Topic(s): Customer Centricity Metrics & Methodology Customer Experience

Customer Satisfaction Score (CSAT): everything you need to know

Table of content

What is CSAT and how do you measure it?

CSAT stands for Customer Satisfaction Score and is a key metric being used to calculate customer satisfaction after certain transactional interactions with a company. A transactional interaction is a specific interaction with a customer, like the purchase of a product or a service-related interaction.

CSAT is measured using surveys, a transactional survey in this case, mostly with a scale from 1 to 5 or 1 to 7. 1 being very unsatisfied and 5 or 7, depending on the range, being very satisfied. We strongly recommend combining your survey with an open feedback field, so you can identify the reason behind the score.

CSAT - Customer Satisfaction Score

CSAT surveys can give you a lot of business insights, including:

  • how happy customers are with a specific topic of process of your business so you can pinpoint issues
  • how to improve customer relations
  • how to optimize or streamline certain business processes 
  • which products or services you should develop next

CSAT allows you to predict customer loyalty and identify friction points in your customer journey. The CSAT metric can be used alongside Net Promoter Score (NPS) and Customer Effort Score (CES) - as part of your Voice of the Customer program. 

The CSAT calculation formula

You can calculate your overall CSAT score by dividing the total number of positive responses by the total number of received responses, then multiplying it by 100.

As a result, you'll get the overall percentage of satisfied clients.

So what is a good CSAT score?

 CSAT results can vary from one sector to another, but a good score is often between 75% and 85%. A 75% score means that 3 out of every 4 customers gave you positive feedback rather than a negative or neutral one. 

When should you send out customer satisfaction surveys?

The best setup to measure customer satisfaction will be different for every company, depending on the importance of the interactions and KPI's. Here are 3 examples of interactions that provide valuable insights for a lot of our customers:

  • Following an interaction with customer support

You can send out CSAT surveys prior to customer support, or customer education touchpoints. Asking people how satisfied they are with your service after reading a knowledge base article or talking with one of your customer support representatives can help you know how helpful they were.

  • At the end of the checkout process

You can ask your clients about how satisfied they are with their experience at the end of the checkout process. At this point, the opinion they have formed about your brand is still fresh in their heads. And, they are more than willing to inform you whether or not your company delivered a pleasant shopping experience.

  • Before renewal

Send a survey every quarter or so to see if your users are satisfied. This allows you to have an overview of their experience through time. You can also ask your service subscribers a few months before their renewal date if they are pleased with it. This gives you enough time to address any concerns that arise before it's too late.

 

Measuring customer satisfaction: why is it so important?

Measuring customer satisfaction is a critical aspect of long-term business success. You need to be providing your clients with a top-notch experience since 33% of customers would consider changing the company they are doing business with due to unsatisfactory customer service.

Let’s just say that you might be able to acquire new clients quickly, but if they don't stay around long enough, chances are your business will be stuck in a rut that you won't be able to get out of. This is why keeping track of your customer satisfaction is very important. If you’re not actively trying to understand and fix whatever it is that is making your customers dissatisfied, they will stop doing business with you and will either complain to their friends, family, or on social media. Not only will you be left with one less client but your company could also suffer from negative word-of-mouth.

Besides being a great metric to track the performance of your support team over time, each negative CSAT survey response can help you find out what went wrong and gain insights into where the product or service is not meeting the customer's expectations.

  • Get a sense of how people feel about your brand.

CSAT is an excellent approach that gives you a basic idea of how customers feel about your company. If most of your responses are 4s or 5s on a 1-5 scale, there's a strong likelihood that people like your brand which can help you acquire good word-of-mouth. On the other hand, if most of your clients’ responses are 1, 2, or 3s, you're probably not up to their standards.

If you include an open text box at the end of each survey, where you ask your customers to explain the reasons behind their scores, you'll gain a lot of relevant insights that you can use to adjust your strategy and improve the experience that you are offering them.

CSAT - open feedback - why this score?

 

  • Reduce the number of customers who leave.

It might be difficult to figure out which one of your customers is unhappy and why they are dissatisfied when you have hundreds, thousands, or millions of clients.

Identifying disgruntled customers, reaching out to them, and making things right before they abandon you is the greatest method to reduce churn. CSAT surveys can help you identify them and make the necessary changes to make them stay. Reading thousands or millions of feedback is not feasible, but a platform like Hello Customer can help you go through and analyze thousands of feedback in seconds. We sort out urgent feedback that needs your immediate attention and give you the chance to act right away using our conversation manager.

  • Employee churn is lower

Providing a satisfactory experience not only can help you reduce the rate of customer churn, but it can also help you retain your employees.

Your customer success staff will receive fewer questions and complaints if customer satisfaction levels are high. A customer support representative can receive numerous unpleasant calls every day. They can manage them effectively, but if they have to go to great lengths to keep your clients pleased, then you need to check your CX strategy. Your employees can only keep going as valiantly as they can for a certain period of time. But if there are a lot of ongoing complaints, they will most likely burn out. Receiving positive feedback from customers, on the other hand, can lift your employees’ spirits and motivate them to provide an even better service.

CSAT compared to other metrics: NPS and CES

While CSAT and CES are mainly transactional surveys, NPS is a relational survey.

  • Net Promoter Score (NPS)

The Net Promoter Score is a good fit for relational surveys since it measures a customer's loyalty with just one question. Rather than asking how satisfied customers are, NPS asks, "On a scale of 0 to 10, how likely are you to recommend us to a friend or colleague?"

The concept is that a happy customer who is willing to recommend your company/product/service is loyal.

NPS example
  • Customer Effort Score

CES does not provide a holistic view of the company but reveals key information for process improvements. This may be accomplished by tying the CES survey to specific touchpoints and incorporating the results into continuous improvements in your strategies.

Here are some excellent Customer Effort Score Question-Wording examples to get you started:

  • The company's service made it easy for me to make the purchase.
  • The company's website makes shopping easy for me.
  • This customer support chat assisted me in quickly resolving my problem.
  • I found it simple to make a complaint on the company's website.

The real challenge: improving your customer satisfaction (score)

In most industries, customer satisfaction and customer service performance are measured through CSAT surveys. But numbers and percentages are not enough to get the best out of your CSAT score. You need to include open-ended questions to better understand what is driving or harming customer satisfaction.

Including an open-ended text field at the end of each CSAT survey helps to identify the reasons behind the score, providing actionable customer insights. 

You will improve your CSAT score by taking action and solving identified customer friction.

With Hello Customer, you can automatically extract customer insights from open feedback at scale with powerful AI-powered Text Analytics so you don’t have to manually go through thousands of survey responses. All of your feedback is automatically sorted into categories and subcategories, while the sentiment analysis gives you insight into what is positive, neutral or negative. 

This way, you can get a birds-eye view of what needs your attention first to increase your customers' satisfaction.

Conclusion

The Customer Satisfaction Score is an excellent metric to measure satisfaction at specific touchpoints. CSAT surveys allow for a better understanding of how different aspects of your business are performing.

A CSAT survey allows you to understand things like customer sentiment, your churn risk, and how well you rank against your competitors. You can integrate it with other customer satisfaction metrics like Net Promoter Score and Customer Effort Score, in order to fully comprehend your customer experience program's current situation.

Keep in mind that a CSAT question on its own will only give you your score and not the reasons behind it. You need to add open text questions if you want to discover how to implement a successful CX strategy.