Moving Beyond NPS: Customer Experience Management Metrics for Hospitality, Retail, and Financial Services

Leading hospitality, retail, and financial services brands are going beyond NPS with these better and more complete customer experience management metrics.

You know the saying, “You can never have too much of a good thing”? Well, turns out that doesn’t apply to Net Promoter Score℠, or NPS®. Once the preferred metric for measuring customer experience (CX), it’s beginning to outlive its usefulness. 

Even the founder of NPS, Fred Reichheld, is tired of the over-use of NPS surveys. For one, perfect scores have become meaningless as consumers increasingly feel pressured to give courtesy 10-out-of-10 scores. For another, it’s getting harder to get good survey response rates. And far too many brands simply haven’t acted on the insights their NPS surveys have uncovered.  

So what are savvy CX teams doing now? They’re moving beyond using NPS as a standalone KPI, and focusing on the metrics that executives actually care about. A range of customer experience management metrics can reveal a more complete picture of the omnichannel customer experience and the impact CX strategies are having on important business outcomes. 

To learn more about how leading brands in key sectors are approaching customer experience measurement, we connected with Medallia’s CX advisors for the hospitality, retail, and financial services industries. Ahead we’ll share their insights into the state of NPS and the essential customer experience management metrics brands need to start paying attention to.

Jump to: Hospitality | Retail | Financial Services

The CX Metrics That Really Matter for Hospitality Brands, Retailers, and FinServ Companies

The state of NPS in the hospitality industry 

While NPS has long been a go-to KPI for assessing customer loyalty and advocacy for hospitality brands, in recent years it has become a victim of its own success. 

“CX teams have become obsessed with achieving higher NPS scores. Instead of focusing on what really matters — improving the underlying customer experience — they’re chasing better numbers,” explains Geoffrey Ryskamp, Vice President and Executive Advisor for Hospitality at Medallia, who has held management and operational roles with Hilton Worldwide, Marriott International, and more.

But this single-minded drive to boost NPS isn’t moving the needle. In fact, data from Forrester’s annual Customer Experience Index rankings suggests things are heading in the wrong direction altogether, with U.S. consumer perceptions of CX quality dropping steadily since 2021 and hitting an all-time low this past year. 

The best CX metrics for hospitality brands

“Put simply, over-reliance on a single metric, whether that be NPS or another KPI, provides an incomplete picture of the customer experience,” says Ryskamp.

For a more holistic view, hospitality brands should measure their success using a variety of CX metrics, incorporating critical outcomes, experiences, operational data, and qualitative insights. 

Outcome metrics

To link your company’s experience improvements directly to their financial results, track business KPIs like customer lifetime value (CLV), retention rates, churn rates, share of wallet, and acquisition costs. 

Experience metrics

To evaluate the customer experience, you can still use NPS surveys, but be sure to round these scores out with customer satisfaction metrics and customer experience KPIs like overall satisfaction (OSAT), customer effort score (CES), and journey-specific metrics, such as first contact resolution rate and booking completion rate. 

Operational data

Integrate omnichannel customer experience data from across the business — your brand’s website analytics, app usage, contact center data (such as wait times and resolution rates), and operational efficiency metrics.

Qualitative insights

Analyze unstructured customer feedback (online reviews, social media mentions, and contact center call transcripts) to understand the why behind your brand’s other customer experience KPIs, using thematic and sentiment analysis. Doing this will help you understand the drivers of loyalty and dissatisfaction.

The state of NPS in the retail industry

“Because NPS is widely used across retailers, it can be a useful benchmark. But by itself, NPS doesn’t paint the entire picture of the customer experience or help teams make smarter, more data-driven decisions,” says Mike Debnar, Vice President and Executive Advisor for Retail at Medallia, who previously led customer experience and digital innovation at 7-Eleven. 

While NPS alone won’t cut it, pairing NPS with other CX metrics that are simple and actionable can help stakeholders prioritize the right strategies to put in motion. 

The best CX metrics for retail brands

The following KPIs will help retailers better measure the customer experience and understand what’s affecting financial outcomes, consumer sentiment, and customer satisfaction, so they can optimize for the best results. 

Same-store sales, conversions, revenue

By keeping tabs on operational data, such as the holy grail of retail metrics — same-store sales — along with KPIs like conversions and revenue, brands will gain insight into what’s driving experiences and satisfaction for customers and financial outcomes for the business.   

NPS combined with impact scores

“NPS can help brands measure experiences to a degree, but in retail it’s all about the details and NPS is too blunt of an instrument to be valuable for operations,” explains Debnar. The real power of NPS scores is when they’re combined with Medallia’s Text Analytics impact scores. 

