Measuring Customer Experience: NPS vs. CSAT vs. CES
Companies are starting to realize that just focusing on good customer service is quickly becoming a thing of the past. Companies that want to compete in today’s marketplace must focus on the overall customer experience (CX). This is likely due to the rise of digital and mobile platforms; customers have more touch points along their journey than they ever have before.
Even companies who understand the importance of an excellent customer experience weren’t exactly sure if they were successful in delivering it. Fortunately, there are tangible ways to measure success.
Why is it important to measure CX?
As with every facet of a company, customer experience needs to be tracked and measured for the purpose of improvement. It’s also important to measure CX because there’s a good chance your competitors are already doing so.
According to a recent report by Forrester, 72% of businesses say that managing customer experience is a top priority. To manage CX, companies need a precise and informative snapshot of the totality of their customers’ touch points.
Measuring CX with NPS
Net promoter score, or NPS as it’s more commonly known, refers to the amount of a company’s customers who would recommend the company to their friends and family. The most common and effective way of measuring NPS is through customer surveys.
Groove, a company that provides virtual support help desks for small businesses, set out to measure not just what their NPS is, but why it is what it is. This was accomplished by sending out a 2 question survey to their current customers.
In their survey, they asked their customers to rate, on a scale of 1-10, how likely they would be to recommend their services to a friend or colleague. They then divided the responses into 3 groups.
- Promoters – scored either a 9 or 10.
- Passives – scored a 7 or 8.
- Detractors – scored or 6 or below.
The second question asked in the survey is open ended: “What is the most important reason for your score?”
The survey allows companies the ability to measure their NPS, and provide valuable data that can assist them in implementing new practices to improve their score. According to analysis by Bain and Company, “companies that achieve long-term profitable growth have Net Promoter Scores (NPS) two times higher than the average company.”
Measuring Customer Satisfaction (CSAT)
CSAT refers to customer satisfaction and is also most often measured by surveys. People are usually familiar with CSAT questionnaires, even if they don’t quite realize what their purpose is. Typically, a CSAT survey will list the services, products, or customer touch points and ask the consumer to rate them on a scale 1-10, with 10 being ‘very satisfied’ and 1 being ‘not satisfied at all’.
So, what is the difference between CSAT and NPS? While they may seem similar in construction, they serve two entirely different purposes.
While NPS can provide a high-level view of a customer’s overall experience, a CSAT score offers a more detailed description of which components of the customer journey are in need of improvement. In addition, CSAT scores are indicative of a customer’s short term satisfaction, while NPS represents insight that is more long-term.
Customer Effort (CES)
A company’s CES is their Customer Effort Score, and as the name suggests, CES measures how much or how little effort is required by a customer to complete an interaction, transaction, or other communication with a company.
The CES was developed by Matthew Dixon, Karen Freeman and Nicholas Toman, authors of The Effortless Experience. It is their belief that customers care less about being “wowed” and more about a seamless, effortless experiences. The authors surveyed over 75,000 people who had recently had customer experience interactions with companies across many different industries. The survey showed that “delighting customers doesn’t build loyalty; reducing their effort—the work they must do to get their problem solved—does.”
An important metric, to be sure; but how is customer effort evaluated and measured?
As with CSAT and NPS, measuring CES relies on feedback from current customers. The first iteration of the CES survey asked customers “How much effort did you personally have to put forth to handle your request?” The survey then provided the customer with a choice of 1 to 5.
CX has proven to be a critical focal point for companies that want to establish themselves as big names in the industry or big names that want to stay on top of their game. The challenge lies within measuring something as seemingly intangible as an experience.
With NPS, CSAT and CES metrics, companies can measure long and short-term customer satisfaction as well as the seamlessness of the customer journey – all which go a long ways towards delivering a better customer experience