Nothing makes business owners sweat buckets more than customers switching to a competitor, especially if a lot of time and money has already been invested in nurturing the relationship.
In many cases, churning customers is linked to customer satisfaction levels. If customers don’t feel like they’re getting what they need from a business or the service isn’t up to par, they may decide to end the relationship.
Negative word of mouth is also a major contributor to churning customers, as dissatisfied customers may spread their experience of a brand to potential customers, resulting in even more losses.
And yes, loyal customers are no exception. Zendesk reports that 66% of business-to-business (B2B) and 52% of business-to-consumer (B2C) customers stopped purchasing from a business after a bad customer experience.
Luckily, there are strategies you can adopt to improve customer satisfaction (CSAT) scores and reduce churn. In this article, we’ll discuss:
• What Is a Customer Satisfaction Score?
• Calculating Your CSAT Score
• What Is a Good Customer Satisfaction Score
• 6 Feedback Collection Strategies That Work Every Time
What Is a Customer Satisfaction Score?
Customer satisfaction is how happy and satisfied customers are with a business, purchase or interaction. To make it measurable, customer satisfaction metrics such as a customer satisfaction score (also known as a customer satisfaction index or CSAT score) are then used to gauge the customers’ overall experience with your brand.
CSAT scores are metrics for customer satisfaction, often collected using a customer satisfaction survey where shoppers are asked to rate businesses on a numeric scale of 0 to 100 or using descriptive terms like “very satisfied” to “very dissatisfied.”
A higher customer satisfaction score indicates better customer experience, while a lower score might signal the need for improvements in your products, services or customer support.
There are other metrics for gauging customer satisfaction, such as net promoter score (NPS), customer service satisfaction and customer effort score (CES), but today, we will focus on CSAT.
Calculating Your CSAT Score
To calculate the CSAT score, you divide the total number of positive responses by the total number of responses. The result is then expressed as a percentage, indicating the proportion of satisfied customers.
For instance, if you received 100 survey responses and 70 of them were either “satisfied” or “very satisfied,” your CSAT score would be calculated as follows:
Your CSAT score can help you identify areas for improvement and opportunities to serve your customers better.
What Is a Good Customer Satisfaction Score?
CSAT scores vary by industry, but a favorable score generally falls between 75% to 85%. According to Hubspot, a score of 75% indicates that three out of every four customers have rated you positively rather than neutrally or negatively.
The following figures represent industry standards for CSAT scores, according to the American Customer Satisfaction Index:
• Clothing: 79
• Automobiles and Light Vehicles: 78
• Banks: 78
• Breweries: 81
• Cell Phones: 79
• Software: 76
• Shipping: 76
• Credit Unions: 77
• Financial Advisors: 77
• Full-Service Restaurants: 79
• Hotels: 73
• Online Retail: 78
• Online Travel Services: 74
• Life Insurance: 78
• Specialty Retail Stores: 77
Why CSAT Scores Should Matter to Businesses in 2024
According to Emplifi, one negative customer care experience can lead to one in six customers leaving a company. Additionally, 86% of customers will leave after two negative interactions, while 73% will abandon a brand after a few poor interactions.
Needless to say, measuring and analyzing customer satisfaction should be a consistent practice in your business, not just a band-aid solution to reputation issues.
Ultimately, the goal for 2024 and beyond is to monitor and increase Customer Lifetime Value (CLV) while cultivating more lucrative relationships with existing customers.
So, what is the role of customer satisfaction scores in all this?
CSAT scores serve as metrics for customer satisfaction, offering valuable insights into how customers perceive your products and services. Utilizing customer satisfaction metrics gives businesses an objective understanding of customer satisfaction.
This allows you to identify which areas need improvement to increase CLV and potentially even bring in more customers from referrals.
Think of customer satisfaction metrics like CSAT as a bug detector – negative customer feedback through a customer satisfaction survey allows you to uncover friction points within your company and prioritize these issues to improve customer experience.
Ultimately, CSAT scores help you stay on top of any changes in customer sentiment and ensure you are on the right track for long-term success.
In the next section, we’ll discuss feedback-collection strategies businesses swear by.
6 Feedback Collection Strategies That Work Every Time
Customer feedback like CSAT scores provides valuable insights into customer pain points, experiences and preferences, which businesses can leverage to improve customer experience. However, it is important to be strategic when collecting and interpreting customer feedback.
Here are a few tips on how to improve customer satisfaction with the right feedback collection strategies:
1. Individualize Feedback Collection
Gathering segmented feedback based on user roles, industries or projects helps identify areas for product improvements tailored to different customer needs.
These tools will help you boost feedback quantity for driving user-backed decisions and product improvements:
• Survicate: Run targeted surveys on all digital channels, websites and mobile apps.
