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Customer experience (CX) is your organization’s primary differentiator. Customer expectations have evolved tremendously over the past few years. Yet how we measure customer experience hasn’t kept up.
Genesys partnered with Harvard Business Review (HBR) Analytic Services to create a new global survey of 438 senior executives worldwide. In the report, “Beyond NPS: CX measurement reimagined,” 92% of surveyed respondents said being better able to measure the customer experience would help them deliver better business outcomes.
Effectively measuring customer experience is a requirement for both customers and businesses to succeed. But it’s a major challenge for most enterprises. Siloed data and a web of existing systems and platforms complicate things even more.
In this blog, we’ll discuss common ways to measure customer experience. And we’ll look at how to use customer journeys to improve CX measurement and deliver the frictionless, empathetic experiences consumers desire.
To measure customer experience, most CX professionals rely on metrics such as Net Promoter Score (NPS) and customer satisfaction (CSAT) scores to gauge performance. Though widely adopted, these metrics have limitations.
A 2021 study predicted that more than 75% of organizations will have abandoned NPS as a measure of success for customer service and support by 2025.
You need an actionable way to measure customer experience. Improving customer experience measurement enables you to listen and learn from your customers so you can deliver the experiences they demand.
According to Forrester, there are three types of CX metrics you can use to understand how customer perception and behavior impacts business objectives:
These metrics relate to what your customers expect from their overall experience with your enterprise. The goal is to understand how customers feel about their experiences.
Many CX leaders rely on surveys and speech or text analytics to gauge customer sentiment. Voice of the Customer (VoC) programs are a standard way to capture their perception — and the metrics used often include satisfaction, ease and confidence.
The key is to measure your customer’s satisfaction with the entire path they take to achieve a specific goal, rather than in aggregate or after a single interaction in a single touchpoint.
2. Interaction Metrics
Interaction metrics look at what actually happens during a customer’s path toward achieving their goal, such as paying a bill or transferring money between accounts. This data derives from your website, contact center, and physical store or branch locations.
CX leaders can use interactions to understand how actions in different channels impact your customer’s perception. For instance, does a long conversation with an agent cause customer effort or CSAT metrics to plummet?
Or are your customers happy the agent was thorough and resolved their issue? Perhaps long wait times actually frustrate customers more than issues with your product or service.
To improve interactions and overall experiences, consider internal initiatives that impact your customer’s perception. This may include implementing a call back feature to mitigate long wait times or improving a FAQ page for customers troubleshooting product or service issues.
3. Outcome Metrics
Outcome metrics measure the repercussions of your customer’s perception and interactions. Ultimately, outcome metrics measure what your customers intend to do as a result of their experiences with your organization.
This type of metric, such as NPS, number of service upgrades or products purchased, derives from surveys, financial data and, of course, customer behavior data. To define these metrics, identify key business outcomes for each goal your customers want to achieve. This can include acquisition, cost reduction, increasing revenue per user and more.
There are several key criticisms of traditional metrics like NPS that are completed after the conclusion of a sale or service interaction. They provide limited insight to the moments where loyalty was won or lost.
They don’t often identify root causes of customer frustration. And they’re more business-centric than people-centric. Plus, some 41% of surveyed executives say they can’t explain why CX metrics go up or down.
One of the greatest opportunities identified in the HBR survey is being able to better understand the quality of experiences earlier in a customer journey. Just 28% of executives said their organization has a very good understanding of customer satisfaction across all phases of a customer journey.
As the focus on traditional survey-based metrics would suggest, they’re most competent in gathering post-interaction feedback. Moving to a customer journey-based approach is a key priority for 81% of the respondents. And nearly half said their organization plans to increase investments in measuring customer experience.
The Call Center Analytics Manager at a leading internet service provider (ISP) regularly monitored metrics like first-contact resolution (FCR), average handle time (AHT), call duration and more. She had a goal to decrease call duration to minimize costs.
But by shortening calls, customers didn’t get the service they needed and actually required in-person assistance. The ISP had to send service technicians to help customers. Costs associated with truck rolls increased customer service costs by 10X.
When you measure customer experience metrics in a vacuum, you’re likely to optimize the wrong things. But by analyzing the entire customer support journey, the call center manager realized that a majority of customers troubleshooting connectivity issues rely on an agent to help them.
For these journeys, taking the time to quickly diagnose and solve internet connectivity issues benefited the provider and their customers experiencing these problems.
Aligning your organization around customer journeys is key to customer journey management. This approach enables organizations to visualize, measure and optimize end-to-end customer journeys by connecting customer behavior to CX and business outcomes.
Increasingly, leading enterprises are adopting a journey-based perspective to measure customer experience.
When metrics like NPS or CSAT decline, most CX leaders don’t know where to look first.
