Consider this: just one bad experience leads roughly half of customers to switch to another service provider. If they have more than one unsuccessful interaction, 80% of customers would replace you with a competitor.
The main question is, how do you know if your customers are happy with your service and loyal to your business? One simple answer: by measuring customer experience metrics.
This article explores the primary KPIs to measure customer experience. We also give you actionable tips on how to improve your CX metrics.
Why Does CX Metric Tracking Matter?
Putting resources, time, and effort into improving your customer service based solely on assumptions can have the same effect as doing nothing at all. Plus, it wastes your money. A recent case proves this point.
A community bank’s branch management based its CX improvement strategy only on mystery shoppers and a few informal measurements. When they later started tracking CX KPIs, they found a mismatch between their own assumptions and their customers’ opinions. Just one example: the bank had overinvested in web experiences, but customers wanted to see more mobile app functionality instead. As a result, the company allocated its budget to experiences that didn’t matter to its customers, missed more critical information, and the bank lost out to its competitors.
| Reasons | Description |
| Customer satisfaction and loyalty | Monitor and improve satisfaction for loyal, repeat customers. |
| Competitive advantage | Stand out by providing a superior customer experience. |
| Reputation management | Build a positive brand image through consistent positive experiences. |
| Churn reduction | Address issues to retain customers and reduce churn. |
| Operational efficiency | Identify and streamline processes for cost savings. |
| Informed decision-making | Data-driven insights guide strategic decisions. |
| Customer-centric culture | Foster a culture focused on delivering exceptional experiences. |
| Continuous improvement | Identify trends, make changes, and measure impact over time. |
| Personalization and customization | Tailor offerings based on customer preferences. |
| Return on investment (ROI) | Assess the impact of CX efforts on sales and customer value. |
| Employee engagement | Engaged employees contribute to better customer experiences. |
| Predictive insights | Use historical data to anticipate future customer behavior. |
But careful customer experience KPI tracking can help you avoid these kinds of outcomes by giving you clear answers as to whether you have satisfied customers.
Customer-Experience KPIs: 12 Measures to Use
To make truly data-driven customer experience decisions and keep abreast of how your customers feel about your business, you need a set of key performance indicators for customer experience.
For your convenience, we’ve categorized customer experience indicators according to three important aspects of the customer journey strategy: user acquisition, engagement, and retention.
1 KPIs to measure customer acquisition
Let’s start with measuring how much effort you spend on customer acquisition and whether it’s paying off.
Customer acquisition cost (CAC)
Customer acquisition cost is your spending to attract a new customer. It’s the budget for your marketing and sales activities, which can include everything from employee salaries and service subscriptions to ad production, placement fees, and discounts for new customers.
For example, if for a period of three months, you spent $10,000 on customer acquisition activities and gained 20 new customers, it cost you $500 to acquire each customer.
Is that a lot? It depends on the lifetime value of each customer, which is the next KPI.
Customer lifetime value (CLV)
CLV reflects how much revenue one customer can bring your company over their entire purchasing lifecycle. To calculate this KPI, you need to know a customer’s entire buying history.
Conversion rates
Another useful CX KPI for looking at the success of your marketing efforts is conversion rates. This customer KPI measures how many users performed certain desired actions, like clicking on ads, signing up for webinars, or subscribing to emails. For reference, the average conversion rate for e-commerce businesses is 2.5-3%
Direct traffic
Direct traffic is all the traffic you get from people clicking on your website’s link. It can be manually typed in the URL bar, shared in messages or emails, followed from an offline source, or redirected from an unsecured or broken link.
Direct traffic indicates that people are sharing links to your website in personal communication or searching for it on purpose.
2 KPIs to measure customer engagement
Acquiring customers is only half of the job done if you want to generate ongoing sales. Keeping your customers engaged and interested in your offerings is important if you want them to come back to you and make additional purchases.
Let’s explore which customer experience key performance indicators to use to evaluate your engagement strategy.
Customer satisfaction score (CSAT)
The most effective way to evaluate the satisfaction level of your customers is to simply ask them directly. A low customer satisfaction score is a direct indication something is wrong with the way you deliver services.
Customer effort score (CES)
This KPI for customer experience evaluates how easy it is for your customers to perform a certain action, like placing an order, fixing an issue with delivery, or getting online support.
Average resolution times
If you noticed that your CES is suspiciously low, the reason might be long problem resolution times. When a customer contacts the support team, they expect a quick answer to their request. Long waiting times, several redirects, and a lack of support team expertise all lead to high resolution times and disappointed users.
Pages per visit
How engaging is your website? Are there enough redirections and interlinks? Do users lose track of time when they engage with your website? You can learn this information by analyzing how many pages, on average, a user explores per visit.
3 KPIs to measure customer retention
Loyal customers are a dream for any company. Customers that remain loyal to your company reflect indicate that you offer a high-quality product along with excellent customer service and, of course, a working retention strategy.
Customer retention rate
Customer retention rate measures how interested your customers are in staying with your company long-term. Remember that retaining customers is cheaper than acquiring new customers. Plus, just a 5% increase in retention rate can boost your revenue by 25% at the low end and by 95% at the high end.
