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What is a Customer Satisfaction Score?

What is a Customer Satisfaction Score?

You know well that the growth of any business largely depends on Customer Satisfaction, and measuring Customer Satisfaction has emerged as a prerequisite to maximizing it. But when it comes to choosing the best method and survey type to measure Customer Satisfaction, it becomes confusing and somewhat a tough decision to choose among the available alternatives.

You look for various aspects like ease of creating the surveys, sending them to customers and receiving maximum responses on them, converting them into meaningful data, and using it to measure Customer Satisfaction in quantitative terms. So the methodology you should choose must enable you to go through these steps easily and ascertain the extent of Customer Satisfaction.

Let's explore one of the most popular and easy-to-use method to measure Customer Satisfaction, i.e. Customer Satisfaction (CSAT) Score.

What is a Customer Satisfaction Score?

Customer Satisfaction Score or CSAT is a numeric metric which is used to measure Customer Satisfaction by asking a simple, straightforward question to the customers to rate their experience of a product, service or an interaction in terms of their satisfaction with it.

The rating options can lie between 1-5 among which the customers have to choose a score to rate their experience, 1 being the most negative experience usually represented with the words like pathetic or poor and 5 being the most positive experience usually represented by words like Excellent or Awesome.

Customer Satisfaction Score is an effective way to ascertain the happiness of your customers with your products and services. With its ease and simplicity to measure Customer Satisfaction, the methodology is useful at every stage of a consumer journey.

If at any stage, your customers get dissatisfied, with the help of Customer Feedback and measuring CSAT, it becomes easy to know about it at the right time and to take actions to improve Customer Experience. In this way, Customer Satisfaction Score becomes a great way to track customer happiness across customer life cycle.

Being an effective single-question survey, it has the potential of quickly collecting customer responses regarding their satisfaction at various touch points of every stage thus enabling you to find issues (if any) and resolve them before it gets too late.

What is the CSAT Survey Question?

CSAT Survey question is the single question asked in a CSAT survey to ascertain the level of Customer Satisfaction. The question is:

How satisfied are you with our products and services? (This question can also be changed to 'How was your experience with our organization or brand?')

When you want to ask this question about specific aspects of your business, you can easily replace 'our products and services' by the name of the particular product or service or aspect for which you are seeking feedback like 'your interaction with our help desk agent today' and so on. The question may differ in different companies depending upon the industry and the products and services they offer.

The question will be followed by 5 options like from 'Very Satisfied' to 'Very Dissatisfied' in the form of different adjectives, smileys or emoticons.

CSAT Question

Follow this up by open-ended question. It will help you a lot to get real customer insights and know the reason behind the scores given by the customers which will eventually help you to make improvements in your business.

How to Calculate the CSAT Score?

The calculation of CSAT score percentage is done by creating an average score of all responses. For this, you need to find the percentage of the sum of all the scores from the sum of maximum possible scores. You need to use this formula for this purpose:

CSAT Score (%) = Sum of All Scores/Sum of Maximum Possible Scores x 100

For instance, you have 8 customers who have responded to a CSAT survey question. They have given scores as 2, 4, 5, 1, 5, 3, 4, 5 out of 5 where the option of most satisfied is 5 and most dissatisfied is 1. The CSAT score will be:

CSAT Score(%) = 2+4+5+1+5+3+4+5/ 5+5+5+5+5+5+5+5 x 100

So, the CSAT score would be 29/40 x 100

i.e. 72.5 %

What is a Good Customer Satisfaction Score?

The average scores vary from industry to industry and to decide that your CSAT score is good or bad, you need to see the scores in your industry. Still a score around 80% is generally considered as a good CSAT score. Getting this score means you are able to satisfy 8 out of 10 of your customers which actually indicates success.

However, as CSAT measures only your promoter score, the score you obtain can not always be considered a good indicator of your company's position.

Why Measure Customer Satisfaction Score?

CSAT is one of the most popular metrics to measure Customer Satisfaction like NPS. Now the question arises why it is important to measure it. The answer lies in its effectiveness of measuring Customer Satisfaction in the most simple and easy way. And it not only helps you measure it, but also helps you work on it and increase it thereby reducing your customer churn rate and increasing your revenue.

1. It helps you know Customer Satisfaction directly

When you simply ask your customers to rate their satisfaction with your brand or a product, service, interaction; the customers give you scores on the basis of how they feel about their experience with you.

It is a direct and simple way, you do not need to spend much time on analyzing Customer Feedback to know whether the customers are satisfied or not, you directly get the answer about the level of Customer Satisfaction.

