What metrics to use in CX research?
This is the third blog in our fundamentals of customer experience management series. Let’s now focus on what metrics to use in CX research and how to get the most out of them.
There are quite a few Key Performance Indicators (KPIs) in use these days by businesses, all with their own acronyms.
Net Promoter Score (NPS)
Customer Satisfaction Score (C-Sat) or Index (CSI)
Customer Effort Score (CES)
Each of these KPIs, if tracked, will give you some idea of whether you are meeting your customers’ expectations.
So how should you choose the KPI that best suits your business?
It is useful to know that, generally, customer satisfaction, intention to repurchase and likelihood to recommend tend to correlate strongly with each other. And when there are particular issues within your business, they can often show the same key drivers as having most impact.
However, certain KPIs are more suited to certain types of CX programme. NPS is boardroom friendly, holistic and links strongly to loyalty. But recommendation encompasses more than just customer experience and not everyone recommends. Satisfaction is universally understood and a comprehensive measure, but satisfaction doesn’t always mean growth nor does it predict behaviour. Customer effort, which helps focus on pain points and is gaining momentum as ease of use becomes increasingly important, works better at touchpoint level and neglects wider aspects of the brand experience.
We can help you choose the most relevant KPIs. However, the most important thing is to pick a measure and stick with it. Uncover what impacts your score through additional product or service questions or by linking your KPIs to verbatim feedback.
How to use KPIs
Benchmarking and comparing KPIs with other businesses tends to be an area of interest. However, too much focus on benchmarking can distract from what really matters to your customers as set out in an article by Customer Sure about benchmarking. One of the points made was “How does it help to know you’re no worse than anyone else?”. Benchmarking doesn’t focus on how you are meeting your customers’ expectations so may be of limited value.
After picking a KPI and sticking with it, the next 2 steps are vital:
1) Act and improve
Once you know where you should prioritise your improvements, you should create an action plan and identify who is responsible for implementing what.
2) Gauge return on investment
When implementing your actions, take time to assess how many dissatisfied customers have been won back. Improvements should increase loyalty and change detractors into customers that feel part of and engaged with your brand. The value to the organisation is to maintain and increase business (through cross selling and positive word of mouth). Link your action plan to customer value and profits and you will know how running an effective CX programme can make money for your business.
The bottom line
At times, businesses fail to act upon findings from CX insight programmes and rarely will they take time and effort to measure return on investment effectively. So our recommendation would be: it doesn’t matter that much which KPI you use, it is what you do with it that counts.
A full version of the topics discussed in this blog series is available in a free pdf guide. Download the full version of The Fundamentals of Customer Experience Management.
In our next blog we explore the principles of Action management.