10 Customer Service Metrics You Need To Measure and Improve

Improving customer service is vital to both your business and your bottom line. Companies today need to level up on their customer service if they want to stay competitive. According to a survey by Gartner, by 2016, 89% of companies expect to compete on the basis of customer experience compared to 36% four years ago. Great customer service is crucial to businesses because nearly three out of five consumers report that good customer service is key for them to stay loyal to a brand. 

As the battlefield switches to customer experience, you need to make sure that your customer service team is at their best when handling calls. This is where customer service metrics come in. Measuring these metrics will prove valuable to your organization because you might think that you are already providing the best but customers think otherwise. These metrics will help you determine customer service success. Without key performance indicators (KPIs), it would be hard to determine which areas you are doing well and which need improvement. 

  • Why Measuring Customer Service Metrics are Important 
  1. Measure Team Performance
  2. Boost Customer Satisfaction
  3. Increase Customer Retention
  4. Identify Areas For Improvement 
  5. Discover Areas of Excellence
  6. Satisfied Customers 
  • Customer Service Metrics To Measure
  1. Average Resolution Time (ART)
  2. First Response Time (FRT)
  3. Customer Satisfaction Score (CSAT)
  4. First Contact Resolution (FCR)
  5. Abandoned Call Rate (AbCR)
  6. Net Promoter Score (NPS)
  7. Average Handling Time (AHT)
  8. Average Conversion Rate (ACR)
  9. Customer Effort Score (CES)
  10. Customer Retention Rate (CRR)

Why Measuring Customer Service Metrics are Important

Before identifying the different metrics you need to measure, it is first worth knowing the importance and benefits of measuring your customer service KPIs. 

1. Measure Team Performance  

With customer service metrics, you will be able to measure the efficiency of how your team is handling service requests. It will give you an idea about the gray areas of your team and enable you to create improvement plans, schedule training sessions to achieve customer service benchmarks. 

2. Boost Customer Satisfaction  

Customer satisfaction is the end result of great customer service. According to Oberlo, 84% of customers say that customer service is a key factor in their purchase decision. Also, 95% of consumers consider customer service as important for brand loyalty. The more satisfied the customers, the more they will be loyal to your brand. 

3. Increase Customer Retention 

By aligning your products and services to the customer’s needs, you can keep them happy. As a result, they will choose not only to stay loyal but also become your brand advocates. When customers are satisfied with your service, they will gladly share their positive experience about your company. 

4. Identify Areas for Improvement

As a business owner, you would want to provide the best customer service possible. Armed with the right data, you will know exactly which aspect of customer service and experience you should focus on. Monitoring customer service metrics will give you an idea on which areas of customer service needs improvement. 

5. Discover Areas of Excellence

At the same time, customer service metrics will allow you to identify the areas where you are strong. The data you have collected will help you make informed decisions and process improvements.  

6. Satisfied Customers 

At the end of it all, customer service metrics will help ensure customer retention and loyalty. One negative experience will result in lost business for you. According to statistics by PwC, 32% of customers will walk away from a brand they love after just one bad experience. Your KPIs will help you map out a solid data-driven customer service strategy to help prevent customers from walking away from your company. 

Customer Service Metrics To Measure 

When it comes to great service, customers expect a lot from businesses these days. Customer service metrics help you generate graphs and reports but you need to convert these numbers into concrete action if you want customers to keep doing business with you. Here are 10 metrics you need to monitor to take your customer service to the next level. 

1. Average Resolution Time (ART) 

Average resolution time refers to the average time it takes to resolve customer issues. Also referred to as time to resolution or TTR, it takes into account the time elapsed from the time a query comes in to the time it is resolved and closed. Customers don’t have the luxury of time so they want their issues to be resolved as quickly as possible. 

It is important to resolve customer concerns as quickly as possible. According to Forrester, 45% of customers will abandon their online purchase if they can’t find a quick answer to their question. An increased average resolution time speaks volumes about your support team’s capability to handle more complex queries or a lack of coordination between the support team and those who assist with the handling of queries. 