2. It helps you know Customer Expectations

When you know the level of Customer Satisfaction in terms of the rating given by your customers, you have the opportunity to ask the customers about the reasons for their rating. This helps you to know what are the expectations of your customers from you and your brand which eventually lets you meet and exceed their expectations that make the customers happy thereby increasing the growth of your business.

3. It helps to prevent Customer Churn

When you get to know about your satisfied and dissatisfied customers and the reason for their satisfaction and dissatisfaction, you get to know the strengths and weaknesses of your business. With the help of CSAT scores and their reasons, you come into a position where you know what you need to do and where you need to work to maximize Customer Satisfaction.

This helps in improving Customer Experience of the unhappy customers and thus helps you reduce customer churn. You can estimate how beneficial this is for your company with the fact that increasing customer retention by 5% helps in increasing your profits by 25-95%. After all, happy customers are the greatest promoters of your company.

4. It helps to drive Customer Experience improvement programs

CSAT is a good way to create benchmarks for your company by setting target CSAT and running Customer Experience improvement programs accordingly. This helps you identify the loopholes in your processes at different touchpoints and work on them to improve Customer Experience effectively.

5. It helps to increase revenue from existing customers

When you get to know CSAT scores and work towards improving Customer Experience, the customers come back and do repurchases. Not only this, experts suggest that 72% of customers will share a positive experience with 6 or more people. This in turn increases revenue from the existing customers and helps in overall growth of the business.

Now, lets learn when we should use CSAT scores to utilize them to the maximum extent.

When to Use Customer Satisfaction Score Surveys?

The effectiveness of a CSAT survey can be fully utilized only when you use it at the right moment. Let's learn when to use them to utilize its full potential.

1. Beginning of the Customer's Journey

First impression is the last impression. Keeping this in mind, you can use CSAT survey at the beginning of the customer journey in order to ensure that the customer has a good start with you. When your customers' lifecycle begins and the customers actually have started their journey by completing the process of onboarding, you can send a CSAT score survey to ask about their onboarding experience.

You can ask the customers to rate the experience of visiting your store, website, their first interaction with your organization or anything where you feel customers had an experience that can determine their purchase decision.

2. During or Post Check Out/ Transaction

You can use Customer Satisfaction Score during the important moments of a customer's lifecycle. When your customers have made a purchase or completed a transaction, you can use a CSAT score to capture feedback and find a score on their shopping experience. You can also use it after a month of use of a product to ask the customers' experience with the performance of the product.

3. Throughout their Use of Product and Service

Not only in the beginning or at the end, you should also use CSAT surveys throughout the use of product and services by the customers. For instance, you are an internet service provider company. You don't only need to take Customer Feedback at the beginning or at the end of services, but you should ensure Customer Satisfaction by conducting CSAT surveys at regular intervals to ensure that the customers are happy with your services and stay with you.

You can conduct monthly, quarterly, half-yearly or annual surveys for such purposes throughout the customer journey.

4. After a Customer Service or Support

Post Customer Interaction, service or support is another crucial time where you must take Customer Feedback. You can use CSAT score just after an interaction when you have provided a certain service or support to the customers in order to ask the customers about their experience.

When the customers interact or raise an issue, it becomes important to help them and resolve their queries and concerns. A CSAT survey is a simple and an effective way to know whether their issues were resolved and how much they are happy with the solutions provided thereof.

Pros and Cons of Customer Satisfaction Score

Everything has some pros and cons. So is the methodology of Customer Satisfaction Score. Before reaching out to the decision of choosing this methodology, look for its advantages and disadvantages to know whether it suits your business or not.

Advantages:

  • It is very simple and easy to use.
  • It involves a very short survey usually a single question survey not consuming much of the customers' precious time.
  • It has a great response rate as the customers comfortably and quickly answer the short survey.
  • It bears a good flexibility of its grading tool. With the help of a good CSAT Survey Software, you can easily choose among various options like numbers, emoticons, stars, or any other option you like as per your requirements.

Disadvantages:

  • It has an issue of Cultural Bias which comes into picture especially for those companies who are working in international market. For instance, studies suggest that Americans usually give extreme ratings like 'Pathetic' and 'Brilliant' whereas Japanese and native of other Asian countries mostly stick to 'Good' or 'Unsatisfactory'.
  • It mostly reflects immediate sentiments of the customers usually the experience of the last touchpoint the customer had with your organization and thus is not strong enough to convey overall satisfaction level of the customers.
  • It involves more of the responses of satisfied customers because dissatisfied customers usually are not interested in taking the survey, so the results cannot always be considered as good as they seem.
  • It asks about Satisfaction which different people perceive differently as per their desires and expectations.

Published on Nov 05, 2020. Updated on Dec 16, 2020.



Nikhil Dawer

Written by Nikhil Dawer

Nov 05, 2020

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