That’s the advantage of customer journeys. When using a journey-based approach like customer journey measurement, you’ll know exactly where to look when your KPIs rise and fall.
Earlier, we mentioned that the most actionable way to measure customer satisfaction is by tracking that metric for each major customer goal:
When satisfaction rates fall for support journeys, you’ll know where to start investigating. This might include contact center channels like voice, chat or the IVR. With the right direction, you can discover the root cause of fluctuations in metrics quickly.
And you’ll know exactly which actions to take to solve those issues and improve experiences.
By leveraging a journey-based approach, you can:
Journey-centric organizations invest in approaches and technologies that increase their ability to measure customer experience beyond isolated interactions in siloed channels. Customer journey analytics solutions have exploded in popularity as a means to measure omnichannel experiences, predict journey outcomes and identify opportunities for improvement.
Every CX leader is measuring customer experience KPIs, but many lack the means to connect these metrics to business outcomes. In the 2021 State of Customer Journey Management and CX Measurement report, 41% of companies said that they capture improvements in metrics like NPS or customer satisfaction, but are challenged to translate that into revenue or costs.
Here are four ways you can use journey measurement to provide empathetic and personalized experiences that can improve CX and business outcomes.
The customer experience community often discusses choosing metrics that capture value. But who’s receiving that value? Take a step back and consider your customer first, then your organization.
Traditionally, businesses set goals like increasing digital containment rates or cost to serve. These are great goals to have and are indicative of the health of your enterprise.
However, these goals don’t capture the value your customers get from your organization. Being a customer-centric organization means that you start with your customers’ goals and then align them to your business goals.
For example, a bank or a lender that sells mortgages likely has goals such as:
But the consumer has different goals, including:
Your CX measurement framework must include customer goals first and foremost. Then, you can align customer goals with CX metrics such as Customer Effort Score (CES), satisfaction or NPS for each customer journey.
This way, you can ensure that you’re monitoring the metrics that actually impact business goals, such as lifetime value, costs and revenue.
Here’s an example of how those customer goals can map to CX KPIs:
|Apply for a mortgage easily||CES|
|Get a good rate||CSAT, NPS|
|Resolve questions or issues efficiently in my preferred channel||FCR, AHT, Number of channel switches|
|Receive approval quickly||CSAT, NPS|
Your customers view each interaction with your organization as a continuous journey as they achieve specific goals, such as a health insurance member enrolling in a chronic care management program. They expect frictionless and connected experiences no matter which channel they choose to engage in next.
Without measuring cross-channel experiences, it’s extremely challenging to uncover customer goals and learn how they go about achieving them, in addition to discovering any friction points they encounter.
But often, measuring customer experience across channels is difficult because of siloed data that lives within countless systems and databases, each owned by different business functions. Overcoming challenges with omnichannel analytics is daunting, but you can start small and expand your scope over time.
Begin by focusing on connecting the touchpoints you own. For example, contact center leaders can attain immediate value by first integrating IVR, chat and call data, before later moving on to add website, mobile and product data.
Some enterprises prioritize investments in analytics and data science teams to integrate omnichannel customer data. Others use solutions like customer journey analytics, which allows analysts to build models and accelerate analysis, but also enables business users to visualize and measure cross-channel customer journeys without coding python or SQL scripts.
Customer feedback and VoC programs are considered a best practice for CX measurement. These programs are valuable, but the way feedback is collected can be improved.
As discussed earlier, metrics like NPS are often measured in aggregate, by segment or channel. Further, these metrics are captured after isolated interactions, which don’t reflect your customers’ entire experience.
Instead of capturing feedback after one interaction, consider surveying your customers once their goal is complete.
For instance, an internet service provider (ISP) can survey customers once their Wi-Fi connectivity is restored, rather than after one phone call with support or after a technician visits. Sometimes one phone call or one visit from a technician doesn’t solve the problem.
This will also help you cut down on survey fatigue, which is rapidly increasing as response rates plummet. In fact, only 9% of consumers will take the time to thoughtfully respond to your VoC surveys.
By altering when and how you collect customer feedback, you can better understand that feedback and draw a direct line from voice of the customer metrics to business outcomes.
If your customer abandons their goal or doesn’t complete your survey, you haven’t measured anything. You need real-time metrics that predict the likelihood each customer will reach their goal and have a positive experience. This is crucial for optimizing CX and business success.
To understand why, let’s go back to the mortgage example.
Submitting an application is an essential step in getting a mortgage. Measuring abandonment and completion rates is a perfect indicator of customer success (getting a mortgage) and business success (acquiring new clients). If you measure these metrics in real time, you’ll know when abandonment rises too high so you can investigate the issue, intervene and help customers submit their applications.
This is an example of how CX measurement enables experiences to be improved in real time using customer journey orchestration. After all, your customers expect you to know when they encounter a problem. And that you’ll fix it quickly or give them an alternative route to reach their goal.
