Are you confident in having a good understanding of your audience, their needs, and their pains? Trust us, if they put on a smile and just nod in response to a question about whether they like your product, it doesn’t mean they really do. Simple feedback isn’t enough to evaluate customer satisfaction. But keep calm, there is no need for long conversations with every customer about how they would like your business to improve. Classic and affiliate marketing have long used a specialized set of formulas to measure customer satisfaction. In this article, we’ll look at the most important customer experience metrics to understand.
Customer experience metrics basics
The customer experience (CX) or Voice of the Customer (VoC) is a method of researching user expectations and needs. This method covers everything users say and write about a business and helps bridge the gap between expectations and the actual experience of interacting with the company.
But to work on improving customer interactions with your product, you first need to measure CX correctly. The purpose of customer experience analytics is to examine the potential customer journey and identify barriers, and weaknesses. These metrics provide a complete picture of the customer’s experience of interacting with your company. Based on the data collected, you can build new hypotheses and improve product quality.
Key customer experience metrics
Every business has its own definition of the customer experience indicator. In the affiliate sphere, it largely depends on the vertical you are operating in and the specifics of the offer. Some metrics are already included in your affiliate network account stats list as KPI, others will need to use additional trackers or other tools. We have compiled a list of the most commonly used customer experience metrics for you.
NPS
Net Promoter Score, or the Customer Loyalty Index, measures customer loyalty. In addition, this metric shows how willing your customers are to recommend your brand or product to their friends or colleagues.
The easiest way to collect data is through a survey. Ask customers how likely they are, on a ten-point scale, to recommend the brand. Then subtract the percentage of responses with a score of 9–10 from the percentage of responses with a score below 7. The result is the NPS score. This has a direct impact on retention, brand awareness, and cost of client engagement.
NPS = % of promoters (below 7) – % of critics (8+)
CSAT
The Customer Satisfaction Score or Customer Satisfaction Index is an indicator that measures customer satisfaction with a company, a purchase, or an interaction. It is similar to the customer loyalty indicator because it is also based on real customer feedback rather than internal company data. However, this indicator is much more flexible and varied than the NPS.
The Customer Satisfaction Score is measured on the basis of how customers rate their interaction with your company. You also have a lot of choices in terms of what specific questions you ask customers, what rating scales you use, and so on.
To hate your CSAT, ask users how satisfied they are with the service/product/company on a scale of 1 to 10. A score in the 75–85% range is considered good.
CSAT = number of 7,8,9,10 / number of answers to question * 100%
CES
The Customer Effort Score or Customer Effort Index shows how much effort a customer has put into ordering a product or using it. There is a direct correlation between loyalty and effort: the easier it was for the customer, the more they will love the company.
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To calculate the customer effort index, questions starting with “How easy was it…” are used. This can be used to investigate anything from searching for an item on a website to making a delivery. CES allows customers to rate their effort experience on a scale ranging from 1 to 7. Then you’re summing up all the survey figures and divide by the number of respondents. Scale 1–3 segment will be associated with negative results, whereas the 5–7 segment represents positive results. A good Customer Effort Score is 5 or more.
CES = sum of all customer effort scores / total number of respondents
Churn Rate
Customer churn rate tells you the number of customers who have stopped using the company’s products/services in a given period of time. It helps you to think about why users are leaving and how to get them back. Such losses are costly to businesses.
To calculate the Churn Rate, first, choose a period for evaluation. At the end of the period, calculate the number of customers who left. Divide it by the number of customers at the beginning of the period. On average, you get 5–7%. More than 10% is bad.
Churn Rate = lost customers / total customers at the start of time period * 100
CLV
Customer Lifetime Value helps to understand how much value a single customer will bring to the company over the lifetime of the relationship. It refers to the total amount of money that a customer is predicted to spend with your business. Based on this data, it’s easier to decide what kind of target audience a business should attract.
To calculate average customer lifetime value, you’ll need three metrics: annual revenue per customer, the length of the customer relationship in years, and customer acquisition cost (CAC). Next, simply multiply the annual revenue per customer by the number of years of the customer relationship and subtract the customer acquisition cost. The result is the average lifetime value of the customer.
CLV = (annual revenue per customer * duration of customer relationship in years) – customer acquisition cost
CRR
Customer Retention Rate or Customer Retention Index will tell you how successful you are in building audience loyalty. It shows the percentage of customers that the company has managed to retain over a certain period of time.
To calculate the metric, you need to know how many customers were there at the beginning and end of the period, and how many newcomers came in. It is closely related to the churn rate, but highlights what percentage of users are being retained.
To get the CRR, subtract the number of new clients from the total number of clients at the end of a given time period and divide that number by the number of clients you had at the beginning of the period. Then multiply by 100.
CRR = [(Number of clients at the end of the period – Number of new clients added during the period) / Total number of clients at the beginning of the period] * 100
Final thoughts
We won’t stop talking about the importance of analytics in affiliate marketing. If you think it’s enough to analyze only the cash flow and displays of your ads, then this article is a sign to reconsider your views. It’s not enough to understand what kind of offer you’re selling and to which audience you’re targeting. Building solid leads and loyal customers for your brand requires regular analysis of Voice of the Customer KPIs. Use our guide to key customer experience metrics and generate custom insights to improve your service or product.
