.
| 580/100 = 5,8 |
As a general rule, a Customer Effort Score above 5 is considered to be a very positive result.
The re-purchase rate
What is the re-purchase rate?
Also known as the customer retention rate, this indicator differs from the previous three in that it is not based on responses obtained via a questionnaire.
More precisely, this KPI evaluates the frequency with which your customers return to make an additional purchase over a given period. As you can see, it is used to understand customer loyalty.
The benefits of the re-purchase rate
Unlike other indicators, the re-purchase rate directly measures the level of active customer loyalty. When a customer decides to buy from you again, they are demonstrating their trust in you.
This is concrete behaviour, which goes beyond intentions (as with NPS) or one-off perceptions (as with CSAT).
How do you calculate the repurchase rate?
Before starting the calculation, choose the period for which you want to obtain the result, for example a month, a quarter or a year.
Then apply the following formula:
| Repurchase rate = (Number of customers making an additional purchase/Total number of customers) x 100 |
👉 For example, if 300 of your 500 customers made an additional purchase during the period, your re-purchase rate would be 60%.
| Repurchase rate = (300/500) x 100 = 60%. |
A good re-purchase rate varies from one industry or sector of activity to another. But when it is above 20-30%, the result is considered very encouraging.
What can we learn from customer satisfaction indicators?
Every company needs to put in place and monitor customer satisfaction indicators, which are the best way of finding out what customers really think of you. Without these KPIs, it is impossible to implement the necessary corrective measures.
So there's no need to dwell on dozens and dozens of metrics. Monitoring three or four indicators will suffice, including CSAT, NPS, CES and the re-purchase rate.
Of course, you should keep a regular check on these KPIs and their progress over time: that way, you'll understand whether your efforts are bearing fruit (or not) and whether you need to keep heading in the same direction.
Article translated from French