There are lots of theories about what influences consumer’s purchasing decisions, including the theory that 95% of purchasing decisions occur in the subconscious. Successful marketers know that to capture new business — and keep customers coming back — they need to appeal to people’s emotions through engagement and ensure customers associate positive feelings with their brands. Satisfied, happy customers are key to business success, and the customer satisfaction (CSAT) score allows you to measure and monitor those sentiments.
What is a CSAT Score?
The CSAT score allows customer experience teams to measure how consumers feel about their brands and monitor changes in perception over time. It is a common key performance indicator (KPI) that businesses across all industries use to keep their customer service and support teams on track.
How is a CSAT Score Calculated?
Measuring customer satisfaction requires collecting data and calculating your CSAT. If you’re using a 5-point scale, divide the total number of people responding with a 4 or 5 by the total number of respondents and multiply by 100.
CSAT Score Formula
(Number of people responding with a 4 or 5 / Total number of people who responded) x 100 = CSAT (represented as a percentage)
Alternatively, you can use a CSAT score calculator to automate the process and reduce the risk of error.
How Can I Measure Customer Satisfaction Score?
Make a strategy for measuring customer satisfaction based on CSAT surveys and monitoring your score as part of your customer experience program. You’ll find that measuring and tracking customer satisfaction scores leads to increased repeat business and brand loyalty.
Using the tips in this blog can help you tailor your strategy, the KPIs you’ll use in addition to the CSAT score, and the best way to measure CSAT for your business, your industry, and your customer base.
What Is Customer Satisfaction?
Because “customer satisfaction” is subjective and can vary from person to person, it may seem hard to measure. However, it is possible to identify and measure indicators of how happy customers are with your business. Satisfaction is closely tied to meeting expectations and preventing disappointment.
Taking a brief look at the science behind satisfaction, our brains release dopamine in anticipation of a “reward,” which in the case of engagement with a business can be completing a purchase, benefitting from a service, or using a product successfully. When you allow the person to get the reward, the customer feels satisfied. Interfere with that process in some way, and you could cause someone to feel disappointed and dissatisfied.
What is CX?
Although you may hear the terms customer satisfaction and customer experience (CX) used interchangeably, they are actually different. CX is what occurs at each touchpoint of a customer’s journey from the customer’s perspective. Multiple factors affect CX. For example, the customer experience can depend on how your employees treat customers or how well they like your products and services. Or, CX may depend on how quickly they can connect with customer support, resolve issues, or find answers to their questions.
Add up the positives and negatives of how well your business met expectations within each experience, along a customer’s journey, and the sum is how satisfied that customer is with your brand. Optimizing CX and customer satisfaction can help build a business; a PwC survey found that 73% of consumers say experience is a primary factor in purchasing decisions.
What is CES?
One factor that impacts customer experiences and customer satisfaction is how easy it is to interact with your business. In the digital age, people have grown accustomed to immediate information, automated processes, and instant gratification. They expect the same from interactions with your business.
You can use an additional KPI, customer effort score (CES), to learn how difficult your customers perceive interactions with your company or products. CES is typically based on answers to a straightforward customer survey, which asks for a rating from 1 for very difficult to 7 for very easy. Then, you add all responses of 5 or greater, divide by the total number of responses, and multiply by 100. This gives you a CES as a percentage.
The goal is to provide easy experiences and achieve a CES of as close to 100% as possible. Scores closer to 0% mean customers perceive doing business with you as difficult. Difficulty negatively impacts customer experiences and customer satisfaction, so the best next step is to pinpoint the root cause and correct it.
CSAT vs. NPS – What Is the Difference?
Although CES specifically gauges the ease or difficulty of customer experiences, there are KPIs that measure overall customer sentiment. Two are customer satisfaction score (CSAT) and Net Promoter Score® (NPS).
Businesses will find that the two KPIs work hand-in-hand to provide a clearer understanding of overall satisfaction, and there’s no need to choose CSAT vs. NPS. Both provide valuable information.
How Does NPS Work?
