How do you measure the customer experience
Five starting points for measuring customer experience
The area of customer experience management is on the advance - and there is no end in sight to the trend. When measuring success, it comes down to a consolidated view of the entire company. There are five categories to consider.
Customer experience also requires success controlling.
More than 5,000 companies worldwide have already hired their own customer experience (CX) executives, almost half of whom report to the CEO. This shows that customer experience has an impact on business results and must be measured accordingly.
Most large companies with $ 1 billion or more in revenue have more than 50 CX metrics - some as many as 200 - that are managed by different people in different parts of the company.
Customer retention or loyalty metrics are often the responsibility of marketing, while customer service is responsible for the metrics for solving problems on the first call. Finance tracks how many repeat orders are coming in, and supply chain executives are measured by how on time products arrive, among other things.
Five starting points for correctly measuring customer experience
CX metrics have several uses. They can be used to justify investments and see if there has been any improvement. They help to set goals and targets for future improvements and act as an early warning system if something is not working.
Although the number of metrics used is large, most of them fall into one of the following five categories:
- Customer satisfaction
- Customer loyalty and customer churn
- Advocacy, Reputation and Brand
- Quality and Operations
- Employee engagement
1. Customer satisfaction
The starting point for most businesses. Customer satisfaction is the most traditional metric today. It can either be measured explicitly through surveys or implicitly using metrics such as product ratings, up-to-dateness of delivery statistics or mystery shopping.
2. Customer loyalty and customer churn
These key figures can be retrospective, such as the average length of stay, or predictive, such as the probability that a customer will also remain a customer. Examples include purchase frequency, multi-channel usage, participation in loyalty programs, average order size, reorders, and response rates.
3. Advocacy, reputation and brand
These metrics determine the level at which customers would be willing to recommend or support the product or organization. Price sensitivity, sentiment values in social media, trustworthiness and participation in events are good examples.
4. Quality and Operations
This is the most underrated block of metrics. Because if a product or service does not meet the requirements, the customer experience is always bad - regardless of what measures are taken to correct the problem.
5. Employee engagement
This fifth set of metrics is only found in about 10 percent of the CX initiatives. A Gartner survey found that employee engagement is a key factor in implementing CX improvements. 86 percent of the companies even rate employee engagement as being equivalent to or more effective than other CX measures.
What does customer satisfaction mean to me - and how do I measure it?
Companies dealing with CX management need to first define what CX means to the company and then decide how it will be measured. Measuring customer satisfaction can have several objectives, depending on the maturity of the company. For example, the goal could be to move from a “metric anarchy” in which each team or department measures in isolation to a state in which all measurements are used in their entirety to increase customer satisfaction.
Organizations should avoid focusing on just one top-level CX metric. It is better to consolidate all relevant metrics in a CX dashboard and create a hierarchy. It is also possible to have an index that covers as many aspects as possible, such as commitment, quality, satisfaction and loyalty of employees. This dashboard is then shared across departments.
For example, the repair and maintenance staff in a field service department can see the average waiting time for customers in the contact center and prepare for irritated customers in the event of long waiting times.
CX executives need to keep track of things
While executives mostly prefer to use just a metric or two to summarize the entire customer experience, this approach doesn't show what to focus on to make change happen. Therefore, they need to review all of the CX metrics across the organization - not just those tracked in the marketing and customer service departments - and identify how each metric is calculated, who is tracking it, and who is responsible for improving it.
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