Measuring customer satisfaction is always a good idea. It can teach you how to convert your regular customers into loyal customers, brand advocates, or even fanatics. CSAT is one of the most popular techniques for calculating customer satisfaction. Before measuring it, though, you have to know what CSAT is.
What does CSAT mean?
CSAT stands for Customer Satisfaction Score. If you’re looking for a definition, CSAT is a key performance indicator that shows how satisfied customers are with a company’s products or services. It’s a measure that quantifies the degree to which customers are satisfied with a product, service, or company.
CSAT is measured with a survey that contains questions like:
- “How would you rate your experience with our tool?”
- “How disappointed would you be if our company stopped providing you with our services?”
- “How satisfied are you with the advisor that you spoke to today?”
- “How satisfied were you during the 14-day trial account?”
- “How satisfied are you with the service provided today?”
A CSAT survey uses a scale that gives customers a range of possible responses. Each company chooses the range it wants, but the most common format is 1 — 5. Each number represents the following levels of customer satisfaction:
1- Very Dissatisfied
5- Very satisfied
As you can see, a CSAT score is basically a number that reflects a certain level of customer satisfaction. But when creating the questions for your CSAT survey, remember that you want your customers to always choose the highest score possible. So when asking, for example, “How would you rate your experience?”, the most desirable answer (“Very satisfied”) should be matched up to the highest score.
Craving more info on keeping your customers happy? Check out these 5 Tips on How to Increase Customer Satisfaction.
How Do You Gather and Calculate CSAT Scores?
Now that you know what CSAT means, let’s figure out how to use it. As we mentioned before, the fastest way to measure your CSAT score is to provide customers with a customer satisfaction survey.
Three useful methods for getting CSAT scores are:
- Follow-up calls – This is when a company representative calls a customer right after they’ve placed an order. Calling immediately after an interaction is a great idea. It is an effective way of collecting information about customer satisfaction. Your customer’s experience is still fresh in their mind.
- In-app surveys – If you want to reach the highest response rate, you might want to consider in-app CSAT surveys. Integrate a feedback bar into your website and ask 1 or 2 questions. Your customers can share their opinions while still using and engaging with your website.
- Email surveys – This is the most common way to request CSAT scores from customers. Despite lower response rates, email surveys offer deep insights since they often ask more questions.
How do you create a good CSAT survey?
When creating a CSAT survey, follow these 3 steps to make it as efficient as possible:
- The shorter, the better – Keep your survey short, as your customer will not want to spend more than a couple of minutes on it. Usually, 3-4 questions is all you need.
- The simpler, the better – You want your customers to see a question and immediately know their answer. That’s why you should keep your questions simple. A survey that’s easy to follow can improve customer satisfaction as well.
- Let customers stay neutral – Creating a survey with an odd-numbered scale will give customers a chance to give a neutral response. This is useful when they don’t know the answer or can’t make up their minds.
How do you calculate your CSAT Score?
Measuring your company’s CSAT score isn’t too difficult. Remember, your CSAT survey will include questions with a range of possible answers, like in the example below:
How satisfied are you with our company?
1- Very dissatisfied
3- Neither satisfied nor dissatisfied
5- Very satisfied
To calculate your CSAT score, you’ll first need to tally the number of positive responses that you received. A positive response is one that scored either 4 (“Satisfied”) or 5 (“Very Satisfied”). Next, simply take this number of positive responses and divide it by the number of all responses.
Let’s say that in our survey, the total number of responses is 300 and the number of positive answers is 240 for this particular question.
Now, multiply the number you received (0.8) by 100.
The CSAT score is expressed as a percentage, so your CSAT score in this case equals 80%. Well done!
Results vary by industry, but a good CSAT score is typically considered to be between 75-80%. This means that at least 3 out of 4 customers gave you a positive score. A good CSAT response rate is between 25-50%. The average response rate for CSAT surveys across all industries and companies is about 15%.
Remember, to increase the number of customers responding to your CSAT survey, think about how to best distribute it and make it easy to complete. Rewarding customers who have completed your CSAT survey is something to consider too.
When should you measure your CSAT score?
Measuring CSAT is straightforward. There are three approaches you can take when it comes to how often you should ask about customer satisfaction.
- After every single interaction
This is the most common way of measuring CSAT scores. Survey your customers after a transaction, a conversation with a customer support agent, or any other interaction between the company and the customer. Like we mentioned before, doing this will give you a response that’s based on a recent experience that’s still fresh in the customer’s mind. That makes it more meaningful!
- After several interactions
In some cases, your customer will have multiple interactions with members of your team. There is no point in sending the CSAT survey after the first interaction or after every interaction. This will make the customer dissatisfied. Estimate the number of interactions and choose the right moment to send the CSAT survey.