Net Promoter Score developers found that answering one question is a good indicator of customer satisfaction. The survey asks, “How likely are you to recommend us to a friend, colleague, or family member?”
To get the most accurate view of your brand, you should take a random sample of your customer base from across all stages of the customer lifecycle, not just recent customers or active users, to develop an accurate picture of how your brand is perceived in your market.
You can divide customers who respond into three categories:
- Promoters: Customers who respond 9 or 10. They are so satisfied with your products, services, and support that they will give recommendations and engage in word-of-mouth marketing on behalf of your company.
- Detractors: Customers who respond with a 6 or lower are people who would not recommend your business and may write negative reviews or advise colleagues not to work with you.
- Passives: People who respond with a 7 or 8 are neither promoters nor detractors.
To find the score, find the percentage of detractors by dividing the number of people who responded 6 or lower by the total number of responses and multiplying by 100.
Find the percentage of promoters in a similar manner. Then, subtract the percentage of detractors from the percentage of promoters.
Remember that NPS scores can range from -100 if everyone who responds is a detractor to +100 if everyone who responds is a promoter. That means a score of 0 represents a customer base with an even number of people who are satisfied and enthusiastic about doing business with your company as people who aren’t so much.
NPS Advantages and Disadvantages
One of the biggest advantages of tracking NPS is that you can segment your customer list based on how they respond. This data can help your customer support team and sales associates tailor interactions to improve customers’ experiences and satisfaction. They can focus a little more on detractors to give them extra attention or assistance they need to change their minds. Your team can also give promoters VIP treatment in the hopes their level of satisfaction with your business remains high.
Another advantage of NPS is that it can remove bias that may exist in the way you word questions in other types of surveys. Additionally, NPS is unlikely to be impacted by an isolated event because you are asking a customer for an overall impression. Customers will base their answers on how much they trust your business, rely on your products and services, and will be loyal to it themselves.
Additionally, NPS is a good tool since it’s short and simple. People are more likely to respond with one number to one question than fill out a long customer survey. The average response rate is between 15% and 30%, which is usually statistically high enough for relevant conclusions.
One possible disadvantage of NPS is that it’s never “one and done.” Businesses need to send surveys periodically to build strong relationships and customer satisfaction among their bases.
Also, it may be difficult for a business to determine whether an NPS score is good for their industry or their market. Analysts that have studied NPS across industries have found that benchmarks vary. You can use those benchmarks to see how you compare to competitors — and to set goals for your business.
Why CSAT is Important
Like NPS, CSAT allows you to quantify customer sentiment about your brand. However, it provides specific customer feedback that can help you improve your business and the number of satisfied customers.
When you monitor your CSAT score and respond to the voice of the customer, you can take steps that have a positive impact on your business, including:
Reduce Customer Churn
If your business is in a competitive market, such as financial, banking, Software as a Service (SaaS), or consumer services, your customers have many choices of where to make investments or spend their budget.
A customer satisfaction score can show how likely they are to choose your business again based on their perceptions of particular elements of the customer journey. Moreover, regularly polling customers on their satisfaction can give you time to identify issues and correct them before your customers decide to switch to a competitor.
In addition, you can address customers’ concerns individually. This assures customers that they’re heard and that you care about improving their experiences. It can help you understand and meet that customer’s expectations, increase their satisfaction, and improve customer retention and customer lifetime value (LTV).
Improve Customer Experience
When you analyze results from a CSAT survey, you may see recurring themes among the responses. Customer support may be waning overall. Or when a specific employee is involved, scores are low, while customers may provide positive reactions to the rest of the team.
Your CSAT score related to different elements of the customer journey will reveal weaknesses in your processes so you can adapt them to provide better CX. Similarly, CSAT scores will show where you’re knocking it out of the park so you can continue doing what works well.
Inspire Brand Loyalty
The more you learn about your customers by asking targeted CSAT score questions, the more you will learn about how to keep your customers satisfied. By meeting their expectations and creating delightful customer experiences, you will encourage them to continue to do business with your company.