Net promoter score (NPS)
The net promoter score takes only one question to discern whether a customer is satisfied with their product experience and how loyal they are to your brand.
Customer churn rate
Churn rate measures how many customers a business loses over a certain period. Keeping an eye on your churn rate helps you understand how many new customers you need to acquire to stay profitable. A high churn rate (10% and above) might indicate a big problem with your customer service.
Cart abandonment rate
A cart abandonment rate is the percentage of potential customers who add items to a cart but never end up completing a purchase. A high cart abandonment rate indicates that one problem or another led customers to quit their shopping journey, like perhaps complex payment and delivery procedures, high shipping costs, and so on.
How to Improve CX KPIs in SaaS
Finding out that one or more of your customer experience KPIs is lower than the number you would like to see can be a hard pill to swallow.
There are several strategies you can implement to improve your metrics, which will in turn, lead to increased sales and a higher quality of customer service provided by your business.
Segment your customers
Lumping your entire customer base into one pile might prevent your company from reaching desired KPIs.
To provide a more targeted customer experience, try segmenting your customers into groups based on their shopping history, demographics, purchasing power, and other factors. As a result, you’ll be able to offer better product recommendations, pricing options, and marketing messaging.
Track customer behavior to identify friction points
If your cart abandonment rates are a bit too high and pages per visit rates are a bit too low, a poor user experience might be the reason. While some UI/UX design choices might seem eye-catching at first, they can be confusing for users trying to complete a particular task, like finding a product through a search bar.
One solution to identify the obstacles users encounter with your digital presence during their buying journey is to track their behavior via dedicated tools like Hotjar. Such tools create heatmaps representing how users navigate through your website or app. For example, you can view heatmaps depicting where and how often users click and scroll, and how long they view different parts of your website or parts of a particular page. Use these results to identify bottlenecks.
Collect customer feedback at different stages of the user journey
Survey methods that measure the quality of customer experiences, like net promoter scores, customer satisfaction scores, and customer effort scores, can give you valuable insights into customer satisfaction with the service they receive at different stages of their journey.
Your main task here is to collect survey data in the right place at the right time. For example, it’s best to ask about their satisfaction level or likeliness of recommending your company as soon as a customer completes a certain task, like ordering an item, before they get distracted.
Add an internal resource center
Having a resource center on your website or in your app can free up your support specialists to resolve more complex issues.
Customers often need answers that don’t require involving a specialist, like learning about payment options or how to change a delivery address. You can add a FAQ section or AI-based chatbot to your platform to offer quick answers to common questions.
Use help desk software
Tracking several CX KPIs at once might seem like a daunting task, so use software with enough automation and data organization so that you can sit back and just gather analytics results.
For example, use a help desk solution to evaluate your support metrics. The top products provide valuable data about each help desk ticket, like resolution time, contact channel, ticket tags with inquiry type, and more. This information is key to reducing your average issue resolution time and improving customer effort stats.
Help Desk Software Will Improve Your Customer Experience KPIs
Your customers form impressions of your product and service quality throughout their journey and you must be aware of their experiences at every touchpoint. And that’s where customer experience KPIs kick in: these are powerful tools to point out strengths and weaknesses in the customer journey.
One of the working strategies for keeping your customer experience metrics and key performance indicators at satisfactory levels is to introduce help desk software for your customer support team.
Such solutions not only speed up the assistance process and standardize its quality, but they also consolidate CX-related data for further analysis. If your help desk solution, doesn’t have this functionality, don’t worry—you can use our Migration Wizard to easily move customer data from one platform to another.
Frequently Asked Questions
- CSAT (Customer Satisfaction Score): A direct measure of customer satisfaction based on a post-interaction survey.
- NPS (Net Promoter Score): Measures customer loyalty by asking if customers would recommend your business.
- CES (Customer Effort Score): Assesses how easy it is for customers to get their issues resolved.
The primary KPI for increasing customer satisfaction is the CSAT (Customer Satisfaction Score), which measures the level of satisfaction after each interaction.
Key KPIs for customer retention include Customer Churn Rate, Customer Lifetime Value (CLV), and Repeat Purchase Rate.
The main KPI for measuring customer experience is CX (Customer Experience) Score, which encompasses various metrics like CSAT, NPS, and CES.
Customer experience performance is measured by collecting and analyzing data from various touchpoints, surveys, and feedback channels. It involves tracking KPIs like CSAT, NPS, and CES.
A customer experience metric is a quantifiable measurement used to evaluate how customers perceive and interact with your brand. Examples include CSAT, NPS, and CES.
Effective KPIs for customer service include First Response Time, Resolution Time, Customer Retention Rate, and Service Quality Score.
The 5 C's of customer experience are Content, Context, Channels, Consistency, and Coordination. They highlight the need for a holistic and unified approach to customer interactions.
The 5 E’s of customer experience are Engage, Educate, Empower, Entertain, and Execute. These principles emphasize engaging customers, providing value, and delivering on promises.
The three golden rules of customer experience are Listen to Your Customers, Deliver Consistent Quality, and Empower Your Employees. These principles are essential for building strong customer relationships and loyalty.
