Customer service is one of the most important parts of any company, but many of these businesses fail to measure their performance correctly. They overlook some or all of the key performance indicators (KPI) that can be used to measure how the company is doing and where it needs to improve. The following KPI are considered vital to tracking customer service performance.
Net Promoter Score
The Net Promoter Score or NPS measures customer referrals. It looks at how likely it is that a previous customer will become a promoter of a business. For most, this is measured simply by asking a customer if they are likely to recommend a business to friends and family. Those who respond with a 9 or a 10 on a scale of 0-10 are classified as promoters, while anyone who responds with a 6 or less is considered a detractor and could actually damage your company’s reputation.
Customer Satisfaction Score
The Customer Satisfaction Score (CSAT) is often the single number businesses look at. While it is an important measurement of how satisfied customers are with a business, it’s not the only number companies need to be concerned with. What the CSAT does provide, though, is an important look at how customers see a business. This is often done through a simple feedback process. Customers rate their transaction from one to five stars, with the more stars indicating a more positive experience. It may seem like a very simplified way of measuring customer satisfaction, but it is useful.
First Response Time
First response time or FRT gives businesses an important look at how quickly they respond to customer needs. Companies that offer low FRT are often seen in a more positive light, one study found, even if those companies have worse scores in other areas. The study went on to show that customers appreciate companies that respond quickly, even if that response is not enough to fully resolve the issue. Something as simple as an automated note stating that a representative is investigating the issue is often enough to satisfy customers.
For most companies, it’s not enough to have a steady stream of new customers. The business must also retain a large percentage of these customers. Measuring customer retention is vital to the bottom line because experts estimate it can cost anywhere from five to 25 times the cost to bring in new customers than it takes to retain current ones. Measuring retention and comparing that information with customer satisfaction can show a direct correlation and help leaders begin determining why the company is losing customers.
Finally, many business leaders do not consider employee engagement when measuring customer service. However, it is an important piece of the puzzle due to the fact that employees can serve as promoters or detractors. Employee satisfaction is important, too. Dissatisfied employees are likely to seek employment elsewhere, leading to a high turnover rate. This requires the business to dedicate more resources to recruitment and training.
By measuring these five KPI and looking at them both individually and as a whole, companies will be able to improve their overall customer service and, in turn, grow their customer base.