NPS: Net Promoter Score (NPS) is a customer loyalty metric that measures how likely customers are to recommend a company's products or services to others.
It is calculated based on responses to a single question: "On a scale of 0 to 10, how likely are you to recommend our company to a friend or colleague?" Customers who respond with a 9 or 10 are considered "promoters," while those who respond with a 0 to 6 are considered "detractors." And Customers who respond with a 7 or 8 are considered "passives." NPS is calculated by subtracting the percentage of detractors from the percentage of promoters.
It’s important to know how detractors and passives differ.
In customer satisfaction research, a detractor is a customer who is unhappy with a product or service and is likely to spread negative word-of-mouth about it. A passive customer is one who is satisfied with a product or service but is unlikely to spread word-of-mouth about it, either positive or negative.
When to send NPS surveys?
Net Promoter Score (NPS) surveys are typically sent at key touchpoints throughout the customer journey, such as after a purchase or service interaction. The goal is to understand how likely customers are to recommend your product or service to others.
It's recommended to send NPS surveys:
After a customer has made a purchase or completed a service interaction.
At regular intervals, such as every quarter or every six months, to track customer satisfaction over time.
When a customer has had a significant interaction with your company, such as after a customer service call or after using a new product feature.
After a customer has had a negative experience, so you can identify and address issues promptly.
After a significant change in the company, such as rebranding or launching a new product, to gauge customer reactions.
It's important to keep in mind that the timing of the survey can have a significant impact on the responses you receive, so try to send the survey when the customer experience is still fresh in their mind.
What is CSAT?
CSAT (Customer Satisfaction Score) is a metric that measures how satisfied customers are with a particular product or service. It is typically calculated by asking customers to rate their satisfaction on a scale, such as 1-5 or 1-10, and then averaging the responses.
For example, a company might ask customers to rate their satisfaction with a recent customer service call on a scale of 1-5, with 1 being very unsatisfied and 5 being very satisfied. The company would then calculate the average satisfaction score by adding up all of the ratings and dividing by the number of respondents.
Industry standards vary, but a CSAT score of 80-85% is generally considered good, while a score below 80% is considered poor. However, it's important to note that CSAT scores can vary depending on the industry and the type of service or product being offered. For example, a CSAT score of 90% for a software as a service (SAAS) company would be considered excellent, whereas for a retail store a CSAT of 80% would be considered good.
It's important to use the CSAT score in combination with other metrics such as NPS and CES to gain a comprehensive understanding of the customer experience, as it only measures one aspect of it.
When should CSAT surveys be sent?
CSAT surveys are done frequently. Ideally, after a customer touchpoint. However, there must be a gap of 2 weeks between sending the CSAT survey especially if the survey is for the same team.
There are a few key times when it can be particularly useful to send Customer Satisfaction (CSAT) surveys to customers:
· After a key customer interaction: Sending a CSAT survey after a customer has interacted with your company in some way, such as after a purchase or customer service interaction, can provide valuable insights into the customer's experience and help you identify areas for improvement.
· On a regular basis: Sending CSAT surveys to assess the relationship on a regular basis is a possibility (especially if the company is not using NPS), such as quarterly or annually, which can help you track customer satisfaction over time and identify any trends or changes.
· After a significant change: If your company has made a significant change, such as a new product launch or a change in your customer service process, sending a CSAT survey can help you gauge the impact of the change on customer satisfaction.
· After a customer has had an issue: If a customer has had an issue with your product or service, sending a CSAT survey can help you understand their perspective and identify any potential problems that need to be addressed.
Overall, the key is to find a balance between gathering enough data to make informed decisions, while not overwhelming customers with too many surveys. It's generally recommended to send NPS surveys at least once per year, and more frequently if possible, to get a good understanding of customer loyalty over time.
When is measuring CSAT better than measuring NPS
There are a few situations when measuring Customer Satisfaction (CSAT) may be more appropriate than measuring Net Promoter Score (NPS):
· When the primary focus is on satisfaction: CSAT is specifically designed to measure customer satisfaction, so it may be a better choice if your primary goal is to understand how satisfied customers are with your products or services.
· When you want more granular data: CSAT surveys typically ask customers to rate their satisfaction on a scale, such as 1 to 5 or 1 to 10, which can provide more detailed and granular data compared to NPS.
· When you want to understand specific areas for improvement: CSAT surveys often include additional questions that ask customers to provide feedback on specific aspects of their experience, such as product quality or customer service. This can provide more detailed insights into specific areas for improvement.
When is measuring NPS better than measuring CSAT
There are a few situations when measuring Net Promoter Score (NPS) may be more appropriate than measuring Customer Satisfaction (CSAT):
· When the primary focus is on loyalty: NPS is specifically designed to measure customer loyalty, so it may be a better choice if your primary goal is to understand how likely customers are to continue doing business with you and recommend your products or services to others.
· When you want a quick, easy-to-understand metric: NPS is based on a single question: "On a scale of 0 to 10, how likely are you to recommend our company to a friend or colleague?" This makes it a quick and easy-to-understand metric that can be easily tracked over time.
· When you want to compare your company to others: NPS is a widely used metric, and there are established benchmarks for different industries. This can make it easier to compare your company's NPS to others in your industry and see how you stack up.
Pro tip: Ideally, conducting both NPS and CSAT surveys is a must.
What Is CES?
Customer Effort Score (CES) is a customer satisfaction metric that measures how much effort a customer had to put into interacting with a company. It is typically measured using a survey that asks customers to rate their level of effort on a scale, such as 1 to 5 or 1 to 10. The lower the rating, the less effort the customer had to put in. It’s best to have CES as a question embedded within the CSAT survey.
What is a driver question and what is the importance of a driver question?
A driver question is a question that helps identify the specific factors that are driving customer satisfaction or loyalty. In the context of Customer Satisfaction (CSAT), a driver question might ask customers to rate their satisfaction with specific aspects of the customer experience, such as product quality, ease of use, or customer service. In the context of Net Promoter Score (NPS), a driver question might ask customers to explain the reasons behind their NPS score, such as what they liked or disliked about the company's products or services.
The importance of driver questions lies in their ability to provide more detailed and actionable insights into customer satisfaction and loyalty. By identifying the specific factors that are driving customer satisfaction or loyalty, companies can focus on improving those areas in order to increase customer satisfaction and loyalty.
Driver questions can also help companies identify trends or patterns in customer feedback, which can inform strategic decision-making and help prioritize improvements to the customer experience.
NPS, CSAT, and CES are valuable metrics for businesses because they help identify areas for improvement and increase revenue. Companies with high scores are generally more successful, as they have a strong base of loyal customers who are likely to continue doing business with them and recommend them to others.
Pro tip:
Conduct both NPS and CSAT surveys to measure CES as a part of the CSAT survey and never have a survey that does not have a driver question. There’s no point knowing the scores unless you know what the primary reasons for the scores are and what you need to focus on – continue to do and/or improve.