The second essential KPI for customer-centric companies is Customer Satisfaction, also called CSAT. Many brands are moving away from NPS, and we would say wisely, and are adopting customer satisfaction instead. What is it? The most common form of CSAT is the star rating, like the one that you find on Google, Amazon or Tripadvisor. It’s a very simple metric, that’s why customers love it! At the same time, it gives you a clear view of how customers like the experience with your brand and its products and services. The scale usually goes from one to five…but be careful because the satisfaction level is not linear. This means that if your average score is from 1 to 3.5, you’ll have very unhappy customers. If it’s between 3.5 and 3.9 they are somewhat satisfied. Between 4 and 4.4 you would have a very good score, but only if you hit between 4.4 and 4.8 you would have very satisfied customers. Be aware that scores of 4.9 and 5 are usually considered unrealistic by your future customers, therefore, even if you reach these numbers, you would not generate extra revenue compared to lower scores
The last KPI for customer-centric companies is also crucial to determine the health of your business. We’re talking about Churn rate. Customer churn rate reveals how many of your customers have stopped using your products or services. Generally, the churn rate represents the percentage of lost customers within a specified period of time. It can also be expressed in monetary value, representing the amount of revenue lost due to the loss of customers. Following the customer churn rate is critical because usually, it is much cheaper to retain existing customers than to acquire new ones.
For more interesting content, click here.
