Measure What Matters: Choosing the Right Customer Service Metrics

customer service metrics
Editor’s note: This article has been adapted from a video series recorded with customer service expert Bill Price, founder of Driva Solutions.

From net promoter scores to unorthodox customer support measurements, the world of customer service metrics is littered with options to accomplish the same universal goal: keeping customers happy. Companies that are positioned to succeed as customer-centric organizations place the utmost value on tracking customer satisfaction and support. How do you differentiate between trustworthy metrics from the ones that will distract or even lead you astray?

In the series of videos below, customer whisperer Bill Price, founder of Driva Solutions, OpenView Senior Advisor, and one of the top customer service experts around, gives you a number of tools and suggestions to tackle this important question and stay on track to keeping your customers happy.

Do You Know What Customer Satisfaction Questions to Ask?

Does your company know how to accurately gauge customer satisfaction? Most companies may have a general sense of whether or not their customers are satisfied, but they’re unable to produce detailed data that corroborates their beliefs. And that is a major problem.

Companies need to start actively reaching out to customers to ask questions that shed light on customer issues and customer satisfaction topics. At the end of a support session, ask your customer whether they would recommend your services to a friend. More importantly, have them quantify the quality of your support with a number. Then, use that number to determine exactly where your customer satisfaction stands.

“Customer satisfaction is everything,” asserts Price in this short video.

Without competent customer support, you will never be able to improve on your customer satisfaction. To that end, it’s time start analyzing your support processes, if you haven’t already.

Deciding Which Customer Service Metrics Work Best

With the immense range of metrics that are available, it may be difficult to separate the worthwhile numbers from the less meaningful ones. One of the most useful metrics is C/P=X. In this equation, C stands for the number of customer-generated inquiries that are submitted to a company. These are based on a motivating factor, which can be anything that causes a customer to contact a company — unclear invoices, questions about licenses, confusing manuals, or a range of other issues.

When a customer makes contact, it’s usually for the purpose of resolving their confusion. For this reason, you want to see less customer contacts because they directly correlate with their confusion and need for additional support. So for every motivating factor, you will likely receive a certain number of customer contacts, which is what P represents. The net result is X.

You want to see the X ratio reduced by tailoring your product management process, Price explains. In other words, your goal should be fewer customer contacts and less confusion that requires customer support.

Ignore the Averages

Instead of looking at your customer service averages — wait times, communication turnarounds, etc. — you should be looking at uncommon statistics. In this short video, Price explains that such statistics are far more telling than averages. It should be every company’s priority to look at outlying stats, rather than the averages, because the customers who experience these extreme cases need to be identified and the situations, rectified as quickly as possible.

“Forget about averages,” says Price. “What do I mean by that? All too often, in customer service and tech support, we talk about average handle time, average speed of answer and the average amount of time a customer has to stand in line or go through an email queue before getting a response. The critical thing from the customer point of view is not an average.”

For example, what was the longest amount of time taken to respond to a written communication? For those who had to wait this length of time, an apology (or more) should be in order. Ignoring extreme cases can be devastating to your customer service, says Price.

Measuring Your First Contact Resolution Rates

First contact resolution aims to monitor the rate at which a company resolves customer inquiries during the first point of contact. For example, if a customer support request is made online, that will be considered the first point of contact. If that issue goes unresolved and a second point of contact is made, whether it’s online or by phone, that’s a secondary point. This shows that the initial request wasn’t resolved during first contact. When exceptional customer service is part of your business growth strategies, you’ll need to ensure that such occurrences become infrequent.

To measure first contact resolution it’s imperative that you stay in stride with the customer as they move through the customer support process in your company. If they make an inquiry, you need to be able to identify when and where it happened, in addition to whether or not it was resolved. Without having this vital information, Price explains, companies miss out on a key glimpse into their customer service efficiency. That’s why actively monitoring and measuring first contact resolution is so crucial.

Real-Time Reporting and Customer Service Metrics

Having on-the-fly reporting and metrics in order to address customer service developments is a necessity for many customer-facing companies. Being able to resolve a serious customer complaint or listen to a helpful suggestion shouldn’t be a luxury. Price believes companies that have this capability can offer comprehensive and adaptive customer service.

“In a real-time in a support center, there are two or three metrics that are important to collect,” says Price in this short video.

Price discusses the value of an active backlog for customer queries, the importance of having an escalation pipeline that reaches supervisors in the event of a pressing customer matter, and other real-time reporting. Customer service data of this nature is often time-sensitive. That means addressing these matters quickly is of the utmost importance. Without real-time practices in place, that’s a daunting task.

Measuring Customer Loyalty: Calculating Your Net Promoter Score

In order to gauge customer satisfaction, Price advises that every company should be using a little-known metric called NPS, otherwise known as the Net Promoter Score. Through a medium of your choice, ask your customers a simple question: “On a scale of 1 to 10, would you recommend us to a friend?” You then take every customer who scored your company 6 or lower and subtract that from every customer who scored your company a 9 or higher (7s and 8s are neutral and can be ignored).

What you’re left with is a net percentage of how many customers would recommend your company versus those who would not. The best companies, such as Google or Amazon, typically score between 70 and 75 percent. There’s no reason why you shouldn’t be shooting for that star and actively making improvements based on your findings utilizing the customer service metrics listed above.

Bill Price founded Driva Solutions, a customer service consultancy, in September 2001. He also co-founded the 10-country LimeBridge Global Alliance and the 33-company Global Operations Council (GOC).

Prior to forming Driva Solutions, Bill was Amazon.com’s first Vice President of Global Customer Service, responsible for all customer service activities including managing the company’s contact centers in the US, Europe, Japan, and India. During these years, using the basic premises in this book, Amazon reduced its contacts-per-order by over 70% and also scored the second highest-ever customer satisfaction rating for any American company.

Before Amazon.com, Bill spent 20 years in customer care and services management starting at McKinsey & Company in San Francisco and Stockholm, as COO and CFO with Automated Call Processing Corporation, and later creating the MCI Enhanced Call Router (ECR) and MCI Call Center Services (CCS) divisions.

Bill has authored more than 20 articles and white papers, and the videotapes of his presentations with the University of Washington in 2002 and 2004 continue to be broadcast on television. In 1997 Call Center Magazine named Bill a “Call Center Pioneer” in its first annual award, and in fall 2004 he was asked to be one of the 10 global “CRM Gurus”.

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