Marketing & Customer Experience Hub

Are your customer experience metrics cutting it?

Are-your-metrics-cutting-it

You cannot manage the improvement of your customer experience if you don’t measure it. That’s rule number one. Rule number two is not to rely on your customer experience metrics to do all the work. Let me explain.

In a bid to improve customer experience and prove its worth to the C-suite, firms are on a continuous search for the Holy Grail – that performance metric that will tell them once and for all what they are doing right.   Better yet, a customer experience metric that can predict which customers will stay and which ones will go.

Are your metrics cutting it

Over the past 20 years or so, we have seen a myriad of customer experience measurement models enter the arena.

With our increasing awareness that high levels of satisfaction are not sufficient to produce loyal customers, we’ve moved from simple customer satisfaction surveys to the Net Promoter Score or very targeted metrics such as the Customer Experience Index – all with the aim of helping us illustrate how seemingly small transactional experiences are driving critical outcomes.

Now companies are using a wide combination of these metrics, desperately hoping to gain insights or those little nuggets to deliver against their customer experience ideals.

Customer experience measurement

So which customer experience measurement should you be using? And are your chosen metrics cutting it when it comes to helping you improve the customer experience?

Let’s take a look at the options:

1. Net Promoter Score (NPS)

It’s been over a decade since the Net Promoter Score (NPS) was introduced and it’s had a strong influence on customer experience measurement ever since. The NPS is obtained by asking customers to rate their experience on a 0 to 10 scale, where 10 is “extremely likely” and 0 is “not at all likely”.  We’ve all done it; you call your utilities provider and a week later they send a link to an online survey with a series of questions.

The one question that really counts is this: “How likely would you be to recommend the company to others?” The Net Promoter Score is a simple calculation of the percentage of detractors subtracted from the percentage of promoters.

The challenge of the NPS, however, lies in the post-measurement phase. NPS is a general indicator of whether customers like you, but it does not necessarily show you the granular insights of where to aim your efforts and how to improve.

Some commentators even go so far as to deny any correlation between NPS and business growth. Nonetheless, the NPS above all other metrics is the one eagerly awaited by management.

2. Customer Effort Score (CES)

Ever since it was introduced in that eponymous 2010 Harvard Business Review article by Matthew Dixon et al, the Customer Effort Score (CES) has been vying for supremacy as the Chosen One of customer experience metrics. The CES measures the effort a customer must expend to do business with a company.

Here, the all-important question is: “How much effort did you personally have to put forth to handle your request?”, with answers scored on a scale from 1 (very low effort) to 5 (very high effort).

Many believe a Customer Effort Score is a better predictor of loyalty than the Net Promoter Score, as when customers have to expend more effort than they expected, they leave. In the HBR article, the authors found that 94 per cent of customers who reported expending low effort said that they intended to repurchase a product or service. High effort equals low customer loyalty, and the CES helps you monitor this.

The added value of the CES is that it can be transaction-based and thus much more actionable than other broader measures. If the company is scoring low, you know immediately where you have to focus to make it easier for customers to get what they need.

On the contrary, if your organisation has poor NPS scores, you have to keep digging to find out why a customer is reluctant to recommend you to others.

3. Customer Satisfaction (CSAT)

“Overall, how satisfied are you with our company?” – Customer Satisfaction (CSAT) is one of the original measures, addressing how satisfied current customers are with the product, service or particular interaction they have just completed.

One of the measures feeding into a CSAT score is First Call Resolution. However, critics of CSAT will argue that the results are too basic and devoid of emotion. By focusing on a specific interaction, customers aren’t thinking about their wider relationship with the organisation and for this reason it is a weak predictor of future behaviour.

4. Customer Experience Index (CxPi)

Not satisfied with the existing measure of customer experience, in 2007, Forrester Research developed the “Customer Experience Index” (CxPi) to help organisations benchmark their customer experience against competitors and across industries. With the goal to identify the key drivers of the customer experience, CxPi is based on customer feedback on three factors: usefulness or meeting needs, ease of use, and enjoyability.

The “So What?” Factor

Chances are you are already using a combination of the above metrics, and maybe more besides. But when it comes down to it, it’s not a matter of which is better or worse at measuring the customer experience. After all, as you’ve seen above, they all measure different things.

The real answer lies in how smart you are in interpreting the results and putting these insights into action to improve the customer experience. Take NPS; many companies use their Net Promoter Score to provide a point of comparison against their competitors and shout it loud and proud to their customers. But while it is helpful in demonstrating customer delight, does the score tell you how to improve the experience should it not be up to scratch?

What I’m talking about is the “so what?” factor. You wait on tenterhooks for these all-important scores and metrics, but they are futile unless you know what to do with them.   Getting the customer experience you and your customers want requires in-depth insights that will point the organisation in the right direction.

In a recent survey, 65 per cent of CX “masters” compared with 10 per cent of “laggards” said their customer metrics are effective in providing actionable insights they can use to improve the customer experience.

Some companies, such as UK telecoms company BT, have gone so far as to pioneer their own measurement system – “Net Easy Score” – to meet their unique business goals. I’m not suggesting you reinvent the wheel, but you do need to make sure the measurements you are using, and the way in which you collect them, are aligned to your goals.

Finally, it’s important to remember that scores aren’t everything. Customer moments are dynamic, diverse experiences, and asking questions and relying on recall doesn’t do them justice.

Scott McMillan - General Manager - Business Consulting, Salmat About Scott McMillan - General Manager - Business Consulting, Salmat
Scott McMillan is Salmat\'s General Manager of Business Consulting. He has a passion for driving exceptional customer experiences through multi-channel environments. He believes that finding the right equilibrium between people, process & technology can create real world opportunities for all organisations. A strong proponent of finding the right ‘mix\' is ensuring you evangelise the ‘outside in thinking\' principles.

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