The jargon-free guide to customer satisfaction metrics

On a very basic level, it’s pretty intuitive to tell if someone’s satisfied. If they’re smiling? They’re probably happy. If they’re crying, screaming, or flipping tables? Well, they’re probably unhappy.

Heck, even infants as young as four months old have been shown to correctly identify between different emotions based on facial expressions alone.

But things aren’t quite so simple when it comes to assessing overall customer satisfaction. For starters, you don’t always have the luxury of picking up on those always-helpful nonverbal cues—and those aren’t a particularly scalable or even reliable measure of happy customers anyway.

With hundreds or thousands of customers, you need an easy way to take all of those unique preferences, expectations, and experiences and translate them into a general, actionable read on their satisfaction levels.

That’s where customer satisfaction metrics come into play. They help you get a tangible and quantifiable understanding of how your customers feel about your business.

Summary
This article discusses the four key customer satisfaction metrics: customer satisfaction score (CSAT), Net Promoter Score (NPS), Customer Effort Score (CES), and Customer Health Score (CHS) surveys.

It also covers the benefits of using customer satisfaction surveys generally, with the ultimate takeaway being that every business should use them! They provide valuable feedback on customer experiences, which helps you understand your customers' needs and preferences. This data can then be used to improve your products, services and customer support, which can increase customer loyalty and retention, and ultimately lead to higher profits.

Additionally, customer satisfaction surveys demonstrate to customers that your business values their opinions and is committed to providing the best possible experience. Check out the Paperform templates linked within the blog post to get started with your own branded customer satisfaction survey in minutes.

What exactly are customer satisfaction metrics?

You’re probably picking up the gist of customer satisfaction metrics from the name alone. They’re numerical scores that summarize and indicate how your customers feel about your business.

Calculating these scores typically involves surveying your customers (often with one simple question), collecting their responses, combining the answers, and doing some simple math to end up with an actual digit.

That number indicates how your business is performing in a specific area—whether it’s overall satisfaction, customer loyalty, customer sentiment, customer retention, or whatever other digital customer experiences you decided to collect and quantify.

Why bother with customer satisfaction metrics?

We probably don’t need to preach to you about the value of customer feedback. You know that regularly touching base with your customers to gather their insights is crucial for improving your customer interactions and fueling business growth.

And yet honest, helpful feedback can be tough to collect for a few reasons:

• Customers aren’t inclined to provide feedback in the first place. Research shows that less than half (48%) of customers leave one review every month. They’re selective about where and when they’ll offer insights—if they decide to do so at all.
• Customers are more likely to share negative experiences. You’ve probably heard the assertion that customers would much rather spread bad news. While there’s some debate about whether that statement holds water, it’s true that humans are hardwired with a negativity bias. Plus, negative experiences increase our stress, which means we remember them longer.
• Customer feedback can be tough to aggregate. People have unique experiences with your business. Someone might’ve had a flawless customer service interaction while somebody else had a terrible service experience. Those disparate takes can make it hard to take a real pulse on the collective experience.

So why bother with customer satisfaction metrics at all? What makes them so powerful? They’re typically short, easy, and use a rating scale—which means you avoid the above roadblocks. And these key metrics offer a number of other notable benefits, including:

1. Improve the customer experience

This is the big one. Your goal in collecting customer satisfaction feedback is to get the information you need to exceed customer expectations and improve your customer relationships.

“Customer satisfaction metrics provide us with valuable insights into how our customers feel about our products, services, and overall brand experience,” explains Isaac Robertson, Co-founder and Chief Editor at Total Shape.

In short, when you keep your customers happy, you can achieve increased retention, more referrals, and higher revenue.

2. Proactively spot problem areas

“Customer service metrics enable us to anticipate issues and pivot quickly to improve our performance,” says Amy Bos, Cofounder and COO at Mediumchat Group.

More thorough customer satisfaction surveys can be sort of daunting for your customers and for your internal team. But tracking your customer satisfaction metrics is meant to be quick and actionable.

That means you can readily identify areas for improvement and make changes—without waiting for a comprehensive annual survey.

3. Make data-driven decisions

It’s easy to make assumptions about how your customers feel. But customer metrics and customer satisfaction KPIs aren’t hunches or best guesses—they’re data.

