When it comes to measuring customer satisfaction, the most popular metrics used by businesses are CSAT (Customer Satisfaction Score) and NPS (Net Promoter Score).
Both have their own strengths and weaknesses. To determine the customer success metric relevant to your business, you need to look at how each aligns with your objectives.
If you want to improve the customer experience and increase customer loyalty, NPS might be the best choice. But if you’d like to measure the effectiveness of a specific customer interaction, CSAT is more relevant. One metric should not exclude the other.
CSAT and NPS are very effective when used together. For example, our support team has built an automated workflow to measure overall customer satisfaction with NPS surveys. They also use CSAT to evaluate specific interactions (e.g., after they close a support ticket, evaluating a new product feature, etc.)
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Both CSAT and NPS are indexes that measure customer satisfaction, but they have different formulas and interpretations.
CSAT measures customer satisfaction by asking clients to rate their satisfaction level on various scales (ex.: 1-5, 1-10, etc.). CSAT measures customer satisfaction at a specific moment and doesn’t include predictions or evolutionary trends.
With Touchpoint, you can also measure CSAT on a two-level rating scale. A two-level rating scale offers customers the option to choose between “satisfied” or “not satisfied.”
Albeit less informative, the two-level rating scale gives a basic understanding of customer satisfaction, and it can be followed up by an open-ended question. Two-level rating scales are excellent for gathering clear answers about very specific aspects of the customer experience.
NPS measures customer loyalty by assessing how likely clients are to recommend a product or service to a friend or colleague on a certain scale (usually ranging from 0 to 10). It’s a forward-looking metric that measures how likely your customers are to engage with your brand in the future.
Summing up, CSAT is a measure of how satisfied customers are with their experience with your product, while NPS is a measure of how likely they are to recommend your company’s products or services to people they know.
The best way to provide continuous customer satisfaction is to keep track of your customers’ needs and expectations. Let’s see how CSAT helps you achieve that and how you can correctly assess it:
CSAT is a metric that determines how satisfied customers are with a company’s products or services. It is calculated by surveying customers and asking them to rate their level of satisfaction on a scale from 1 to 10.
Other types of scales include a 1-5 ranking or even use open-ended questions to measure client satisfaction levels. Companies use CSAT to measure customer satisfaction and identify areas for improvement.
To calculate your company’s CSAT, you need to divide the number of satisfied customers by the total number of responses you received and multiply the result by 100.
Another way to calculate your CSAT is to express the number of satisfied customers as a percentage. For example, if a company surveyed 100 customers and 80 of them responded with a score of 8 or higher, the company’s CSAT rating is 80%.
To accurately measure changes in customer satisfaction, decide on a consistent method for calculating your CSAT over time.
There are several ways you can use your company’s CSAT to improve your bottom line:
Here are the most effective ways to improve your CSAT:
Like any metric, CSAT is not infallible. Here are the main pros and cons of using it to assess customer satisfaction levels:
The Net Promoter Score offers actionable insights into how to build the best possible customer experience. Let’s see how you can use it to grow your business:
NPS is a customer loyalty metric that predicts business growth and measures the willingness of customers to recommend a company’s products or services to others.
It is based on single-question surveys that ask customers to state how likely they are to recommend a company on a scale of 0 – 10, with 10 being the most likely.
You can easily calculate your company’s NPS by subtracting the percentage of Detractors from the percentage of Promoters. A positive NPS indicates that more customers are Promoters than Detractors, while a negative NPS indicates the opposite.
To use NPS, you survey a group of customers and ask them to rate their likelihood of recommending the product or service on a scale of 0-10. Respondents are categorized as “Promoters” (9-10), “Passives” (7-8), or “Detractors” (0-6).
Make better business decisions and boost your ROI by following these steps:
There are multiple ways to improve your company’s NPS:
These are the main advantages and disadvantages of using NPS to assess and improve customer satisfaction levels:
In the end, it’s not really a matter of CSAT vs. NPS, but a matter of CSAT and NPS working together. If you’re looking to find out which product features are of interest to your clients and where to invest more cash flow for R&D, CSAT is the metric to check out. If you want to get an overview of your business as a whole, NPS is better.
Another difference between the two is their versatility: NPS is usually limited to single-question surveys, while CSAT includes different types of questions.
You can include a limited number of open-ended questions in an NPS survey, but this can be more time-consuming and may lead to lower response rates. It will, however, offer valuable insights into customer satisfaction and areas for improvement.
Either way, both metrics will offer relevant insight into customer satisfaction levels and how you can improve on them. Ideally, a company should look into both (and consider other metrics, as well) when deciding the next steps it needs to take to grow its business.
Raluca Mocanu is a copywriter at Touchpoint and began her content writing journey in 2016. She loves traveling, reading, on-stage drama and recently discovered a deep interest in psychology.
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