EnglishEnglish
Tiếng ViệtTiếng Việt

Customer experience measurement methods (Part 1)

The method of measuring customer experience depends on the characteristics, goals, and KPIs of the business.

1. Measuring customer experience through customer effort score (ces)

1.1 What is CES?

Measuring customer effort is crucial for determining customer satisfaction and their future behavior. Studies have shown that making the customer experience easier is a quicker and more effective way to gain their loyalty than providing additional customer services. The root cause of customer frustration is often product or service experiences that are too difficult, creating barriers that drive them away.

The Customer Effort Score (CES) is a metric used to measure the customer experience with a product or service. Customers rate their experience on a scale from “Very Difficult” to “Very Easy” (usually on a 7-point scale). This helps determine the level of effort required to use a product or service and the likelihood of customers continuing to pay for it. Based on this metric, businesses can focus on making things more convenient for customers, enabling easier access and use of their products or services.

CES surveys are typically sent after an interaction with customer service, with questions like, “How much effort did you have to put in to do A with our company?” and a rating scale from 1 (very difficult) to 7 (very easy). CES can also be applied to key milestones in the customer journey (for example, after signing up for a free trial product or successfully completing a transaction).

1.2 The Role of CES in Business

  • CES predicts future customer purchasing behavior: The easier it is to buy something, the more likely customers are to return for repeat purchases. A study published in the Harvard Business Review found that a low-effort customer experience is one of the strongest predictors of future buying behavior. 94% of customers who had a low-effort experience reported they were likely to repurchase the product.
  • CES indicates the likelihood of customer referrals: Easy transactions and interactions are strong factors in encouraging customers to recommend and speak positively about your business. Conversely, if the experience is difficult, they are more likely to speak negatively. The Harvard Business Review study also showed that 81% of customers would share negative feedback about a company that made them put in high effort to experience their product or service.
  • CES predicts customer loyalty: A study revealed that 96% of customers who had high-effort experiences would not remain loyal to the product or brand. If a company has low customer satisfaction scores, it can use CES to identify problem areas within the organization. Once you identify where customers are putting in the most effort, you can start working on improving these areas to reduce customer effort. This will help improve customer satisfaction over time.

 

customer experience

1.3 Formula for Calculating CES

The formula for calculating the CES score is: CES Score = Total Rating / Total Number of Survey Responses

  • CES from 0-3: Poor customer experience
  • CES from 4-5: Average customer experience
  • CES from 6-7: Good customer experience

The higher the CES score, the less effort the customer has to exert, indicating a better customer experience.

1.4 Advantages and Disadvantages of CES

* Advantages:

  • The ease or difficulty of the customer experience is less likely to be influenced by external factors, making CES more stable than other metrics when predicting customer loyalty.
  • The survey model and scoring system are simple, making it applicable across all customer-related processes.
  • CES is a reliable method for predicting customer behavior and satisfaction.
  • It is easy to identify areas that need improvement in the service process using CES.

* Disadvantages:

  • CES is limited in scope, being most effective for service-oriented businesses and not applicable to all types of companies.
  • CES only provides information on whether customers found the service difficult or easy, without identifying the specific reasons behind their ratings.
  • Factors like cost, competition, or product quality are not considered in the CES score.

2. Measuring customer experience through net promoter score (nps)

2.1 What is NPS?

NPS stands for Net Promoter Score, introduced by Fred Reichheld in the Harvard Business Review in 2003, and is commonly used to measure customer loyalty. Currently, more than two-thirds of the top 1000 global companies use NPS (according to Bain & Company).

Recently, the developers of NPS have enhanced the system by incorporating principles and lessons learned from over a decade of practical application. Therefore, NPS has evolved into more than just a measurement tool; it has become a customer experience management system, which is why, since 2015, it is often referred to as the Net Promoter System.

To calculate the NPS score, you first need to survey your customers. NPS is derived from their response to the following typical question: “On a scale from 0 to 10, how likely are you to recommend company A to a friend or colleague?”

Customers choose a number from 0 (Not at all likely) to 10 (Extremely likely). Based on their responses, customers are categorized into three groups:

  • Promoters (9-10 points): Customers who rate the company 9-10 are considered promoters. They have the highest repurchase rate and are responsible for recommending 80% of new customers to the company.
  • Passives (7-8 points): Customers who rate the company 7-8 are “passive satisfiers” or indifferent customers. They are driven more by inertia than loyalty or enthusiasm, and they may leave the company if a better deal comes along.
  • Detractors (0-6 points): Customers who rate the company 0-6 are detractors. While some may still bring in revenue for the company, their negative feedback and attitudes can damage the company’s reputation, discourage new customers, and demotivate employees. They are the “energy drainers” of the company.

2.2 Advantages and Disadvantages of NPS

* Advantages:

  • Companies that apply NPS effectively often notice a cultural shift toward customer-centricity, leading them to create outstanding customer experiences.
  • The NPS question can be adjusted to better fit the specific needs of your business, and follow-up questions can provide more insights. The NPS score itself is a decimal point value ranging from 0 to 100, representing customer experience.

* Disadvantages:

  • The NPS focuses more on the overall experience with the brand, making it difficult to pinpoint the exact touchpoint that causes “pain” for customers.

Customer experience measurement methods help businesses evaluate customer loyalty or satisfaction with their brand. This allows them to make necessary changes and improve the customer service process for a better experience.

(To be continued)

Additionally, you may refer to the article:

Source: https://khaosat.me/blog/so-sanh-nps-csat-ces/

HRDC Compilation and Sharing.

BÀI VIẾT LIÊN QUAN

RECENT POSTS