These scores give you real, hard numbers that you can use to inform your decisions and strategies, as well as easily monitor your progress.

4 customer satisfaction metrics to start tracking

That brings us to the question that everybody really wants the answer to: What key customer satisfaction metrics should you keep an eye on? Here are four that will help you readily discern between happy customers and unhappy customers.

1. Customer satisfaction score (CSAT)

Use it to measure overall customer satisfaction.

Duh, right? If you want to gauge customer satisfaction, this one seems painfully obvious. But let’s talk about how it works.

This score measures overall customer satisfaction with something, whether that’s a specific purchase, a certain customer interaction, or even your business as a whole. To collect this score, you ask your customers one straightforward question: how satisfied were you with your experience?

Customers then rate their satisfaction using a scale. Usually, they’ll rate their experience on a scale of one (extremely dissatisfied) to five (extremely satisfied), but some companies also use a one to 10 scale.

When you’ve collected all of your customer responses, you’ll use this simple formula:

Number of satisfied customers ➗ Total number of survey responses X 100 = % satisfied customers

What customers can you count as satisfied? That depends on the rating scale you chose. Here are the typical benchmarks:

• Scale of 1-5: Count customers that rated you with a 4 or 5
• Scale of 1-10: Count customers that rated you with a 9 or 10

Let’s look at an example using the five-point scale. Imagine that you surveyed 583 customers and asked them to answer the above question about satisfaction. 512 customers gave you a rating of four or five. Plug those numbers into your formula:

512 ➗583 X 100 = 87.8% of your customers are satisfied

Hey, not so bad. If the number comes in lower than you were expecting, that’s your cue to dig in (and even ask some follow-up questions, if customers are willing to participate) to figure out how you can improve moving forward.

2. Net promoter score (NPS)

Use it to measure how likely customers are to recommend you to others.

This metric has the word “promoter” right in the name, which tells you a lot about its intent: it helps you understand how willing your customers are to promote your brand to other people.

“We find it to be an excellent indicator of overall customer satisfaction and loyalty. We use this metric to assess how well we are doing in terms of meeting our customers’ needs and expectations,” says Robertson.

Again, this one starts with asking your customers one question:

How likely are you to recommend our company to a friend or colleague?

Your customers will use a zero (not at all likely) through 10 (extremely likely) rating scale to indicate their answer to the question. When you’ve collected their responses, you’re ready to use the NPS calculation.

That starts by sorting your responses into three different groups: \

• Promoters: People who responded with a nine or 10 rating.
• Passives: People who responded with a seven or eight rating.
• Detractors: People who responded with a zero through six rating.

The NPS calculation only uses the promoters and detractors. You’ll subtract your percentage of detractors from your percentage of promoters to get your official Net Promoter Score. So, if you have 60% promoters and 5% detractors, your NPS is 55.

What’s considered a good score? Most experts agree that anything above zero is solid—it indicates you have more promoters than detractors. But a score above 50 is particularly top-notch.

3. Customer effort score (CES)

Use it to measure how easy it is for your customers to do something.

This is another metric that has a big clue right in the name: effort. You’ll use this one to understand how easy it is for your customers to do something specific—whether it’s using your product, interacting with customer support via cloud contact center, completing a purchase, or anything else you’d like to assess.

Effort is a huge indicator of overall satisfaction and even loyalty. “As a digital platform, if a customer needs to use a high amount of effort to resolve issues or reach their end goal, we need to find a better solution. The lower effort a customer has to make, the more likely they are to continue using our platform,” says Bos.

We might sound like a broken record, but this one also uses a single statement or question:

[Company] made it easy for me to [task].

Customers will rate their agreement on a seven-point scale, where one indicates strong disagreement. To calculate your CES, you’ll figure out the percentage of customers that at least somewhat agreed with the statement (meaning they scored you with a five or above).

If you surveyed 1,200 customers and 982 rated you with a score of five or higher, you’d divide 982 by 1,200 and then multiply by 100. That gives you a CES of roughly 82%, meaning 82% of customers think it’s easy to work with your brand. That’s a solid score.

4. Customer health score (CHS)

Use it to measure how likely a customer is to stick with your business.