But if you’re unaware of obstacles in your customers paths, you can’t intervene and make things easier. Measuring experiences as they happen is crucial to satisfaction, trust and loyalty.
Further, real-time CX measurement helps you prioritize opportunities for improvement. If you can measure CX in real time, you’ll always know which initiatives will impact experience and business metrics. This way, you won’t spend time optimizing issues that don’t affect as many customers – or don’t affect them as acutely – as another problem.
CX professionals have a wide variety of metrics to choose that represent the health of customer experience.
Let’s take a deeper look at five of the most popular customer experience metrics.
NPS shows the percentage of your customers who would recommend you to others — friends, family or colleagues.
It’s the most well-recognized customer experience metric that there is. It is also the simplest. NPS is typically measured by asking the following question:
How likely are you to recommend [business] to a friend or colleague?
Customers rate your company on a scale of 0–10. Respondents are grouped in the following categories:
To calculate NPS, subtract the percentage of detractors from promoters.
CSAT is the mean or average satisfaction score of customers for a given experience.
It’s typically measured by an automated survey that asks customers to rate an experience such as a product return, a customer care call or a password change through an auto-generated post-interaction survey. The scale typically ranges from Very Satisfied to Not at All Satisfied.
CSAT can be used as an immediate reaction of users’ to a product or service experience. Many enterprises use CSAT as an overall performance indicator. For instance, how satisfied are customers in general?
But CSAT is most useful when measuring customers’ happiness when achieving their specific goals rather than after isolated interactions within a singular channel.
Customer effort score determines the relative effort required by the customer to work through an interaction.
This interaction could be a simple one such as looking for a product or a more difficult one such as resolving a technical issue. It’s usually measured on a defined scale through an automated post-interaction survey.
For instance, you could ask, “How much effort did you have to put in to resolve this issue?” and the responses could vary from Very low effort to Very high effort.
Effort is a good metric to measure whether your efforts to reduce customer experience obstacles are bearing fruit or not. Customers are looking for quick and convenient resolution to problems and resent having to expend a lot of effort to complete a product or service-related task.
4. First-Contact Resolution
Every contact center professional has heard the acronym FCR, but what does it mean? First contact resolution is the ability to resolve customer issues on the first attempt, with no follow-up needed.
FCR is a clear way at looking at a call center interaction through your customers’ eyes. Most people don’t enjoy repeatedly calling companies to address issues. They want their questions answered and issue resolved the first time they reach out.
Many organizations use FCR to measure efficiency and effectiveness. Solving problems the first time that consumers contact your business mitigates support costs. And resolving issues without extra contacts is a sign they’re trained properly and can serve customers effectively.
Most importantly, FCR has a major impact on customer satisfaction and effort, as well as revenue. American consumers will pay 17% more to purchase from a company with a reputation for great service.
Customer service is a critical moment of truth. It plays a major role in how customers perceive your brand and their decision to churn or remain a customer.
To gain an accurate measure of FCR, you need to avoid using arbitrary definitions to determine whether the issue has been resolved, such as no further calls within 48 hours. FCR should be determined after confirming the customer’s issue has been resolved because they’ve completed their journey. Using a mortgage example, this would be that the loan has been approved and the funds have been issued, rather than the customer stopped calling with questions about their application.
5. Customer Lifetime Value
Customer lifetime value (CLV) aims to quantify the total value or worth of a customer over their entire relationship with your organization. As Forrester notes, lifetime value “is gaining traction as customer insights professionals seek to maximize efficiency, demonstrate economic value, and leverage advances in data management for strategic purposes like customer experience improvement.”
Lifetime value is considered the best metric to predict how much money your business can count on from every customer. It’s essential for long-term planning and enables CX leaders to prioritize initiatives that can increase lifetime value for each customer.
There are other metrics that fall under categories but can also impact your customers’ experiences. One example is contact center metrics, such as average handle time (AHT), repeat call rate, and wait or hold times. While these KPIs are operational, long hold times or having to call multiple times to resolve an issue can frustrate customers. And that affects CX metrics like satisfaction and ease.
We’re in an experience economy in which a people-centric, empathetic approach is the only way to create a sustained competitive advantage.
Improving the way you measure customer experience is the key to listening and understanding your customers. And that’s key to building trust and loyalty.
How CX leaders measure customer experience is advancing as new technologies present obstacles and opportunities. It’s time to prioritize your customers and their goals first, then align your department and business KPIs and success metrics to those goals.
By taking a journey-based approach to CX measurement, you can enhance your ability to identify and improve pain points for every customer, achieve desired business outcomes and deliver the frictionless experiences your customers demand.
Read our ebook to learn how to jumpstart your journey measurement in 4 easy steps.
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