Let’s start with “Why”, like Simon Sinek recommends. (1) Before we dive deep into the topic of how to choose the right customer experience metrics, we have a more pressing question to ask. Why do organisations need to measure “customer experience” in the first place?
There is no motion without emotion
The human brain decision mechanism operates with experiences. This learning organism tends to collect experiences, transform them into memories and then make the limbic system. What we call the limbic system is the storage of memories and emotions. Now, because emotions mostly trigger all of our actions, experiences prove to be of greatest importance in customer behaviour.
There are good and bad experiences in the journeys of consumers with a brand. Among these, what makes a Love Brand?
Not every experience has the same effect. To get much more accurate and actionable results, companies should first discover end-to-end customer journeys using customer journey analytics. A journey-oriented customer experience seems to be essential in the prioritisation of fixing frictions. This strategy will also reveal your company strategy as well. Customer journey analytics enables businesses to design cross-channel activities, determine the pain points, and prioritise initiatives based on potential financial impact.
The next smart thing to do would be to define your differentiating claims of the selected journeys. Do you bet on being the fastest? The cheapest? The easiest? This claim would lead you to the right measure and how to track it.
Let’s assume that you have prioritised your journeys and defined your initial claims. Just like Maslow’s hierarchy of needs, the first stage of the CX pyramid covers the basics: how effective is a company in meeting their customer’s needs?
- From the basics: “Does my CX meet my customer’s needs?”
- To more advanced questions like: “Is my CX easy to use and navigate?”
- Then, a more mature phase: “Is my CX enjoyable for my customers?”
The CX Pyramid measures customer loyalty in logical order from the baseline essentials to more sophisticated business metrics. Now, why you should consider how to choose the right customer experience metrics? It’s because the perfect ones are meaningful to the specific customer touchpoint you’re wanting to analyze.
Customers have feedback fatigue from being asked for their opinion by every company after every interaction. Therefore, you want to ensure that you reach out to measure customer experience at the most important moments, also known as ‘moments of truth’. If you are not tracking the entire customer journey, you will likely fail to measure important interactions and thus miss the step that is failing and that needs improvement.
In a recent CX survey, only 21% of respondents are very or extremely satisfied with their ability to quantify the impact of CX on business metrics. (2) The truth is, there isn’t one metric that is better than others. All three add value to your CX program, you just need to use them strategically.
1. Net Promoter Score® (NPS)
NPS stands for Net Promoter Score. An easy way to define NPS is to think of it as a growth indicator. After all, it’s a customer satisfaction metric that helps you find out:
- How satisfied consumers are with your products/services;
- How loyal they are to your brand;
- How likely customers are to recommend your company to others.
2. Customer Satisfaction Score (CSAT)
CSAT stands for Customer Satisfaction Score (not very intuitive, we know) and it – like the name implies – is a CX metric that directly measures customer satisfaction levels.
CSAT surveys are ideally sent when you want to see how happy clients are with an action your business took, or certain aspects of your products/services.
3. Customer Effort Score (CES)
CES stands for Customer Effort Score. A good CES definition outlines it as a metric that’s used to measure customer satisfaction levels by focusing on the efforts customers make to interact with your business’ services and products.
The idea of the survey is to help you find out if customers have a hard time performing certain actions when interacting with your brand, and take the necessary actions according to the survey data to streamline processes. NPS still stands as the most advantageous metric.
Before you decide what to measure, you should have a crystal clear strategy and a mechanism to collect feedback from your customers. There are two types of customer data that you should collect: structured data and unstructured data.
Structured data is information that does not have a predefined data model or is not organised in a predefined manner. In other words, structured data is quantifiable (demographics, ratings on a scale of 1 to 5, or true/false responses, customer transactions, footprints on the touchpoints) while unstructured data is qualitative (call center calls, open-ended survey comments, or social media posts).
Structured and unstructured data may provide opposing views, and digging deeper into the reasons why can open new opportunities. Whether examining customer satisfaction scores or sentiment feedback, thoughtful data-driven analysis is the key.
Therefore, it is not difficult to say that the optimum analysis would be to combine both data types together and change the approaching angle, depending on the journey. For example, customer complaints appear to be one of the basic indicators of CX but not sufficient enough to reveal a clear diagnosis.
For every complaint you receive from a customer, there are approximately 26 other people who are unhappy with your company, but choose to say nothing. Those are clients you will most likely lose if you don’t take proper action. Complaints have an indirect impact on NPS, which should be examined closely.
Something to keep in mind is to be able to understand customer feedback sentiment and the impact of your customer feedback on your NPS, including the bottom line like revenue and customer value. By not just collecting, but also analysing feedback, you get access to real customer insights.
Beyond traditional metrics
In recent years, market research techniques that were once considered unconventional have become routine, and even necessary for companies looking to enjoy results. Take, for instance, the fact that 33% of researchers now conduct less market research face-to-face than they did only three years ago. (3)
This is just one piece of evidence that points towards innovation in market research techniques and is now necessary, not optional. The reason behind this is that brands are aware that it’s not possible to understand consumer behaviour solely depending on Q&A-based methods.
Plenty of new methods are being tested to understand and improve CX, moreover customer labs are being launched in order to combine traditional methods together with innovative researches such as;
- Neuro researchers
- VR tests
- Gamification and surveys
- IoT and geolocation
- Online collaboration tools
- Video content analysis
- Social media mining and content analysis
To wrap up:
- Choose a journey-based approach and prioritise
- Gather data and feedback from all types of interactions, from the maximum number of customers and many touchpoints
- Combine your structured and unstructured data with drivers of loyalty, revenue and behavioural metrics.
- Next big thing! Once this mechanism will start to operate properly, these 3 steps will lead to the use of predictive analytics to bypass traditional CX measurements. In other words, you will have a full-fledged understanding of your customers even without running researches.
- Start with Why: How Great Leaders Inspire Everyone to Take Action, by Simon Sinek
- Measure CX Performance: Looking Beyond Net Promoter Score
- 2020 State of Customer Journey Management and CX Measurement Report