Our AI-powered Text Analytics is a key tool for analyzing customer experiences at scale — across channels and touchpoints — to understand what’s happening for consumers. Impact scores combine qualitative and quantitative analysis and reveal why a brand’s KPIs are going up or down, based on real-time customer conversations and sentiment. By using impact scores brands can identify their top CX drivers and link these directly to financial outcomes.

Customer satisfaction metrics

Retailers can gather customer satisfaction ratings about any aspect of the business, to get insights into how customers feel about the brand’s product assortment and quality, customer service, pricing, and more. Depending on your specific goals, you may want to focus on the top box scores — that is the rate of responses that indicate a consumer is “extremely likely” or “very likely” to do something — or the bottom box scores — the rate of responses that indicate the consumer is “not so likely” or “not at all likely” to do something. 

Other key customer signals 

In addition to tracking traditional CX metrics, retailers should bring together sales data, CRM data, and third-party data to zero in on strategies that can improve the customer experience, including changes that can be made to a brand’s product assortment, pricing, and promotions. 

The state of NPS in the financial services industry

Depending on the structure of a financial services brand’s CX team and what their strategic business priorities are, NPS may be the right metric to focus on.

“NPS is highly benchmarkable, making it an extremely popular primary metric in the financial services world,” says Judy Bloch, Vice President and Executive Advisor for Financial Services at Medallia, who has held customer experience leadership roles at Sprint, Citi, and UMB. “It’s best used as a relationship metric, to understand the impact of word-of-mouth referrals.”

Far too often, however, NPS gets used as a transactional metric, when that’s not what it’s intended for. Worse, brands end up using NPS to assess the health of their customer relationships and their transactions, and, when that happens, the two measures usually don’t line up. That leaves CX teams having to spend a significant amount of time explaining to senior leadership teams why these metrics aren’t aligned — leaving less time to resolve customer pain points. 

Instead of jumping straight to NPS as the primary metric, CX teams need to first start with the business problem they’re trying to solve and the strategies they’re implementing to make a difference. These parameters will help determine the right metrics to track to understand whether the actions that are being taken are delivering the desired results. For example, if a bank is highly focused on retaining deposits, the CX program should be designed to detect and prevent churn as well as drive cross-sell and up-sell potential, meaning these metrics (retention, cross-sell, and up-sell rates) would be important KPIs to track.

The best CX metrics for financial services brands

Depending on your organization’s business strategy and goals and the purpose of your customer experience management program, you may want to monitor metrics related to customer effort, acquisition and retention, and cross-selling and up-selling. 

Efficiency metrics

If your team wants to streamline processes for the customer and your employees, keep tabs on digital self-service usage, contact center volume, employee engagement, and customer effort scores to see if you’re serving clients efficiently and helping them solve their problems. 

Customer acquisition metrics

If one of your key business goals is to effectively manage the onboarding journey to ensure it is easy and seamless for new clients to become customers, you’ll want to pay attention to your  conversions and drop-off rates.

Customer retention metrics

As your team gathers and responds to your clients’ feedback and uses these insights to enhance your product offerings, eliminate friction points, and proactively anticipate future needs, watching metrics like churn and retention will help you evaluate the success of your efforts.

For B2B financial services teams focused on retaining contracts, monitoring accounts’ “likelihood to renew” can serve as an early warning sign as you work to drive renewals. 

If one of your business priorities is understanding how the contact center influences customer loyalty, retention, and advocacy, then Gartner’s value enhancement score (VES) may be a KPI of interest to you. VES is designed to measure the quality of a company’s service experience. There’s a strong correlation between high VES ratings and retention and financial outcomes — of consumers who rate their VES positively, 82% will be retained and 86% will spend more in the future, according to Gartner’s analysis. 

Cross-sell/up-sell rates

Keeping track of when existing customers expand their relationship with your brand — whether by adding on insurance policies, opening up additional bank accounts, or adding to their investment portfolios — will help you evaluate your success at becoming a trusted provider. 

Your Customer Experience Management Metrics Aren’t Complete If They’re Not Omnichannel

Companies with the best CX programs are moving beyond using single metrics like NPS to guide next steps and demonstrate the ROI of their efforts. Instead, they’re taking a comprehensive approach to measurement, connecting all of their most important customer experience signals to understand the complete omnichannel customer experience and how it shapes overall business value. 

Want to make the case for investing in customer experience and get buy-in for your efforts from your leadership team? Our infographic More Than Metrics: How to Prove the ROI of CX reveals how Medallia customers have used their CX programs to reduce churn, protect and accelerate revenue, lower customer acquisition costs, and maximize ROI.