How to Measure Customer Experience — Strategy, Metrics, and Best Practices

When focusing your CX efforts on delighting customers it is easy to forget that customers care way more about getting a consistently good experience than about a few rare moments of delight.

But how do you provide constantly good experiences when the number of customer interactions with your business rapidly increases, and your CX team is already at capacity?

Our approach is to measure customer experience across many different touchpoints to find the root cause of the problem and eliminate it, instead of the traditional satisfaction survey sent after the customer had to spend an hour on hold to have a two-minute conversation with a customer service rep. How to do it effectively? Read on to find out.

How to drive action based on CX KPIs

Gathering feedback from customers is one thing. Gathering feedback in a way that gives you actionable insights is another. Companies collect more and more data, but it often lets you know there is a problem, but not where to even begin looking for the cause. So how do you start gathering customer data for impact?

Find touchpoints across the entire customer journey

Start from making sure you know your customer’s journey. Use journey mapping to figure out specific steps your customers need to take to achieve their goals (like buying a TV on your site or making a warranty claim).

What’s good about this method, is that it helps you clearly see not only the last customer interaction with your company but all the steps leading up to it. It’s very important because often when measuring customer experience we focus on the last interaction (for example we ask customers to rate the conversation with a support agent) but we forgot what led to the customer having to contact support in the first place.

Let’s look at a real example:

1. Mark receives an email with an invoice for a business purchase he made. When he opens the PDF, he sees that some data on the invoice is incorrect.
2. Mark wants to get a correct invoice, so he looks for information about incorrect invoices on the company website.
3. He can’t find any specific information so he decides to contact customer service. He looks for information about how to do it and manages to find an email address.
4. Mark sends an email asking to fix the invoice, after two days he gets an email back with a correct document.
5. A few days later Mark receives an email asking him to rate the customer service. The answer he got from the customer service rep was nice and apologetic, but he had to wait two days not knowing if they had even received his message. He’s also wondering why he couldn’t just fill out a request form on the website. He emails back saying that he is unsatisfied and as a cause picks: long wait time.

The company had received many answers similar to Mark’s in their customer satisfaction survey so they increased the number of agents, limiting reply time to a few hours. In the next survey customers no longer say the wait time is too long, but the churn rate keeps increasing.

Why? Because the company only asked for satisfaction from the very last interaction and is not aware that customers actually had quite a few frustrating moments beforehand. And as long as those problems are not fixed even the best customer reps won’t do much.

So how do you get to the root cause of a problem, let’s say of an incorrect invoice being sent to a customer? Let’s take a closer look:

Get quantitative data about the customers who contacted you about a problem with invoices. Your helpdesk solution should have a feature that lets agents tag tickets based on the subject. If the number is high, it in itself is an indicator that you should take a better look at this process holistically and what might be causing a high number of tickets — maybe the invoice form needs to be redesigned.

To further explore what exactly is wrong, send the customers who had problems with the invoice a survey asking them about how difficult it was to achieve their goal and if it was difficult what made it this way.
You might find out that some of the users prefer self-service and would rather fill out a form or talk to a virtual agent than talking to humans. Some would like to talk to a human but don’t want to wait for a long time.

What’s great about this approach is that if you fix the root cause, you not only make your customers happy (which means more of them will return = revenue boost) but also it means that you significantly reduce customer service costs.

As you can see there are quite a few things that can go wrong with just one customer path, but there are hundreds of different paths users take to achieve their goals. That’s why you need a strategic approach to CX measurement.

To do it, you need to build a system that helps you gather data from different touchpoints. Create a dashboard that includes data from different data sources and make it easily accessible to both leaders and lower-level employees.

Choose the right CX metric to measure

When measuring CX you can choose and combine different types of metrics. Some of them are transactional, meaning that they are best for measuring specific touchpoints like CSAT. Some are best for measuring overall experience like NPS, some are great for both like CES. There are also many metrics that you don’t need to ask the customers directly about. You can collect them using customer behavior analytics (like customer retention) or internal KPI like case resolution time.

Customer satisfaction score (CSAT) — indicates the customer service and product quality and is generally expressed with “How would you rate your overall satisfaction with the product/service you received?”. It’s often used with specific interaction not as an overall experience metric as it has a weaker link with customer loyalty than NPS or CES.

Net promoter score (NPS) — indicates how likely customers are to recommend your brand to others. And depending on the answers, customers fall into three categories: promoters — loyal and enthusiastic customers, passives — satisfied with your service but not happy enough to recommend your business, detractors — unhappy customers who are unlikely to return, and may even discourage others from buying from you.

Customer effort score (CES) — measures the overall easiness of customer interactions with a product (e.g., your online store) or service (finding out where a late parcel is). In other words, how easy it is for customers to achieve their goals. It’s a strong indicator of customer loyalty (the higher the effort, the more likely the customer is to become disloyal).

Customer engagement — indicates how often customers interact with your brand whether through social media, email, or by clicking on your website.

Customer retention — how often do customers repurchase from your site or how long they use your service.

Churn rate — the mirror opposite of customer retention, measure how many customers stopped using your product or service over a certain period of time.

Customer Lifetime Value — indicates how much a business can reasonably expect from a single customer over their lifetime. Customer lifetime value helps brands see what customer segments are the most valuable to the company considering the cost of investments in marketing, acquisition, and customer experience.

Task completion — measures whether customer managed to achieve their goals, if they got to buy the product they wanted or find an answer they were looking for.
Task completion helps divide successful visits from unsuccessful visits and is measured with a simple yes/no survey question.

First response rate — the time a customer needs to wait for the first reply from a company after they contact them, whether by phone, email, or live chat.

Case resolution time — how long does it take on average from the first customer contact to case resolution.

Contact volume by channel — tracks how many issues come in through various channels like phone, email, live chat or text. This metric helps companies provide support via the channels most preferred by customers and assists in allocating resources to the right channels.

Social listening — indicates how often people are talking about you online and what they’re saying. Customers often have opinions about brands that they share only with their family and friends, not the company itself. Social listening tracks the number of mentions on various channels and if they are positive or negative.

Referral rate — NPS tracks how willing customers are to refer family and friends to a brand, but referral rate measures if they actually do it.

Measuring customer experience can be tricky and simply overwhelming if you don’t take a strategic approach. But getting rid of the obstacles that stop people from buying your product or service leads you to long-term, cost-effective solutions instead of costly short-term fixes.

Try conversational AI to level up customer experience

If you want to see how virtual agents can support your business, book our experts here for a demo.

Looking for a more specific solution? Check out these virtual agent use cases:

• Virtual agents for lead generation
• Virtual agents in travel and hospitality
• Virtual agents in healthcare