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Measuring and Improving Customer Experience: Key Metrics

Updated: Jun 5, 2023


Woman Facing Dashboard of Customer Experience Metrics

In today's highly competitive business landscape, organizations understand the significance of delivering exceptional customer experiences. Happy customers not only become loyal brand advocates but also contribute to a company's growth and success.


But how can organizations effectively measure and improve customer experience? In this blog post, we will explore three key strategies: Net Promoter Score (NPS), Overall Customer Satisfaction Score (CSAT), and Earned Growth.


Net Promoter Score (NPS) - The Most Common Of Customer Experience Metrics:

Net Promoter Score is a widely-used metric that measures customer loyalty and predicts business growth. It is based on a simple question: "On a scale of 0-10, how likely are you to recommend our company/product/service to a friend or colleague?" Customers are then categorized into three groups: Promoters (score 9-10), Passives (score 7-8), and Detractors (score 0-6).


To calculate NPS, subtract the percentage of Detractors from the percentage of Promoters. A high NPS indicates strong customer loyalty and a higher likelihood of organic growth through positive word-of-mouth.


To improve NPS, organizations should focus on addressing the feedback and concerns of Detractors, converting Passives into Promoters, and continuously monitoring and acting upon customer feedback.


Overall Customer Satisfaction Score (CSAT):

CSAT measures customers' satisfaction with a specific interaction, such as a purchase, support call, or website visit. It typically involves a simple question like, "How satisfied are you with your experience?" Customers can respond with options like "Very satisfied," "Satisfied," "Neutral," "Dissatisfied," or "Very dissatisfied."


To calculate CSAT, divide the number of satisfied customers by the total number of respondents and multiply by 100. A high CSAT score indicates that customers are generally pleased with their experience.


To improve CSAT, organizations should focus on delivering consistent, high-quality experiences across all touchpoints. This involves listening to customer feedback, addressing pain points promptly, and providing personalized solutions.


Earned Growth:

Earned Growth is a newcomer among customer experience metrics. Also known as "customer-driven growth," this metric focuses on leveraging customer loyalty and advocacy to drive business growth. It involves fostering positive customer experiences to generate organic growth through referrals, testimonials, and positive online reviews.


Earned Growth is calculated by combining all customer renewal revenue with any net new customer revenue that did not come from paid acquisition (most likely sources would be referral or word-of-mouth promotion that generated a new new customer).


To promote earned growth, organizations should prioritize customer satisfaction and ensure that every interaction exceeds customer expectations. This includes providing exceptional service, personalized experiences, and proactive problem-solving.


Additionally, organizations can encourage customers to share their positive experiences through referral programs, loyalty rewards, and social media campaigns. By harnessing the power of customer advocacy, organizations can attract new customers, enhance their reputation, and drive financial growth.


Measuring and improving customer experience is a crucial aspect of building a successful business. By implementing a complementary set of measures such as Net Promoter Score, Overall Customer Satisfaction Score, and Earned Growth, organizations can gain valuable insights into customer sentiment, address pain points, and create experiences that foster loyalty and advocacy.


Remember, customer experience is not a one-time effort; it requires ongoing monitoring, analysis, and adaptation. By prioritizing the voice of the customer and continuously striving to deliver exceptional experiences, organizations can cultivate strong relationships, drive customer loyalty, and ultimately achieve sustainable growth in today's competitive marketplace.

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