In a dynamic business environment, if you’re not measuring your customer satisfaction on a regular basis, you’re likely already behind.
Customer expectations are constantly evolving. Moreover, increased competition and innovation are changing customer expectations and perceptions quickly. It’s not enough to just know whether your customers’ expectations are being met. You also need to know how well you meet those expectations relative to your competition and the factors influencing their perception of quality.
Carrying out a CSAT study that effectively captures these insights will go a long way in measuring your competitive position and identifying the areas you need to improve on.
What is a CSAT study?
A CSAT study helps measure customer satisfaction for a brand, product, or service. Calculated based on customer survey inputs, it helps companies:
- Understand customers’ satisfaction levels across various touchpoints
- Understand the key factors influencing their preferences
- Identify your as well as your competitors’ strengths and weaknesses
- Find the areas in the customer experience that need improvement
- Guide the action plan for customer experience improvement across customer segments
Calculating a CSAT score can be as simple as asking your customers ‘How would you rate our service on a scale of 1-10?’ after they’ve completed a purchase. But a CSAT study works best when it’s comparative. For example, a CSAT score 9 means a lot if you know that your competitor scored a 7. That’s why it’s important to track your competitors’ CSAT scores against your own to be able to determine where you stand.
Measuring your CSAT score
Before you actually conduct a CSAT study, it’s important to have a thorough understanding of your customer’s requirements. Knowing the things that matter most to them goes a long way in developing questionnaires that effectively capture customer expectations.
Understanding customer requirements
Understanding customer needs, expectations, and preferences puts you in a better position to know how to satisfy them. But how can organizations gather this information? The key is to listen to your customers where they are most vocal about their opinions.
Customers are constantly telling you what they think across online platforms, social media, as well as customer support channels, including customer chat, email, and Q&A forums. Tapping into these sources allows organizations to identify customer requirements. Depending on our clients’ specific needs, Netscribes uses a combination of primary, desk and social media research to gather and monitor customer feedback. Furthermore, we use this data to draw insights about customer expectations and their perceptions of quality and value.
A company that’s in the business of selling credit cards, for instance, might find that topics around customer care, rewards, and security account for a bulk of customer feedback. These aspects should, therefore, be considered as customer requirements.
Once you have identified their requirements, the CSAT score is calculated based on their relative importance to customer’s purchase or relationship decisions, and the associated satisfaction levels.
Essentially, CSAT scores are calculated as a function of two factors:
- Relative importance of features
- Satisfaction level
Gauging the relative importance of the product or service’s features is the first step to measuring CSAT. This is essential for two reasons. First, it puts you in a better position to understand the most influential features in the customers’ decision-making process. Second, it allows you to prioritize your customer success efforts.
Let’s say you’ve identified client care, quality of customer care, organizational capabilities, value for money, and brand reputation to be the prevailing customer requirements. You need to then ask respondents to rate each requirement on a scale of 1-10 by their importance. The most important factor will be rated 10, while the least important factors will be rated 1. Next, rank the attributes by taking an average of the score given by the respondents.
Once you’ve recorded customer input on the aspects that matter most to them, it’s time to understand how satisfied they are across those parameters. Satisfaction scores are measured on a 1-5 Likert scale. Each of the broad attributes can have several sub-attributes. For example, Client care can have the following sub-attributes:
- Quality of the complaint resolution
- Complaint Resolution Time
- Client meeting frequency and effectiveness
- Problem-solving capability in a timely manner
- Prompt reply over emails and phone calls etc.
The performance of target companies, including competitors, will be measured based on the rating scale. A rating of 4 or 5 out of 5 are marked as ‘Top 2 box score’ and rating of 1 or 2 out of 5 are marked as ‘Bottom 2 box score’, while rating a of 3 out of 5 is marked as ‘Middle Box’ or neutral score.
For example, if delivery is the attribute and ability to deliver on short notice is a sub-attribute, then the respondent will assign an importance score on ‘delivery’ attribute and rate ‘ability to deliver on short notice’ on the basis of his/her delivery experience.
Overall CSAT score
The overall satisfaction score is then calculated based on the importance score assigned by the respondents and the satisfaction ratings on each of the individual sub-attributes.
The ratio of the top-2 box and bottom-2 box responses are measured to estimate the level of commitment and loyalty. A higher top-2 box score depicts higher commitment, while a higher bottom 2 box score depicts higher vulnerability.
CSAT studies can be carried out for B2B, B2C, as well as B2B2C companies. In a B2B scenario, customer satisfaction can be measured across senior, mid and junior respondents and different customer organizations. In B2C and B2B2C segments, it can be measured by respondent demographics, such as age group, gender, geography, among other parameters.
In summary, this model of a CSAT study has several advantages. First, it helps an organization identify the areas in which it meets customer expectations and the factors responsible for driving its CSAT score. Second, it helps to see the areas that need improvement. What’s more, organizations can measure their CSAT performance relative to their competition and identify the industry best practices.
Netscribes is a global customer data and insights leader, helping organizations to understand and meet evolving consumer needs. To know more about our consumer research and insights solutions, contact [email protected].