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Topic(s): Metrics & Methodologie

Measure customer satisfaction with these 3 KPIs

It probably won’t surprise you, but satisfied customers are more likely to return. Therefore, regularly investing in customer satisfaction surveys is definitely worthwhile. Figuring out whether your customers are currently satisfied, as well as understanding if they will stay satisfied in the future, is priceless. Not only that, understanding why this is the case is just as important. To that end, there are several ways to do so.

This blog post will answer the following questions you may have:

  • Why measure customer satisfaction?
  • How do you measure customer satisfaction – tailored specifically to your company?
  • How do you measure customer satisfaction with surveys?
  • Which 3 KPIs are best to measure customer satisfaction?

Why measure customer satisfaction?

Customer satisfaction can have a double effect, either positive or negative. It influences the customer’s behavior towards you. After all, a satisfied customer will be more likely to buy from you again compared to an unsatisfied one.

It will also influence how customers talk to others about your company. Very unsatisfied customers are likely to share their experience with others via word-of-mouth or social media. Something you want to avoid at all costs. Oppositely, a very satisfied customer is worth (at least) two when it comes down to recurring purchases and promoting your company. 

The more your business model depends on customer loyalty, retention and lifetime value, the more crucial for your business measuring customer satisfaction is. 

How do you measure customer satisfaction tailored to your company?

In essence, measuring customer satisfaction is fairly straightforward:

  • Ask your customers for feedback: via e-mail, in-app, via your website, ... using survey or customer feedback tools.
  • Make sure customers have the possibility to give spontaneous feedback, i.e. reviews or ratings. You can even gather feedback via QR codes, something our client Colmar has implemented in their restaurant menus.

The ideal solution for your company depends strongly on a number of factors. We’ll shed some light on 2 crucial ones:


The scale of the organization

The service profit chain is a well-known business framework that illustrates how customer experience is determined by the following factors:

  • Products and services
  • Personnel
  • Processes

The more processes, products, services and personnel (and usually also customers and/or outlets) you have, the more complex measuring customer satisfaction becomes.

Small businesses can get started quickly with simple survey tools such as SurveyMonkey or Typeform, free review sites such as Google Business Profile, a business page on Facebook or even sector- / product-specific websites such as TripAdvisor and G2.

However, for businesses with hundreds of thousands of customers and dozens of branches, a simple customer satisfaction tool will no longer suffice. In this case, a voice of the customer or customer experience program is necessary.


The sector  and target audience

Of course, there may be plenty of other factors that should also be taken into account, such as the industry you're in and target audience.

To give you an example, an older target audience does not require you to be as present online as you usually would.

Contrarily, a strong social media presence is crucial for restaurant owners or wellness centers where experience is at the core of the actual service. 

How do you measure customer satisfaction with surveys?

Perhaps the most popular format is traditional customer satisfaction surveys. The aim of multi-question surveys is to check different hypotheses with customers. While it may seem more efficient to ask all your questions at once, in reality, very few respondents are willing to fill out long surveys. As a result, the findings are often statistically irrelevant.

Shorter surveys combining customer experience metrics such as NPS, CSAT and CES with open feedback, tend to be more effective and attain higher response rates . After all, a simple score and open feedback question, is much easier to fill out.

When asking for feedback, it is essential to know the reason behind a score as these insights can really make a difference in your customer experience.

It is possible to manually go through and analyze open feedback and reviews on a smaller scale. However, on a larger scale, it is advisable to use feedback management and analysis tools, such as Hello Customer. Through linguistic analysis (NLP and AI) our tool extracts all relevant insights and dispatches them to the appropriate department. At the end of the day, what good are insights if they don’t reach the right people?

Let’s take a closer look at the 3 most important KPIs for measuring customer satisfaction. The key is to ask the right question at the right time depending on the interaction with your customer.

KPI 1: The Net Promotor Score (NPS℠)

The Net Promotor Score (NPS) is by far the most popular way of measuring customer satisfaction. It boils down to a very familiar scale question:

“On a scale from 0 to 10, how likely is it that you would recommend us to a friend or colleague  ?”.

Depending on the answer, the customers get classified in one of the following categories:

  • Promoters (9 - 10): These customers are very satisfied with your services and are very likely to spread positive word-of-mouth.
  • Passives (7 - 8): While these customers are still satisfied, it’s unlikely that they will speak of your company to others.
  • Detractors (0 - 6): These customers are less satisfied with your services. There is a good chance that they won’t speak very highly of your company to others.

This is a fairly easy way to send out your first customer satisfaction survey.

However, take into account that NPS is your go-to question for relational surveys which are meant to be used to measure your customers' overall satisfaction with your brand. Don't use them to measure your customers' satisfaction after a transactional interaction.

Takeaway: NPS is a relational metric to measure your customers' overall brand satisfaction.

KPI 2: The Customer Satisfaction Score (CSAT)

The Customer Satisfaction Score (CSAT) is a customer satisfaction survey that combines several questions about a specific interaction customers had with your company. All the questions are scale questions ranging from very unsatisfied to very satisfied.

The more positive responses, the higher your score.

It’s important to note that the CSAT score reveals little about the overall customer satisfaction, as it is only sent out after a specific interaction with your company.

Takeaway: CSAT is a transactional metric to measure satisfaction after a specific interaction with your company

KPI 3: The Customer Effort Score (CES)

The Customer Effort Score (CES) takes a significantly different approach. The entire survey revolves around the following question:

How difficult was it to make use of our services / find a solution for your problem / get a question answered?

This question can be answered on scale from 1 to 7. Similar to CSAT, this question is only sent out after a specific interaction, rather than giving you the bigger picture. In addition, as with many other surveys, CES surveys often include a secondary question to better understand the underlying reasons for a given score.

Takeaway: CES is a transactional metric to measure customer convenience after a specific interaction with your company

Let's get started!

Now that you know which customer satisfaction surveys are on the market, it’s time to get started. If you want to start sending out large-scale customer satisfaction surveys, then a customer feedback management tool such as Hello Customer is the perfection solution. This will allow you to analyze large quantities of customer feedback and automatically dispatch the relevant feedback and insights to the appropriate departments.

Don't know how to get started with your customer feedback program? Then check out our Start to Feedback guide.

Want to learn even more about these 3 metrics before getting started? Then be sure to download our e-book on NPS, CSAT and CES.