To improve your ART, find a way to minimize the customer’s waiting time. There are many factors that contribute to an increased waiting time so assess and eliminate them to boost your average response time. For example, you can offer them self-service options like knowledge-base and AI-powered chatbots. 

2. First Response Time (FRT)

First response time refers to the time a chat was made by the customer and the response of the agent. Delays in the response time might result in lost business for your website. 59% of customers are more likely to purchase from your brand if you answered in less than a minute. Again, customers don’t have the luxury of time so connecting right away will greatly boost the customer experience. 

Customers have high expectations when it comes to responding to their queries. They wanted to be assisted the moment they called and made a query. It is one of the most important metrics that you should measure because to the customers, it means that their issues are being looked into and given priority. Also, FRT indicates the promptness of your team in addressing issues. 

If you can’t resolve an issue quickly, notify them that you have received their message to ease their anxiety of an unknown wait time. One remedy is to give them a link to your knowledge base to provide a quick resolution. When there is a temporary solution already, keep customers updated about the status of their concern.  

3. Customer Satisfaction Score (CSAT)

The end goal of customer service is happy customers. 96% of customers say that customer service is important in their choice of loyalty to a brand. It is another important KPI as it determines how satisfied a customer is with your service. CSAT is also known as happy customer KPI. This metric provides you an insight on what customers think about you.

The CSAT is a measure of your customer’s feeling immediately after interacting with your agents. To get your CSAT, you ask your customers to rate their experience with your support team based on a scale ranging from good to bad. Your scale could include regular numbers, stars, smiley faces, etc. The higher your CSAT is, the better your customer satisfaction.  

Acquiring a new customer is five times more costly than retaining a current one. This means that satisfied customers could lead to savings for your business. For your CSAT survey to be effective, research for the best survey question to ask customers.  Conduct the survey using different communication channels to get real-time feedback. 

4. First Contact Resolution (FCR) 

First contact resolution refers to are the tickets fully resolved within the first call? Data reveals that 33% of customers indicate that resolving their issues in one interaction is most important in good customer experience. Improving first contact resolution rate can help reduce your operating costs by 1%. The higher the FCR, the better. It means your customers are very much satisfied with your service. 

FCR can also provide a good insight on how good your agents are at understanding and addressing a problem without the need for several interactions. This can only happen when agents are not able to properly identify the issue and the solution is not accurate. A lot of time is wasted and will cause delays in fixing the issue. 

The first interaction is very important for every business. In reality, however, FCR is impossible because your support team will need more information to fully understand a question. In most cases, this will require sending a second email. In addition, customers will have some follow up questions. Still, you should work on improving first contact resolution to improve customer happiness and team productivity. 

5.  Abandoned Call Rate (AbCR)

This is another important metric that you should strive to improve on. Call abandonment is when the caller hangs up prematurely, either before an agent has addressed their concern or while they are being helped. Improving call abandonment rate contributes to the success of call center customer service and experience.  According to statistics, 7 in 10 customers will hang up out of frustration for long waiting times during a call without receiving custom support. 

Measuring this KPI will help you implement the right strategies for delivering effective customer support within a short period of time. When it takes a long time for customers to connect to an agent, it can become a frustrating experience for them. Although you should aim for zero call abandonment rate, it is unlikely because of various reasons. But keeping it between 5% – 8% is acceptable as it is the industry standard. Anything above that is already considered high. Studies have shown that call center abandonment rates reach as high as 20%.

Understanding customer expectations is key to improving customer satisfaction and reducing abandonment rates. The lower the abandonment rate, the more satisfied customers will be. 

6. Net Promoter Score (NPS)

The Net Promoter Score or NPS measures how likely customers will act as your brand ambassador and promote your products and services. NPS surveys can be administered via pop-up email. You ask the simple question: “How likely will you recommend us to someone else?” and the customer replies with a number between 0 to 10. Through the survey, you also ask for their feedback and follow up questions. 