This metric is exclusively focused on retention—it helps you figure out whether a customer is at risk of hitting the road so you can take proactive steps and (hopefully) reduce your customer churn rate.

This one is a little different from the others in that there isn’t a set formula to follow. Rather, you’re creating your own unique scoring system to evaluate and monitor your customers.

The gist is that you identify the different ways you’ll measure customer health (called predictive metrics, if you’re feeling fancy). Think of these as the indicators that a customer is super engaged with your brand—it could be feedback, website activity, social media tags, or something else that feels meaningful to you.

When you know what those are, you create your scoring system. This is highly-personalized to your business but should also be something that your entire support team (and even your entire organization) agrees on.

For example, leaving a negative rating after a customer support interaction would subtract points from the customer’s score. But referring a customer to you would add points. You get the idea.

It’s the most flexible of all of the customer satisfaction metrics included here, but it’s an incredibly valuable one for understanding which customers are at the greatest risk of turning over so you can take action—and improve future interactions too.

Beyond the digits: Tips for collecting and using customer satisfaction metrics

The metrics themselves are pretty straightforward, but there are a few other tips to keep in mind to ensure your desire to check in on your customers doesn’t backfire.

1. Collect feedback regularly

Feedback is a dish best served frequently—particularly when things can change quickly and often. Build in regular and frequent opportunities for customer feedback, like a Paperform survey at the end of customer service interactions or a simple email a few weeks after someone makes a purchase.

You could even run a periodic survey that asks all of the above metric-driven questions to knock off all of your score calculations in a single questionnaire.

The point is that you need to regularly collect feedback during the customer lifecycle. That will arm you with accurate, real-time data you can use to continuously run your customer satisfaction metrics and keep tabs on any changes.

2. Keep it short

There’s a reason that almost all of these scores are based on only one question: your customers are busy.

They don’t have time to answer dozens of questions (admit it: you hang up every time your doctor’s office asks you to complete the brief, two-minute phone survey). That’s why you need to keep your requests for feedback as brief as possible. It’s less daunting for customers and will hopefully yield a higher response rate.

Even when they’re concise, most customer satisfaction surveys have a response rate of 10 to 30%. So, while you won’t get everybody, those insights are certainly better than none.

3. Use the right tool

There’s nothing worse than a company that collects a bunch of data but then doesn’t do anything with it. Information is only information—it’s up to you to act on it to make meaningful changes for your customers and your business.

That’s far easier to do if you have the right tool to collect responses in the first place. Paperform integrates with the tools your team is already using so you can easily send the data to other platforms.

Transform your survey responses into Trello cards, Slack messages, spreadsheets, or whatever else you need to turn that data into action.

4. Focus on your overarching goals

Your customer satisfaction metrics aren’t necessarily destinations themselves—they can support other broader business goals. This isn’t about getting high scores for the sake of high scores.

So before rolling out all of the questions and calculating your metrics to see how you stack up, take a step back to understand what your entire business is trying to achieve.

Are you trying to position yourself as a trusted expert in your industry? Then NPS is probably a good fit for you. Are you focused on reducing your customer churn rate? Then you need to run a CHS first and foremost.

If you’re familiar with the SMART goal framework, the “R” stands for “relevance.” That means whatever metrics you focus on need to be meaningful to and impactful for your business.

Get into your customers’ shoes brains

Figuring out if you have happy customers or unsatisfied customers isn’t quite as simple as looking for smiles or tears. In fact, it can be pretty challenging to truly understand your customer journeys, as well as how your business ranks in your customers’ minds.

That’s the benefit of customer satisfaction metrics. They give you a real, quantifiable understanding of how your business is performing in a certain area, whether you want to work toward more loyal customers, improve your brand identity, or assess overall satisfaction.

And the best part? They don’t have to involve a ton of effort. In fact, they’re relatively easy for both your business and your customers—and a heck of a lot more reliable than a facial expression.

Ready to find out how your customers really feel? Get started with Paperform for free today.

Related reading

• Customer Appreciation: 15 Memorable Ways to Thank Customers
• A Guide to Creating Great Customer Satisfaction Surveys
• Customer Retention: 8 Strategies That Build Loyalty & Boost Profits
• What is Customer Effort Score?
• How to Build Brand Loyalty with a Customer Rewards Program