Every company wants to grow. The easiest way to grow is to keep your existing customers. To retain customers, you need to make them happy. Happy customers turn into long-term and profitable loyalists.
How do companies actually know how happy their customers are with their products, services and experiences? They measure CSAT – or Customer Satisfaction.
Throughout the entire customer lifecycle, there are many moments that add up to a person’s relationship with and feelings towards a brand. From in-store and online shopping experiences to customer care interactions and satisfaction with onboarding or learning to use a product itself, every one of these standalone touch points are important.
That’s why customer experience and support professionals are hyper-focused on customer satisfaction, or CSAT. CSAT is a metric that measures how well your company is delivering against your customers’ expectations in these independent moments.
In this post, we will dive into everything you have ever wanted to know about CSAT scores. Jump to specific sections or scroll down to read the entire post.
- What is CSAT?
- Why CSAT matters so much
- How do you calculate and measure CSAT?
- How do you use CSAT scores
- How AI can Improve CSAT
CSAT is the most popular and straightforward way to measure customer satisfaction. It’s a metric that measures sentiment towards your product, service or a specific interaction.
Companies often take a pulse on CSAT after key milestones in the customer lifecycle such as first purchase, prior to renewal or following customer support interactions.
CSAT differs from Net Promoter Score (NPS), another popular metric. NPS measures loyalty and the probability that someone will buy again and recommend your company to other people.
So what drives satisfaction?
People are satisfied when their expectations are met. Like many things, expectations are fluid and change based on situational context and lifecycle. For example, if you spring for a first class ticket on a flight, you are going to expect more personal and proactive service from flight attendants. When you purchase a basic economy seat, you expect attendants to simply ask what you need during their food and drink service. In Economy, there’s no expectation for a glass of champagne before takeoff.
Circumstances change expectations. When measuring CSAT, it’s important to understand the different circumstances of your individual customers to glean actionable insights.
Customer retention is fundamental to a thriving business.
It’s cheaper to keep your current customers than attract new ones. Studies report that 70% of companies say this is true.
CSAT can provide insight into where and when your company is at risk of losing customers and where lie opportunities to optimize experiences to keep customers satisfied. If used regularly, CSAT gives businesses a pulse for how your company is performing. Of course you need to look at and measure the entire journey, not solely flashpoints along the way. However, CSAT can help you realize where your processes are working and where you need to make changes.
Think about this with customer service. In the last year, 78% of U.S. consumers have stopped doing business with at least 1 company or scrapped a planned purchase based on poor customer service – and 31% reported doing this multiple times. One instance of poor support can lead to immediate customer attrition. Understanding what makes people unsatisfied with customer support can identify where more training needs to be done, where there’s an opportunity to be proactive or where processes need to change.
A person’s short-term happiness or unhappiness with your company following an interaction is indicative of future spend and lifetime value.
CSAT is often measured through a brief survey asking people how satisfied they are with a recent experience. This can be an email, chat or phone follow-up question or survey. It typically is done immediately or within a short time after an interaction when it’s top of mind for a person.
The question often looks like the below:
How satisfied are you with your recent purchase / support interaction / service?
- Extremely Satisfied
- Somewhat Satisfied
- Not Satisfied
- Very Dissatisfied
On a scale of 1-5, how satisfied are you with your recent recent purchase / support interaction / service?
- <Very Unsatisfied> 1 2 3 4 5 <Very Satisfied>
Companies will often leave a place for people to add specifics into why they scored one way or the other. This can provide invaluable insight into things that can be improved or adopted more broadly.
To calculate your CSAT, take the number of positive responses (i.e. Extremely and Somewhat Satisfied) and divide by the total number of responses. Then, multiply by 100.
For example, say you gather data from 200 customers. If 160 customers scored satisfaction a 4 or a 5, here’s what you would do.
In this example, the company’s CSAT is 80%.
For customers who reported being unsatisfied or dissatisfied, carefully review their entire interaction. Identify what happened, where your company could have been proactive, and what information could have provided a more pleasant experience. For example, did someone reach out with questions while setting up your product? Is there additional information or tips you could have preemptively provided to ensure a smooth, successful set-up?
For dissatisfied customers, identify ways to court them to try and maintain a positive relationship with them. Can you offer free shipping on their next order if this one was delivered late?
You’ll also want to learn from your satisfied customers. What are the key components that led to expectations being met? Did you offer the right tools at the right time? Did you quickly resolve an issue within 2 minutes on social media?
Don’t just look at your CSAT percentage. Dissect the outliers to learn how to exceed customer expectations in the future.
Customer service is one of the micro-moments that dictate loyalty and future spend. As mentioned earlier, one instance of poor service is enough to deter a major portion of your customers to move their business elsewhere. As customer service continues to establish its foothold as a business driver, companies need to meet expectations for customer support. Satisfaction, as you may remember, comes from expectations being met.
So what do people expect today? Simply, quick, convenient resolutions on their channels of choice. In our recent study, we found that:
- Nearly Half: Expect not to wait for a resolution
- 47%: Expect convenience
- 61%: Expect quick resolution
While that may sound simple, companies are finding it harder to meet these quick-rising demands and scale personal interactions across email, chat, social and voice channels. In fact, more than 50% of U.S. consumers have not seen any improvement in customer service over the last 12 months.
Bringing AI into the workforce enables companies to automatically resolve over 50% of incoming tickets immediately, within seconds, according to our customers. These repeatable, everyday tickets are not routed to human agents. Instead, agents focus exclusively on more complex and subjective issues. All tickets – the simple and complex – are resolved faster. Logically, bringing speed to support will increase CSAT.
One of our clients, the Canadian airline WestJet, has seen CSAT increase 24% with it’s virtual agent Juliet resolving issues immediately on Facebook Messenger. Juliet is helping people understand how they can fly with skis, how much it costs for a checked bag and flight status within seconds. Customers, all-too-often packing last-minute or stuck in traffic to the airport, are thrilled to get their pressing questions answered without a long hold time or desperate website search.