Businesses all over the world are starting to figure out that happy customers grow businesses – and that customer experience (CX) is key to making those customers happy. But for many, the challenge is how to measure that customer experience. After all, if you can’t measure it, how do you know if you’re improving it? That’s why having some key customer experience metrics in place is so important. Using key metrics both to benchmark yourself against past performance and against your competitors is one of the only ways you can track improvements and know what’s working. So what CX metrics should you be considering?
Net Promoter Score
The king of CX measures, the Net Promoter Score (NPS), is a customer experience and satisfaction metric widely adopted around the world that is calculated by asking one simple question – “how likely are you to recommend us to your family and friends?”. By calculating the scores that your customers give, NPS can show you where you sit on a scale between -100 and +100.
NPS by itself isn’t a perfect metric, but it means you’re able to compare yourself to others in your industry and category. Most importantly, it offers relativity as to how you’re performing, allowing you to compare yourself since you started collecting data – last week, last month and last year, if you can – and know whether the changes you’re making are actually helping.
What’s more, if you measure NPS as part of a voice of customer programme that also asks customers why they gave that answer, you’ll start to gain real insights into why your customers are happy or unhappy – and get ideas for how to improve on what you’re doing. NPS has been proven to have a direct correlation with business growth – because the higher your NPS, the happier your customers are. Improve your NPS score, and you improve your business.
Customer Loyalty Data
If you’ve got a loyalty programme, you should be tracking the data that comes from it – but even if you don’t, tracking your customer loyalty is key to understanding whether customers are actually happy or not. Aim to track how often customers are coming back and how much they’re spending. You should be able to understand who your best customers are, what motivates them, and how you can convert your other customers into more committed spenders.
Lifetime Value of a Customer
You’d be surprised at how many businesses don’t know the lifetime value of a customer – they may know the average basket value, or their total spends; they may know the year total, but not how many years a customer will stay with them. But these metrics are how you understand what a customer is really worth to your business. Sure, they might only buy one coffee for $5 the first time they buy from you. But now consider if they’re buying that coffee every day for five years. Their lifetime value is nearly $10,000 – and worth far more than just ‘one coffee’. If your product or service is higher value, that lifetime value could be up in the tens or hundreds of thousands.
Seeing how much your customers are really worth is vital to helping your team understand just why every time that customer needs an exceptional customer experience every time they engage with your business.
The best time to establish CX metrics was five years ago but the second-best time is right now. The more data you have, the better you can understand how you stack up and what you need to improve to make your customers happier and help your business grow. So what will you be measuring in your business?
Are you ready to take the first step into customer experience measurement? Try our customer lifetime value calculator and see what you stand to gain through improved customer experience.