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Measuring Customer Experience in a Complex World

Measuring Customer Experience in a Complex World

Of course we know that “customer experience” is important — but how do we measure it? And how do we know we’re doing a good job?

The current approaches that most businesses adopt to measure customer experience can be limited. Surveys like CSAT & NPS don’t provide a full picture because they merely ask the questions “how was your experience with us today?” or “how likely are you to recommend us?” without a direct correlation with (and understanding of) the actual customer journey. To accurately measure customer experience, we need to establish what a customer did when they interacted with our brand, comprehend their journey, and understand how these relate to customer engagement.

No Two Customer Journeys are the Same

It’s not wise to assume that all customers have the same journey. When we consider the typically low levels of response Voice of Customer surveys receive, and how these often skew to focus solely on “poor experiences,” measurement can risk becoming assumptions made on assumptions. Some individuals will exhibit a very linear purchase journey with very few interactions, while others might have a more meandering experience that jumps channels and touchpoints – and they might move from online to offline and back again.

This is why measuring customer experience is so hard: no customer experience is the same.

In the past, the customer experience was declared either “good” or “bad” off the back of a survey – in fact, many companies still do this today. But this doesn’t provide insight into any friction a customer comes up against, or the most relevant moments for them in their journey with us. Each customer visit has a purpose behind it: they are researching, buying, and looking for answers – and how well we help them reach their objective is how we should be looking to understand the success of our customer experience.

What is Customer Experience Today?

A real customer experience is the sum of all the journeys a customer takes with our brand. Therefore, it’s not relegated to their experience within a single campaign or a one-time phone call. The holistic experience considers every interaction they have with our business and every engagement they undertake. And, if these are good experiences, a customer might engage more often and is more likely to purchase more than once (and fundamentally, recommend the brand). Customer experience drives customer loyalty, ultimately increasing a brand’s perceptional value, and the value its customers generate. Which means accurately measuring it is particularly important.

Why Measuring Customer Experience is a Challenge

Being customer-centric relies on delivering a great customer experience. But how can we measure our success?

We mentioned earlier that no two customers have the same experience, which can make this tricky. Consider also that different metrics are often owned by different departments: customer retention and loyalty metrics are marketing’s wheelhouse, while first-call resolution and CSI metrics belong to the customer service teams, and repeat orders are managed by the sales or marketing departments. This means that things can potentially get a little messy.

Measuring the success of our customer experience requires pulling together different metrics and combining that insight. This enables us to track it over time and identify where we need to work harder to improve the experience. Many of the existing and well-adopted measurements ask users to reflect on a recent experience they had with a brand. The customer has done something, and brands deploy Voice of Customer approaches to measure the experience. They then roll these up into macro scores and track this over time.

Customer Experience Measurement Metrics

Customer experience metrics fall into three broad camps: satisfaction, performance, and economic:

Satisfaction Measures

  • Net Promoter Score (NPS) measures the loyalty of customers to a brand. It is usually gleaned through a single survey question asking customers how likely they are to recommend the product or brand to a friend and takes an average from that
  • Customer Satisfaction (CSAT) Score measures how satisfied customers are with our products or services. It is measured through a feedback survey that asks customers to rate their overall satisfaction with the product or service they received
  • Customer Effort Score (CES) measures how easy it is for a customer to do business with us. Again, the average for this is taken from a feedback survey that asks customers how easy it was to work with or buy from a business
  • Customer Satisfaction Index (CSI) measures a customer’s satisfaction with our product, service, or brand. A CSI tracks customer satisfaction levels over time using a traditional survey format

Other measures look at how specific teams or service functions are performing. These are typically brand-centric, and don’t necessarily explain how a customer feels about the brand experience they just received.

Performance Measures

There are many of these, but to name a few:

  • Time to resolution: the average amount of time it takes a brand to resolve a customer service issue
  • First call resolution: measures the number of customer inquiries or problems that are solved on the first contact
  • Customer wait time: This may be page load speed, chatbot efficiency or call handling availability
  • Website effectiveness errors: Does the customer get to their intended destination?
  • Accounts opened: Considering all inputs

 Economic Measures

This measurement is more macro and business-orientated, but perfectly reflects the overall performance of a brand’s experience across the mass of customers. These are directly measuring the outcome of our customer experience.

  • Customer growth / acquisition rates: how many new customers we get over a set timeframe
  • Retention rate: the percentage of customers who continue to pay for a product over a set timeframe
  • Lifetime value: the total worth of a customer over their entire relationship with a brand
  • Churn: the rate at which customers stop doing business with a brand

Customer Experience Metrics Have Their Limitations

Each of these measures, though very different in approach, are data points that help understand how our customer experience is performing.

