Through the internet, today’s customers are often better informed than your own team about something they truly need or want. It is therefore important that you not only focus on your product, but also on the service and experience around it. One way of knowing if you are on track with this is to measure customer satisfaction.

What exactly is customer satisfaction?

Customer Satisfaction is a metric where you measure the degree to which a customer is happy about the product, service or experience you offer.

So it is actually customers telling you how they feel about interacting with your product and your organisation. It tells you a lot about whether they will become loyal customers or not. And is thus an important indicator to gauge whether you are on the right track. The way we measure customer satisfaction is mostly through surveys.

Why is measuring customer satisfaction so important?

If you don’t measure customer satisfaction, how will you know in which direction your product or service should go? You won’t know which customers are unhappy and why, or will discover this too late as they are already churning. As it is way harder to find new customers than to keep existing ones, it is good business to invest in measuring customer satisfaction.

For example, Onsophic CX started out measuring customer satisfaction at an international financial service organization. As soon as we started asking customers for feedback, we could see a  double effect. Firstly, the company was able to spot potential churners a lot sooner and were able to act upon it. But secondly, what we also noticed was that asking for feedback alone was dropping churn! Simply giving customers the chance to give feedback made them more loyal to the company. The company reduced churn by more than 10% in the first 4 months of measuring customer satisfaction. 

At another organisation, we’re using customer experience insights to help them deliver exceptional experiences across more than 500 branches. Read the full case study here.

How do you measure customer satisfaction?

Typically, customer satisfaction is measured by using surveys and asking the right questions. But what are the right questions and when do you ask them? To determine the right customer satisfaction question, it is relevant to look at different ‘customer satisfaction metrics’:

Net Promoter Score (NPS)

Use this metric to gain insights into your company’s ‘promoters’, ‘detractors’ and ‘passives’. You basically ask the question “How likely are you to recommend our product and services to a friend or colleague?”. The customer can answer with a score from 1-10. A score from 1 to 6 is negative, so we call them detractors. The passives give a score of 7 or 8. The promoters are the ones that give a score of 9 or 10. The ‘Net Promoter Score’ is then calculated by subtracting the percentage of detractors from the percentage of promoters, and can be a result ranging from  -100 to +100. This gives you a basic understanding as to how your company is doing.

Customer Satisfaction Score (C-SAT)

Another very popular scoring method is the Customer Satisfaction score itself, or C-SAT. You ask customers the question “How happy are you with our products and services”, and allow the customers to score from 1 to 10. The average of all customers’ answers will give you a C-SAT rating between 1 to 10. The higher the C-SAT rating, the better your organisation is performing.

Also very insightful is to add an “open remarks” text field, where customers can give more information about why they gave their score. This will provide more specific information on how to improve your company’s customer satisfaction.

So, there you have it. Customer satisfaction is very important because it helps you gain insights, reduce and prevent churn, and identify happy customers that can become your ambassadors. Besides that, it is one of the key differentiators in today’s competitive business environment.

If you would like to learn more about how to create a strategy to increase customer satisfaction, make sure to read our Customer Experience Management page.

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