How to Measure and Define Customer Service for Small Businesses
In today’s competitive marketplace, small businesses need to focus on delivering exceptional customer service. By understanding and measuring key metrics, businesses can ensure they are providing high-quality experiences that keep customers loyal and engaged. This article will explore how small businesses can measure and define customer service through the use of tools like Net Promoter Score (NPS), Customer Effort Score (CES), and Customer Satisfaction Score (CSAT).
Understanding Net Promoter Score (NPS)
Net Promoter Score (NPS) is a widely recognized metric that measures a business's performance relative to its competitors. According to NPS, customers are categorized into three distinct groups based on their responses to a single question: How likely are you to recommend our business to a friend or colleague?
Promoters: Customers who gave a score of 9-10. These are the loyal advocates of your business who repeatedly choose to do business with you and recommend your products or services to others. Well-run businesses aim to increase the number of promoters to fuel their growth. Passives: Customers who gave a score of 7-8. These customers are satisfied but are not particularly enthusiastic, making them vulnerable to competitors. It is crucial to maintain and engage these customers to prevent them from defecting to your rivals. Detractors: Customers who gave a score of 0-6. These are dissatisfied customers who may negatively impact your brand image through negative word-of-mouth. Minimizing detractors is a high priority for any business.Frederick Reichheld, a pioneer in customer service metrics, emphasized in The Harvard Business Review that building sustainable profit growth begins with fostering a greater number of promoters and fewer detractors. It is essential to keep a majority of your clients as promoters to drive business success. By identifying areas in your sales process that need improvement, you can develop your sales strategy effectively.
Measuring Metrics and Defining Customer Service
Measuring key metrics is only the first step; defining them correctly is equally important. For small businesses, it is crucial to keep customer effort low and satisfaction and loyalty high. Here are the key metrics to focus on:
Customer Effort Score (CES)
Customer Effort Score (CES) measures the amount of effort a customer has to put in to resolve an issue or fulfill a request. A low CES indicates that your support team is making customer service effortless, while a high CES may indicate areas that need improvement.
Customer Satisfaction Score (CSAT)
Customer Satisfaction Score (CSAT) measures the level of satisfaction a customer has with a product, service, or experience. It is typically measured on a 5- or 7-point scale, with a high score indicating a highly satisfied customer. Regular CSAT surveys can help you identify any pain points that need to be addressed.
Net Promoter Score (NPS)
Net Promoter Score (NPS) is a straightforward metric that helps you understand customer loyalty. By surveying your customers with the NPS question, you can gauge the likelihood of them becoming promoters or detractors. Regularly running NPS surveys can provide valuable insights into how well your business is performing relative to competitors and the market.
Best Practices for Small Businesses
At Kayako, we have compiled a list of key customer service metrics to help your support team deliver the best possible customer experience. Download our free cheat sheet to learn how to calculate these metrics and improve your customer service strategy. Additionally, following best practices from leading sales influencers can provide valuable insights and actionable steps for enhancing your sales stack.
By focusing on these metrics and following best practices, small businesses can improve their customer service and drive sustainable growth. Remember, the goal is to shift the majority of your customers into the promoter category, ensuring loyalty and positive word-of-mouth.