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How to measure customer satisfaction: 4 key metrics

10 min read
Customer satisfaction is about more than just minimising complaints. Here’s an introduction to the subject, along with 4 key customer satisfaction measurements that are critical to your business success.


What is customer satisfaction and why should you measure it?

Customer satisfaction is a common method used to determine how well you meet – or exceed – customer expectations. It is used as a key performance indicator of customer service and product quality.

 Customer satisfaction may be best understood in terms of customer experience. Customer experience (or CX) is the total sum of a customer’s perceptions, interactions, and thoughts about your business.

Customer satisfaction is a composite of many different aspects, and it is likely to change over time. Customers who develop attitudinal brand loyalty – that is, they have a positive emotional connection to a brand – have been shown to be less price sensitive than their less-loyal counterparts. They’re also more likely to convert when they buy from you. Highly satisfied customers are also likely to tell friends and family about their experiences and to promote your brand.

These are good reasons to aim for a level of customer experience that exceeds rather than simply meets expectations. But accurately knowing that you provide great customer service can be difficult without measuring customer satisfaction.

According to Mckinsey, you can see the impact improved satisfaction can make below:

CSAT Business Impact GIF

 

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4 key customer satisfaction metrics

So how do we effectively measure customer satisfaction?

Here are 4 key customer satisfaction measurements that are critical to your business success. They take into account the different dimensions of customer satisfaction, such as affective (emotional) and cognitive (rationally judged) reactions to a product or service and behavioural intentions (such as likelihood to recommend or repurchase) as well as taking overall scores of satisfaction as judged by the respondents.

If you’re ready to start measuring customer satisfaction, head to our customer satisfaction survey templates here.

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Start measuring customer satisfaction today with our free CSAT survey template

1. Overall Satisfaction Measure (Attitudinal)

Example question: Overall, how satisfied are you with “La Jolla Grove restaurant”?

This question reflects the overall opinion of a consumer’s satisfaction experience with a product he or she has used.

The single greatest predictors of customer satisfaction are the customer experiences that result in attributions of quality.

Perceived quality is often measured in one of three contexts:

  • Overall quality
  • Perceived reliability
  • Extent of customer’s needs fulfilled

It is commonly believed that dissatisfaction is synonymous with purchase regret while satisfaction is linked to positive ideas such as “it was a good choice” or “I am glad that I bought it.”

By using perception of quality and product satisfaction as a guide, we can better measure customer satisfaction as a whole.

2. Loyalty Measurement (Affective, Behavioural)

Example question:

Would you recommend “La Jolla Grove restaurant” to your family and friends?

This single question measure is the core NPS (Net Promoter Score) measure.

Customer loyalty reflects the likelihood of repurchasing products or services. Customer satisfaction is a major predictor of repurchase but is strongly influenced by explicit performance evaluations of product performance, quality, and value.

Loyalty is often measured as a combination of measures including overall satisfaction, the likelihood of repurchase, and the likelihood of recommending the brand to a friend.

A common measure of loyalty might be the sum of scores for the following three questions:

  • Overall, how satisfied are you with [brand]?
  • How likely are you to continue to choose/repurchase [brand]?
  • How likely are you to recommend [brand] to a friend or family member?

Understanding customer loyalty in this form of metric helps you to measure customer satisfaction from the angle of future behavior. It can be helpful not only for understanding customer satisfaction now but also for developing future purchase predictions.

3. A series of Attribute Satisfaction Measurements (Affective and Cognitive)

Example question: How satisfied are you with the “taste” of your entre at La Jolla Grove?

Example question: How important is “taste” in your decision to select La Jolla Grove restaurant?

Affect (liking/disliking) is best measured in the context of product attributes or benefits. Customer satisfaction is influenced by the perceived quality of product and service attributes, and is moderated by expectations of the product or service. The researcher must define and develop measures for each attribute that is important for customer satisfaction.

Consumer attitudes toward a product developed as a result of product information or any experience with the product, whether perceived or real.

Again, it may be meaningful to measure attitudes towards a product or service that a consumer has never used, but it is not meaningful to measure satisfaction when a product or service has not been used.