The effort you put into inspiring loyalty will benefit your company with higher customer LTV. A 5% increase in customer retention can increase revenues by 25% to 95%.
CSAT – Advantages and Disadvantages
Collecting customer feedback with CSAT surveys has several advantages over other methods.
First, you can craft questions to collect customer insights on specific processes or touchpoints on the customer journey, or to gain honest feedback on your business overall. It’s a flexible method that gives you control over the types of survey data you’ll collect and analyze.
You can also format surveys to suit your customer base, for example, allowing respondents to use a number scale, stars, or even emojis.
CSAT surveys can be quick, to the point, easy for customers to answer, and easy for you to interpret.
CSAT Pitfalls to Avoid
To enjoy the benefits of building a program centered on the CSAT score, you need to be aware of its disadvantages and advantages.
Remember, they only give you an indication of customer sentiment in the short term. The feedback is related to how they feel after a certain type of interaction or on a certain day. Additionally, the way you word questions can skew results. For example, if you ask, “What would you improve if you could?” the customer may respond based on what they think is possible rather than what they’d really want to see.
You also need to be aware of cultural bias in the questions you ask and in how people from different demographics could respond. You may encounter people who are afraid to provide honest feedback, concerned that it will harm your business relationship. One way to address this issue is to allow customers to submit feedback anonymously.
Lastly, you need to be realistic in how you interpret results. A good CSAT score doesn’t necessarily equal customer loyalty or an increase in LTV. Take responses at face value or use them in conjunction with NPS or other schemes to create a full picture of customer sentiment.
When Should I Send a CSAT Survey?
Because CSAT measures customer satisfaction in the short term, it’s important to time the surveys so you capture how they’re feeling right after customer interactions or at specific touchpoints.
When you consider all the potential events that could trigger a survey, you’ll find that you need to narrow it down to those that will provide you with the most valuable information. CSAT surveys related to these events can be the most beneficial to your business:
Before Renewal or Repurchase
If your customers subscribe to services or software, or if they restock products periodically, sending a CSAT survey prior to the time when they re-up can help you gauge their level of satisfaction. The most significant benefit of a survey at this time is cluing you in if they aren’t happy with certain aspects of your products or your business. By sending the survey before the renewal date, you have time to intervene and save the account.
When Introducing New Products or Features
When you launch a new product or feature, it’s smart to see how customers view its value, even if you have had successful pilots. A CSAT survey with a few questions about the new release will assure you that the changes you’ve made are positive and users are adopting them.
If the services or software you provide require an onboarding process to help customers learn how to use them and get value from them, a survey at the end of the process will be valuable.
This feedback can benefit your business in two ways. First, you can work through any issues the client still has after onboarding so they have a better chance of success with your product. And second, it can help you improve your onboarding process for all your clients.
After a Purchase
Sending a CSAT survey to clients after a purchase can help you gauge the customer’s impression of the sales process and give the customer support team a baseline for the customer’s initial level of satisfaction.
After a Customer Support Interaction
CSAT surveys are a go-to tool for customer support teams. Asking the customer to take a brief survey after a support call, or other support interaction will help you understand how effectively your team handled the issue. You can ask questions that provide feedback on the service the customer support agent provided and whether they feel their issue is resolved. You can also ask about the process itself — wait times, convenience, and ease of interaction. With this data, you can improve processes for all customers.
After a Webinar
If you hold interactive events for your customers or prospects, a survey will help you gauge how much value participants felt it provided, whether it increased their interest in your products or services, and whether it did its job of moving prospects down the sales funnel.
Types of CSAT Survey Questions
There are different approaches to crafting CSAT survey questions. Depending on your brand and the types of insights you want to collect, you’ll choose from various question types, including:
Semantic Differential Questions
These questions allow respondents to answer on a 5- or 7-point scale about how well a statement represents how they feel about the service they’ve received, your product, or some other aspect of your business.
Likert Scale Questions
These questions also use a 5- to 7-point scale for responses but ask the respondent to choose low numbers for negative feedback, high numbers for positive feedback, and the middle number if they are neutral.
