The Metrics That Matter When Evaluating Your Customer Service Efforts

customer serviceAmerican call centers are at the epicenter of the customer experience revolution.  Businesses can be made or broken based on how well their agents engage today’s savvier, more well-informed customers.  

But, to be sure, this is no simple task.  In a Harvard Business Review piece, Corporate Executive Board (CEB) researchers summarized common obstacles that can erode loyalty when customers engage service personnel:

  • 56% have to re-explain an issue
  • 57% have to switch from the web to the phone
  • 59% expend moderate-to-high effort to resolve an issue
  • 59% are transferred
  • 62% have to repeatedly contact the company to resolve an issue

Of course, we are all too familiar with the data concerning the failure or success of such these customer engagements:

  • 25% of customers are likely to say something positive about their customer service experience
  • 65% are likely to speak negatively
  • 23% of customers who had a positive service interaction told 10 or more people about it
  • 48% of customers who had a negative experience told 10 or more people about it

METRICS THAT MATTER IN EVALUATING SERVICE

As the data above suggests, it is imperative for organizations to understand how effective their service operations are in terms of creating a great experience.  Over the years, various metrics have taken center stage in helping businesses assess the value of their customer service efforts.

Two of the more established metrics include:

  • Customer Satisfaction Scores or CSat which measures how products and services meet or surpass customer expectations.  CSat is the oldest and most widely used metric in the customer service industry.  In fact, in a survey, 71% of senior marketing managers found CSat very useful in managing and monitoring the state of their business.  
  • Net Promoter Score asks the simple question “How likely is it that you would recommend our company, product or service to a friend or colleague?”  Promoters of NPS believe it is the clearest and most direct way to measure customer loyalty.

In recent years, however, a new metric has entered the scene: Customer Effort Score or CES

When it emerged in 2008 behind research from the U.S. Corporate Executive Board, CES challenged the notion that companies “must delight” customers and argued that what customers really want is to simply be given a satisfactory solution to their service issue.  Or, put more simply, customers are best served when companies remove the obstacles to simple solutions.

IS CES THE ANSWER?

The concept of assessing customer effort was given a major boost when HBR published the aforementioned article in 2010.  Based on a study of more than 75,000 customers, the team at HBR made the following conclusions:

  1. Exceeding expectations during service interactions had negligible impact on customer loyalty.
  2. Instead, customer loyalty was primarily the result of service interactions which minimized customer effort.
  3. In the customer service environment, CSat was a weak predictor of customer loyalty, NPS was slightly better, but CES had the highest predictive power.

The HBR study validated the research of the Corporate Executive Board and boosted acceptance of CES as a viable methodology for evaluating customer service.  But there are still many detractors who believe that CES has holes. 

In fact, a major study by Call Center Helper challenges the findings published in HBR:

  • It is difficult to find out how “customer effort” is measured.  For example, the CES study glosses CE as “helping them (i.e. customers) solve their problems quickly and easily.”  In doing this they confound effort (“easily”) not only with speed (“quickly”) but also with resolution (“solve”).
  • No information was provided about how customer effort was measured in practice.
  • The paper did not report any data and gave no details of the results of their statistical analyses, thus calling into question the validity of their conclusions.
  • Loyalty had been defined as a combination of repurchasing and increased spending.  But in practice, loyalty was simply measured by asking customers what they thought they would do, which is clearly not the same thing at all.

The truth is that these are all valid means of assessing your customer service engagement.  If, for example, you run an American call center, you should try to minimize the customer’s effort in order to delight them and hopefully get them to promote your product or service.  That seems simple enough, doesn’t it?

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RDI Corporation was founded in 1978 and is headquartered in Blue Ash, Ohio. We provide precise business solutions through a fully integrated outsourcing model and our clients ranged from mid-sized corporations to distinguished Fortune 500 companies.