Cognition refers to judgment: the product was useful (or not useful); fit the situation (or did not fit); exceeded the requirements of the problem/situation (or did not exceed); or was an important part of the product experience (or was unimportant).

Judgments are often specific to the intended use application and use occasion for which the product is purchased, regardless if that use is correct or incorrect.

Affect and satisfaction are closely related concepts. The distinction is that satisfaction is “post-experience” and represents the emotional effect produced by the product’s quality or value.

Using this metric to measure customer satisfaction helps you to narrow down the causes of customer satisfaction levels. Unhappy customers may have a particular emotive response to products or services, rather than quality being the issue, for example.

4. Intentions to Repurchase Measurements (Behavioural Measures)

Example question: Do you intend to return to the La Jolla Grove restaurant in the next 30 days?

When wording questions about future or hypothetical behaviour, consumers often indicate that “purchasing this product would be a good choice” or “I would be glad to purchase this product.” Behavioral measures also reflect the consumer’s past experience with customer service representatives.

Satisfaction can influence other post-purchase/post-experience actions like communicating to others through word of mouth and social networks.

Additional post-experience actions might reflect heightened levels of product involvement that in turn result in increased search for the product or information, reduced trial of alternative products, and even changes in preferences for shopping locations and choice behavior.

How to measure customer satisfaction through KPI’s

Measuring customer satisfaction to gather your customer feedback, illuminate risk of customer churn, and discern loyal customers is useful, particularly over time.

However, it is better to measure customer satisfaction with particular goals in mind. By having scores you’re aiming to meet, whether that is an internal or industry benchmark, you’re able to track your progress over time and react to how you’re doing. If your actions aren’t improving your CSAT score, you might need to re-evaluate where you’re going wrong. 

So how do you set a realistic goal for your customer satisfaction score that can act as your KPI?

Improve on your past customer satisfaction score

The most obvious answer is to consistently improve on your past customer feedback. Taking an initial score as a benchmark and taking stock at regular intervals will help to not only measure customer satisfaction over time, but to constantly improve your service. Your score might refer to one part of the journey – for example, ordering a new car, or picking it up. Try to figure out what is causing the scores you’re receiving – Speak to customers, product teams, frontline staff – all of them have useful insights to help you improve. Of course, customer satisfaction will continue to change and evolve and you should treat it as such. 

Just because your score is high doesn’t mean it will stay that way – constantly look to improve!

Take a look at the competition

Your competition will almost certainly be measuring customer satisfaction. Understanding – to whatever extent you can – where you stand in comparison to your competitors will help you to set yourself customer satisfaction goals for the future.

Judge by industry benchmarks

Your industry will almost certainly have customer satisfaction benchmarks that will provide you with a solid guideline for measuring customer satisfaction. If you’re not meeting your industry’s baseline, then it’s likely that your customer experience is falling short of the expectations of your consumer base.

How to measure customer satisfaction through tools

Start measuring customer satisfaction today with our free CSAT survey template

Learning how to measure customer satisfaction is only part of the wider customer experience picture. Customer satisfaction is complex and ever-changing, and as a result, it’s important to take frequent measurements across a range of metrics in order to get the most accurate picture possible.

The wider measurement picture

Your customer satisfaction score should always be considered among a broader picture of data, including customer effort score, Net Promoter Score (NPS) and more. This will help you to understand customer sentiment and customer loyalty in relation to the service you’re providing.

But how do you keep track of all those customer satisfaction metrics, and how do you analyze them relative to one another to one-another and gather actionable insights?

How to measure customer satisfaction using cohesive tools

We recommend taking an ongoing approach to customer satisfaction, along with other metrics, as part of a broader customer experience program. By measuring and analyzing your customer satisfaction metrics within a single platform such as Qualtrics XM™, you’ll not only benefit from powerful analytic tools and easy-to-interpret results, you’ll also be able to integrate your findings with other elements of your customer experience data. But most importantly, you’ll be able to take action on your insights across the organization far more easily.  

Get started with our free CSAT survey template