• Sender: Create automation sequences triggered by user behavior. So, you can send targeted feedback surveys during peak customer engagement.
• Involve.me: Choose from over 250+ interactive survey templates or customize a customer satisfaction survey without any coding required.
• Ruttl: A visual feedback and collaboration platform that allows you to gather valuable feedback from your team and clients through annotations, screenshots, video recordings and more.
• SurveyMonkey: Offers over 100 integrations and 12 pre-made survey templates for different niches but limited user customization options.
Expert Tip: Every question should have a goal. Personalize fields based on the type of feedback you want to collect. Then, ask users to rate their product experience and provide a reason for their score. This approach enables you to measure customer satisfaction based on qualitative and quantitative feedback.
2. Collect Real-Time Customer Feedback With Post-Interaction Surveys
Timing is key when collecting feedback from customers. Post-interaction surveys should be sent out as soon as possible after the customer experience has ended while the event is still fresh in their memory.
This way, customers can provide more detailed and accurate feedback about their experiences with your brand or product. Here are a few tips when crafting your survey:
• Ask open-ended questions that encourage elaboration.
• Keep it short and to the point – surveys should take no longer than 5 minutes to complete.
• Give customers the option to opt out of future survey requests.
• Use specific, actionable language in your questions to easily track customer sentiment over time.
• Break down complex questions into smaller, simpler ones. This will enable customers to answer more easily and accurately.
• Include a rating scale for each question so that customers can quantify their opinions.
• Utilize multiple choice questions when possible – this will make the survey easier and faster to complete.
3. Incentivize Shoppers To Increase Survey Completion Rates
It’s no secret that people love getting things for free. A PowerReviews study shows that 73% of consumers are willing to write a review when given an incentive.
What incentives should you offer?
Choose the incentive based on your product and target audience. If you sell makeup, shoppers prefer free product samples, while auto parts customers are more interested in loyalty discounts.
These data-backed incentives have been proven effective in generating reviews and driving customer engagement.
• 91% of shoppers would appreciate receiving the product free of charge.
• 85% would like exclusive access to the product before its official release.
• 67% would value a discount on future products.
• 59% would be interested in earning loyalty points.
4. Automate Feedback Collection
Manual customer feedback processes can be time-consuming and offer little in the way of insights. Automating outreach on various channels allows you to measure customer satisfaction and gather feedback at key customer journey touchpoints, such as website visits, onboarding completion and interactions with customer service.
For instance, customer satisfaction software is a more efficient way to manage survey campaigns and measure customer satisfaction.
Customer satisfaction software offers a formalized report based on data collected from a customer satisfaction survey. The tool provides a more comprehensive view of customer sentiment by mapping feedback data to product categories and other attributes, such as the duration of customer interactions with service representatives or the time it takes to resolve an issue.
Expert Tip: Collect direct customer feedback at critical moments in their journey using timed surveys, pop-ups or emails. This allows you to make precise adjustments to improve customer experience and address potential sources of frustration.
5. Use Social Media Platforms To Gather Feedback
Customers often share their feedback directly on social platforms. Monitoring social media and review sites lets you stay informed about popular sentiments, negative word of mouth and conversations surrounding your product and user experience. Here’s how:
• Check review sites like Capterra, Trust Pilot, TrustRadius and G2 for detailed product reviews and comparisons.
• Utilize social listening and sentiment analysis tools, such as Brandwatch, to track brand or product mentions on social channels.
• Analyze user sentiment and opinions to boost product positioning and gain insights on how to improve customer satisfaction.
6. Use Feedback To Identify Self-Service Opportunities
Every customer interaction is an opportunity to gain valuable insights that can be used to assist others facing similar issues. You can repurpose data acquired from customer feedback into self-service opportunities that can help customers solve their problems faster. Here’s how:
• Create simple knowledge-based articles that will help customers quickly find the answers they need.
• Develop FAQs and product tutorials to provide step-by-step instructions for particular tasks.
• Enhance existing online forms, chatbots or other automated services to improve customer service quality.
This reduces the need for customers to contact service agents and reduces wait times for basic inquiries.
Improve Customer Satisfaction With Feedback
Analyzing feedback can help you spot recurring customer issues that could improve customer satisfaction and reduce churn. This allows your team to identify larger, systemic problems that a single interaction or self-service option cannot solve.
To be successful, feedback collection has to be intentional and data-driven – something only an online reputation management expert can help you with.
Thrive Local offers a suite of tools to help you collect feedback and measure customer satisfaction from various channels. From sentiment analysis to competitive benchmarking, our ORM experts work with you to identify key trends in customer reviews and make well-informed decisions.
Partner with us to ensure your online presence is aligned with your goals — all while creating a positive customer experience. Contact Thrive Local today for a free demo.