Binary Scale Questions
As the name implies, these questions give the respondents the choice of answering yes or no, or two other possible answers, like feeling “positive” or “negative.” This is the best option if you need a definite answer, for example, whether they’ll use the new product feature you’ve introduced.
Rating Scale Questions
Much like a “five-star” movie review rating scale, these questions ask where the customer would rank your product, service, support, or new features.
Alternative CSAT Rating Scales
Businesses have a great deal of latitude with the scales they use with CSAT surveys. Although the 5-point scale is perhaps the most common, alternative customer satisfaction rating scales include:
- 3-point scale
If space on an app screen or other user interface is limited, you may want to limit the scale to three responses — basically, negative, neutral, or positive.
- 7-point scale
This scale can provide more detailed information than a 5-point scale, allowing you to see if people are more neutral or more convicted about their answers.
- 10-point scale
Use this scheme if you require granular information and want to gauge customer satisfaction based on those who answer 9 or 10.
- 11-point scale
This scale adds “0” to the beginning of the scale to help customers communicate their ratings more precisely.
What is a Good CSAT Score?
CSAT scores can range from 0% to 100%, so scores closest to 100 are preferable. However, it’s unlikely that every one of your customers will express total satisfaction with your company.
To interpret scores, consider that the number represents how many customers out of 100 are satisfied with your brand.
CSAT Industry Benchmarks
Average CSAT score ranges vary by industry. The American Customer Satisfaction Index (ACSI) provides benchmarks for sectors, including:
- Specialty Retailers: 77
- Online Retailers: 77
- Municipal Energy Utilities: 73
- Computer Software: 77
- Household Appliance and Electronic Manufacturers: 78
- Financial Advisors: 78
- Banks: 78
- Search Engines and Information: 75
Tips on How to Improve a Poor CSAT Score
Once you’ve surveyed customers and calculated your score, you need to consider whether you need to take steps to improve customer satisfaction.
One step is to compare how CSAT scores vary across different customer service channels. For example, you may have excellent scores if you only factor in customer service supported by an AI-powered chatbot, but scores are low for phone-only support.
Also, look at categories of negative feedback. Do they all seem to relate to slow response time? Products that are difficult to use? Customer support staff that lack knowledge or empathy? Target those areas for improvement.
Also, commit to improving experiences for customers who provided negative feedback. Include survey results to their account in your customer support platform so agents can tailor their interactions with that customer based on the input they provided. If negative feedback is related to your products, strengthen your quality assurance program.
You may find that there are some easy fixes. For example, if customers find it difficult to use the self-service platform you’ve implemented, try a different configuration – or an intelligent platform that allows customers to ask for help conversationally.
Take Immediate Action on Feedback
One of the most important steps is responding immediately to feedback. If a customer has taken the time to share insights, show them the courtesy of a timely answer.
Your team needs to assign a person responsible for this task, train that manager or employee in de-escalation, and monitor results. If intervention isn’t moving the needle on overall customer satisfaction, adapt the plan until you find the right people and the right approach to make a difference.
Establish Strategic Goals for Your CSAT Metrics
Quantifying customer satisfaction with the CSAT KPI gives you the ability to understand how your customers perceive your brand today. However, if you perform surveys regularly, you can monitor progress.
Setting goals, establishing incentives, and working toward them as a team will enhance your ability to improve that metric. However, more importantly, it improves customer satisfaction, CX, loyalty, and customer lifetime value.
Conclusion: Equip Your Team with Tools that Enhance Customer Satisfaction
Collecting feedback and calculating your CSAT score will give you greater visibility into customer satisfaction and the quality of specific customer experiences. But sending surveys and analyzing responses can take time and resources away from customer support or other core responsibilities.
A customer support platform with a survey feature will make learning more about your customers’ feelings toward your brand an easier and more efficient process. Whatever tools you choose, your overall strategy for collecting customer feedback and acting on the results will drive the sentiment behind your brand.