- Monthly, quarterly, yearly…
You don’t have to measure overall customer satisfaction right away. CSAT is good for making immediate improvements and learning about specific aspects of your company. But if you’re aiming for the bigger picture, you can always send customers the CSAT survey periodically. Ask them about their general feelings towards the company and their overall impression of it.
Remember that the frequency of your CSAT surveys depends on what you’re evaluating. If it’s a product, give your customers enough time to fully get to know it. If you are evaluating customer support or sales, ask about their satisfaction immediately.
How long should you measure CSAT for?
You should constantly be measuring your CSAT. It’s not that tough to do. Calculating it over an extended period of time shows whether your customers think your services are getting better or worse. Continuous measurement of your CSAT score will allow you to track changes and see what works and what doesn’t.
Why should you measure CSAT?
Tracking CSAT scores lets you know your customers better and improve your business based on their feedback. You should be able to get more satisfied customers, and satisfied customers turn into loyal customers. These are the people you need to make your business grow.
However, there are all kinds of other benefits that companies get from CSAT:
- Meet customer expectations more easily
- Pinpoint particular issues across your business
- Receive a metric that everyone understands
- Receive a metric that serves multiple purposes (sales, marketing, internal communication, etc)
- Reduce customer churn and create loyal customers
- Improve the overall customer experience
It’s hard to put a price on customer satisfaction, but it’s not hard to imagine the problems your business could face if it had dissatisfied customers. Consider these facts related to customer satisfaction:
- Over 89% of consumers have stopped doing business with a company due to poor customer service
- 13% of unsatisfied customers are likely to tell 15 or more people that they were dissatisfied with a business
- 95% of customers who gave an organization a CSAT score of 9 out of 10 were more likely to recommend a brand.
These numbers are reason enough to keep an eye on customer satisfaction within your business and to measure your CSAT score. It’s also worth knowing that it costs 5 times more to acquire a new customer than it does to keep an existing one, so keep those customers satisfied!
CSAT vs NPS, CSAT vs CES
CSAT isn’t the only metric that allows you to understand how customers feel about your product, services, and your entire company. It may be the most popular option out there, but NPS and CES are other important scores that can measure customer satisfaction.
What is NPS? What is CES?
NPS stands for Net Promoter Score. What does that mean? It’s a measure of customer loyalty over time.
How does NPS measure customer loyalty? Questions for an NPS survey usually look something like this:
- How likely are you to recommend this product to a friend?
An NPS survey normally uses a 0—10 scale, with 0 meaning “Very Unlikely” and 10 meaning “Very Likely.”
The questions on an NPS survey are different from those found on a CSAT survey. A high CSAT score shows you have several satisfied customers, but if only a few of them recommend you, your NPS score remains low.
What are the other differences between NPS and CSAT? NPS:
- Measures customer loyalty and satisfaction over time
- Doesn’t measure satisfaction after an individual interaction
- Helps a company improve customer loyalty, reduce churn, and increase customer retention and word-of-mouth
Want to know more about NPS? Here are 5 Tips How to Improve Your Net Promoter Score.
A third metric is known as CES. This stands for Customer Effort Score. It measures how easy or difficult it is to interact with a company and its products/services. A typical CES survey presents customers with questions like:
- Was it easy to handle your issue today?
Next to each question, customers can choose between a series of options that range between “Very Difficult” and “Very Easy.”
A CES score measures how easy a specific transaction or task is. Companies that conduct CES surveys can:
- Limit the spread of negative word of mouth
- Keep customer service costs down
- Improve self-service channels so customers can solve their own problems
- Enhance the overall customer experience by keeping satisfaction high
Which should I choose: CSAT, NPS, or CES?
Choosing between a CSAT, NPS, or CES survey isn’t a complicated decision. Remember, they all measure different things.
Always keep the following question in mind—why am I conducting this customer survey?
The main goal isn’t to gather data. It’s to measure the level of customer satisfaction and to find ways to improve it!
Selecting the right metric depends on many different factors. There are many different views on which metric to choose, but it usually comes down to these basic points:
- CSAT is great for keeping track of all services and products and for replacing anything that doesn’t work.
- CES is ideal for identifying and fixing certain areas of customer friction.
- NPS helps you measure and understand customer loyalty.
- Using a combination of these 3 metrics will give you the best results.
- Choose CSAT if you don’t have a strong preference for any of the given ways to measure customer satisfaction. It’s simple enough that everyone can understand it.
Measuring CSAT is a great way to get to know your customers and their feelings about your company, services, and products. Realizing how customers feel is the first step in making adequate changes. These will increase customer satisfaction and ultimately boost sales. With CSAT surveys (and a little luck), you can see your customers’ happiness skyrocket!
Read up on how to deliver an excellent customer experience.