The NPS will provide a better understanding of your customer’s perspective. The scale will tell you whether the customer is a promoter (9-10), passive (7-8), or detractor (0-6). Your Net Promoter Score is the percentage of promoters minus the percentage of detractors. NPS replies are less likely to be influenced by the customer’s mood unlike the CSAT, which targets the emotion. 

While it is just a loyalty metric, the NPS is closely associated with business growth. High responses means a higher level of satisfaction with your brand and the customer experience.  

7. Average Handling Time (AHT)  

Average handling time refers to the amount of time an agent would respond to a single inquiry. AHT includes the time they open a support email to the time they click send or from the moment they answer a phone call until the moment they hang up. Reducing a few seconds off handling time can contribute to big savings. 

According to a recent survey by live chat provider Velaro, 60% of people would hang up after being put on hold for a minute and 34% of those callers will not call back anymore. The same survey also said that ⅓ of customers believe that customer service departments should be answering immediately without any hold times.  

If there are long gaps in your team’s call handling, it may provide opportunities to improve processes, training, or providing the right tools to answer calls more quickly. You should be constantly optimizing and streamlining your processes for your agents. Find out what’s slowing your team down. 

8. Average Conversion Rate (ACR) 

The conversion rate refers to the percentage of users completing a desired action such as booking a demo or purchasing a product. The higher the conversion rate, the more successful your campaign is. Addressing conversion rate is crucial to your business growth.  

Statistics reveal that the average conversion rate is 2.35% but the top 25% have averages of 5.31% or higher. Ideally, you should be targeting to break into the top 10% which has conversion rates of 11.45% or higher. If you aren’t hitting the accepted conversion rate, then you need to work on it. 

To improve your ACR, you need to optimize your landing page headline. The better your headline, the more traffic you’ll generate. The landing page is where you need to make a good first impression. If your headline is not eye-catching already, then the other pages might not even get viewed. 

9. Customer Effort Score (CES)

The customer effort score (CES) is a measure of how much a customer must do to buy from your company. It measures the effort exerted by a customer to avail of your goods and services. The harder it is for them to purchase, the more likely they are to take their business elsewhere. Their willingness to go through all those difficulties speaks volumes about their loyalty to your company. 

The CES is also a survey that you can conduct with your customers rating their effort in completing a transaction using a scale of 1 to 5. Like the Net Promoter Score, CES is directly associated with customer satisfaction and business growth. You can use a Likert scale questionnaire to measure CES. 

Statistics from Gartner revealed that 96% of customers with a high-effort service interaction tend to become more disloyal compared to just 9% with low-effort experience. Examples of high effort include channel switching, repetition of information, generic service, transfers, and repeat interaction. While working on your CSAT, make it easy for customers to purchase from your company as well. Anticipate the next issue and implement preemptive measures to make it easy for them. 

10. Customer Retention Rate (CRR)

While acquiring new customers can help improve your brand image, focusing on your current customers is more critical than before. A study by Bain & Company revealed that even a 5 percent increase in customer retention rates can increase your profit between 25 and 95 percent. Improving your customer retention rate can lead to greater customer service experience. 

The CRR is the opposite of customer churn rate but both show the likelihood of customers sticking around. By delivering consistent and predictable customer service, you can look forward to a significant increase in the customer lifetime value. Keeping current customers satisfied is very important because 80% of future profits will come from just 20% of your current customers. 

So how do you increase customer retention? First, understand how your customers are feeling. By knowing their sentiments and interests, you can refine your approach and better meet their needs. You can use customer survey templates for gathering feedback but the most effective tool is the Net Promoter Score. Also, implement a customer loyalty program and reward them for their loyalty. 

Why Outsourcing Customer Support to airisX Makes Sense? 

By outsourcing to a leader like airisX, you will be able to scale up quickly by getting the right resources, processes and technological infrastructure. No matter what your scaling requirements are, airisX will give you the best optimised solution and you will be able to focus on delighting your customers. Your back office operations will be simplified, giving your users a high-quality experience.

GET IN TOUCH WITH US TODAY

airisX has solutions for all sizes and types of companies. Getting started is as easy as scheduling a consultation with us, so go ahead and