Why customer experience must be a priority for small businesses
Updated: Jun 23
Measuring customer satisfaction
We all know we need to aim to provide a good customer experience. But are you aware of all the benefits that a good customer experience brings and do you know how to measure customer experience?
Put simply customer experience is how customers perceive their interactions with your business. This is more important than ever right now as we’re working extremely hard in the current climate to keep our customers, and even harder to recruit new ones.
So why should you measure it?
Customer satisfaction metrics are a good way to measure the health of your business and identify any potential glitches or weaknesses. If you’re a small business owner, you may measure customer satisfaction informally by how you personally interact with customers and how they respond to you.
As your company expands, you’ll need to employ people and potentially subcontract out, which means you'll need a formal way to capture customer feedback and maintain the high standard you’ve set.
Businesses that deliver a consistently high level of customer service typically work towards achieving this result. It rarely happens organically. In fact, businesses that actively work on improving customer experience can see a 92% increase in customer loyalty, an 84% uplift in revenue and 79% cost savings according to PR Newswire. And studies show that 80% of people switch brands after one bad customer experience.
The numbers are pretty compelling, but there are other benefits as well. By getting under the skin of the experience you’re delivering, you’ll understand the needs and wants of your customers in a much deeper sense. This will make your decision-making process easier and you’ll also be able to benchmark your business against industry standards.
How to measure up
Customer experience metrics are the KPIs a business uses that involve customers’ input. These metrics help you understand how loyal or satisfied your customers are. The most popular customer experience metrics include Net Promoter Score and customer satisfaction, but there are several simple ways any business can start to measure customer satisfaction.
1. Net promoter score
As mentioned Net Promoter Score, or NPS as it is known, is the most popular way of measuring customer experience. It measures how likely your customers are to recommend your business to a friend.
To calculate this score send this question to your customers; ‘On a scale of 0-10, how likely are you to recommend [your business] to a friend?’ 0 is not likely at all and 10 is extremely likely.
Scores between 0-6 are considered detractors. Those scoring between 7-8 are passive, with no strong feeling. 9-10 scores are promoters and 'advocates' of your business. This is where we should aim to be.
You’ll be able to use this score to track how you're performing and monitor improvement.
2. Customer journey mapping
I use customer journey mapping all the time with my clients. The aim is to understand what it is like to be a customer of your business, by creating a visual map of every interaction.
Map out the journey your customer has from their very first contact with you. Once you have a better understanding of how easy or hard it is for a customer to achieve their goals and/or meet their needs with you, you may have some action points to smooth out certain processes.
3. Customer surveys
Customer surveys are an efficient way to gather information from your customers. You can obtain feedback in a structured way about their experience making it easy for you to analyse. Sometimes it is beneficial for a 3rd party to administer the survey if you're worried that your main customers may not be honest with you if the survey has come from you.
Surveymonkey is an ideal tool for creating and analysing surveys. They have tips on how to create the ideal customer survey.
You can even use the survey and results to collect testimonials.
4. Calculate churn
Churn is the percentage of customers who don’t renew their business with you over a period of time. For subscription businesses this is more straight forward as its how many customers cancel or don’t renew their business. For other businesses, with a one-time purchase model, you could look at whether a customer returns within a given time frame.
If you have a high level of churn it could be an indicator that there are areas in need of improvement. Make sure to ask customers that leave, why they are moving on. This is a common practice and will give you a complete insight into where you could do better, or whether there are market conditions outside of your control.
5. Customer support ticket trends
Every business should be keeping track of their inbound customer service tickets. A ticket is any inbound correspondence, such as email, telephone call, social media post, letter etc.
There are many metrics to follow here. The easiest measure is the total number of tickets per customer per day. You can then drill down into how quickly you can respond and ultimately resolve any customer issues.
By measuring this you can see the level of service each of your customers are getting in terms of speed and quality. In general, good customer service starts where a customer doesn’t have to get in touch with you at all (self-serve), or if they do, you respond quickly and resolve their issue immediately.
Where measuring customer service tickets can be extra beneficial to your business is in labelling the tickets. Give each ticket a name relating to what the issue is about. You’ll be able to see trends in what causes the most number of tickets and develop processes to improve these areas of the business.
Room for improvement
So you can see measuring customer experience is relatively easy. You can gain a wealth of knowledge that can give you that competitor edge and ensure your customers become brand advocates and keep coming back to you.
Give it a go and see where your business sits. Then set some goals and aim to track your customers experience over a prolonged period. You’ll be surprised at all the information you glean. There is always room for improvement.