However, they do have limitations, since they don’t pinpoint the specific ‘experience’ pain that’s keeping our overall experience scores from going up. This can make it hard to improve the experiences we provide, while the measures are also broad in nature. To turn these data points into insights that are actionable, they need to be linked back to individual customers.

The value stems from their linking responses and behaviors to a measurable customer journey.

The Power of Behavioral and Customer Journey Measures

Once this connection is made, customer experience professionals can start to isolate what experience helped or hindered a journey and, most importantly, highlight where change can or should be made to drive an uptick in the experience across the board.

When we can link these measures to actual customer journeys, we can start to get answers from the data that have previously not been accessible. For example, we can dig into customer journeys where the CSAT was “poor” or “very bad” and see the specific customer paths and interactions that led to that score being given. Reviewing all the journeys of customers we retained month on month vs those that we didn’t, we ask what was different between the two cohorts – and what could we have done differently?

Customer Experience, how customers engage, and how they interact, are related – and tightly intertwined. Measuring how people engage across their journeys with a brand becomes a key factor in tracking the performance of the experiences we have delivered. Metrics include:

  • Journey Path Analysis: Analyzing the performance of key interaction paths within online and offline experiences. We must be able to track and measure online to offline flows: in other words, omnichannel.
  • Journey Completions: Move beyond just tracking conversions to measure a broader set of customer paths, including how well our ‘onboarding’ or ‘customer service’ journeys are performing. We can Identify and track these key journeys in the experience (those where customers depend on us), as these will make or break the value we provide.
  • Friction Analysis & MOT (Moments of Truth): This is where we identify interactions or pieces of content that are hindering users from reaching their goal, or what is positively supporting a customer reaching their objectives. Prioritize resolutions or the drive towards greater engagement.
  • Channel performance: Analyze and measure cross-channel behavior. High levels of channel hopping are often indicators of ‘experience friction’; an experience on one channel didn’t support the customer’s needs so to meet their goals, they sought assistance on another. Within this, paths from digital into agent-assisted (think call centers) are critical.
  • Length of Journey: This can be tracked in two ways; the overall time it took to complete a defined journey and the number of interactions required to reach a user’s ‘journey end’. Excessive visits, page views or time-to-complete are all indicators of a failing experience. Since customers often persevere, journey completions may be high, but it’s worth noting that if painful, return visits become less likely.

Our ability to delve into the different audience responses to see what they actually experienced, identifying the ‘bad journeys’ vs the ‘good’ ones, unlocks a brand’s understanding of its associated measures. These will be the springboard to create valuable and actionable insights.

Moving Beyond Surveys

Analyzing customer journeys means we are no longer limited to survey responders as a proxy for measuring customer experiences. Commonly, we find that survey responses are low and emotive, whereas actual journey data lets us understand what signals really matter in the delivery of standout customer experiences. For example, it can be helpful to review specific behaviors of all the customers that churned to establish what preceded the moment they stopped using our services. We can also ladder this up to cohorts.

A useful approach is to “move left” to measure what’s important: Move left of the end result (or the survey results) and keep moving left until we dig into the granular level of insights into a customer’s journey. Gone are the days of assessing metrics in isolation and leaning on tactics that only deliver data delay. Today, measuring customer experience requires real-time journey analytics, where each new interaction can veer a journey in a completely unique direction.

How to Measure Customer Experience: Engagement is Key

When it comes to customer experience, it’s all about understanding what is most important to our customers (and remember, this won’t be the same for every individual). This means that each time they interact with us, we can give them the best experience to meet their needs. It follows that value increases when this is achieved consistently over a customer lifetime.

Measuring the evolving customer experience, we need to consider the key customer moments:

  • How can I support them with their purchasing decision?
  • How can we help them in their moment of need?
  • Where are they in their lifecycle with us and what’s most relevant for them?

By understanding these key moments, we can fix them and make them better.

A Measured Approach to Measurement

There are many data points listed above that a brand must monitor and analyze to understand the performance of their customer experience. Each brand is slightly different and adjusting the measures to align most closely with our customers is key. They will give us a balanced and rounded view of our ‘experience’ health.

The key to unlocking the actionable insights is linking these data points with the actual experience’s customers have with our brand: their end-to-end journeys. Once we have omnichannel journey insights and analytical capabilities the treasure trove of insights is opened. We have factual data that shows what happened and why we received that terrible rating but, more importantly, we are no longer dealing with the small percentage of survey responders; we have all our customers’ data to hand.

When we know what’s working and what’s not, we can proactively engage. With Medallia Experience Orchestration, we recognize that each individual customer is on their own unique journey over time. The brand’s objective is to provide the greatest experience for every individual, acting in real time based on everything we know about them. In turn, customer experience measurement is nothing if it can’t turn this into actionable insight, designed to deliver perennial value.

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