If you can’t measure it, you can’t improve it !
In recent years, much debate exists around the types and the amount of performance indicators to ensure a satisfying level of customer relation management. The truth is that there is no magic number. A company, according to their culture, must identify indicators that fit best with its strategy. Indicators that are not in harmony with our management philosophy will create dissatisfaction or even confusion within your organization: and as they say, a dissatisfied employee cannot make a satisfied customer.
Are you measuring your customer experience ?
Our November blog post focused on mapping the customer journey within the company. It allowed us to demystify the various stages and points of contact between the customer and the company. We also shared information about the concept of personas that allows us to understand the ways of our different customer segments.
Indeed, considering that companies today are now offering several products from several points of contact, measuring the customer experience may sound complex, but it doesn’t have to be!
Why measure the customer experience ?
Measuring the customer experience is increasingly used by organizations that put customers at the center of their strategy. This allows companies to have a vision, strategies and objectives focused on customer needs. While there are several indicators to measure customer satisfaction, we present you the ones that represent the “voice of the customer”.
In this publication, we have chosen to present 3 measures that represent important trends in the field of customer experience, either by their novelty or their dominant presence within companies.
What are those measures ?
- First Contact Resolution / FCR
- Net promoter Score / NPS
- Customer Service Effort / CES
Now let’s look at them more closely
First contact resolution
The first contact resolution is a popular indicator, very present in the market, which has long been associated as the number 1 indicator for measuring the quality and effectiveness of customer service delivery. Indeed, 90% of companies measure it (study of Ascent Group) and best practices indicate that your FCR index is expected to be 86% (SQM). This indicator allows you to save operational costs by avoiding multiple contacts for the same customer request. It also allows you to maximize your customers’ satisfaction, because nothing is more frustrating than contacting a business and not being able to resolve the situation quickly and in only one call.
Besides allowing you to cut your costs, monitoring and analysing the results enables you to question your business rules, your service delivery process as well as the identification of training opportunities to improve satisfaction of your customers.
FCR is a good measure, however, it has its limitation:
- Some requests require multiple contacts because of the complexity of the transaction;
- The resolution at first contact does not always account for interactions across all service points in a multichannel environment (i.e. the client may have done research on your website and not finding the information had to contact your customer service center);
- Customer management systems do not always adequately track and measure the first contact resolution
Net promoter score
The NPS is a tool to measure the loyalty that exists between a provider and a consumer. It indicates the willingness of customers to recommend products or brands.
This new indicator has established itself in the US market, notably through a SatMetrix barometer, to compare the scores of companies that subscribe to it. It allows to measure on a scale of 1 to 10 the number or percentage of customers that are willing to recommend or not a brand or product.
How likely would you recommend our company/product/service to a friend or colleague ?
Customers giving a score of 9 or 10 are called promoters, and are considered likely to exhibit value-creating behaviors, such as buying more, remaining customers for longer, and making more positive referrals to other potential customers. Those who respond with a score of 1 to 6 are labeled detractors, and they are believed to be less likely to exhibit the value-creating behaviors. Responses of 7 and 8 are labeled passives.
Net Promoter Score is calculated by subtracting the percentage of customers who are Detractors from the percentage of customers who are Promoters
The NPS can vary between -100% (all are detractors) or + 100% (all are promoters). Best practices indicate that an NPS of + 50% is excellent (Harvard Business Review) ! This is a good indicator to measure client loyalty, but it is not the best to understand customer satisfaction at a transactional level.
For example, a customer who had to put a lot of effort in interactions may still recommend a company to a friend because he likes the product. This hides an opportunity for improvement. On the other hand, a customer who has put little effort into his interactions can give a poor score because he does not like the product.
Customer Effort Score
CES is an indicator that appeared in 2010 following a publication of the Harvard Business Review; it states that the loyalty of a customer has more to do with the minimal efforts from the latter to be satisfied rather than by the fact that the organization exceeded his initial expectations. The Customer Effort Score seeks to measure whether the basic expectations have been met. It allows to quickly identify customers at risk of defecting.
Studies show that when customers have to spend more effort than they expect, they leave. So high effort equals low customer loyalty. The CES helps you monitor this.
There is one question that is part of a survey following a transaction (IVR, pop-up survey on the Web, or in an electronic survey) which allows you to measure CES:
“How much effort did you personally have to put forth to get your request addressed?”
The question is rated on a scale of 1 to 5, where 1 means “a low level of effort” and 5 means “a high level of effort.”
CES is a good measure for assessing the micro-customer experience and it enables companies to identify opportunities for improvement. Studies have shown that 94% of customers who put little effort for their request to be addressed will continue to do business with companies.
This indicator also has its limits. It does not take into account the emotional dimension of the customer relationship. In addition, this indicator is rather focused on the service delivery to the customers. Defining measures and the interpretation of the results can be inadequate. If it is not defined and implemented correctly, it will impact the results. Since CES is an inverted measure, the mix of questions and measures in one survey can impact the results.
For example, 2 questions in the same survey, on a scale of 1 (lowest) to 5 (maximum)
- What is your level of satisfaction about the product you bought. The score 5 equals a good result – maximum satisfaction.
- How much effort did it take you to get satisfaction. The score 5 equals a bad result – maximum effort.
The wording of the question is important because of its impact on the interpretation of the word ‘’effort’’ by the customer. This has an important impact on the quality of the results
Customer experience is very complex; analysis and interpretation of the results cannot be based on a single measure. Although they are imperfect, all measures have their objectives and they can be used to assess the customer experience. However, they must be complementary and should certainly not be compared.
Customer expectations will continue to increase. Today it is well known that the experience between a client and his company will make the difference. Indeed, customers are seeking an effortless experience and a new performance measure is slowly emerging : Zero Contact Resolution (ZCR). The premise of this indicator is that the company must “get it right the first time”. The company must make the maximum effort to resolve a situation without the customer noticing. The subjacent concept to the ZCR is the principle of proactive customer service that we covered in our blog post Mapping the customer journey: a travel through customer experience enhancements.
Establishing a customer experience measurement program will allow you to aim high, to have a powerful tool for growth and for you to differentiate yourself from your competitors. Therefore it is important to identify the right measures, invest in the right tools and best practices surrounding the management of the customer experience .
You want to implement or optimize customer experience measures and practices? You would like to have a dashboard to have an overview of the results ? With our experience and our best practice knowledge, SSA Solutions can assist you in this process.