There’s an old saying in business: if you can measure it, you can manage it. But in the world of customer support, it can be difficult to quantify what feels like an issue of quality.
How do you measure how happy a customer is? How do you measure how well-liked a particular customer support quirk might be? While 72% of businesses believe they can use analytics reports to improve the customer experience, there’s precious little information online that tells you how to do that. KPI’s will help inform your support team how they’re doing.
That’s where identifying the right customer support metrics or KPIs (key performance indicators) comes in. If measurement does lead to better management, then investing in the best KPIs to monitor your customer support will inevitably lead to your improvement. That only leaves two questions. Which are the best KPI metrics to observe, and what can you do with these metrics once you’re ready? Let’s tackle them one by one.
The KPI’s:
- Average Resolution Time
- Customer Satisfaction Scores
- Speed to Reply
- Customer Retention Rate
- Cost Per Interaction
- Net Promoter Score
- Tickets Per Customer
- Six Honorable Mentions
KPI #1: Average Resolution Time
From the customer’s perspective, this may be the most important of all the customer service metrics. If a customer reaches out to you, they have a problem. The speed with which you adequately resolve that problem will not only affect how they feel, but how they feel about your brand—potentially for an entire lifetime.
That may be why 67% of customer churn is “preventable” if you resolve something the first time, according to some statistics. Think of average resolution time as a good “first impression.” After all, it isn’t just about speed. It’s about speed to resolution, which is the goal of any customer reaching out to you. Improving your ART means all sorts of good things about your customer service.
First, it means you’re identifying problems quickly. You can’t solve a problem if you can’t first diagnose it. Many customers are happy to wait patiently as you take care of something for them—but only if they don’t feel helpless. Higher average resolution time means that you’re not only accomplishing that goal, but you’re identifying problems quickly enough so customers feel heard. That may be why as many as 78% of customers are happy to do business with you again even if you’ve made the mistake that required resolution in the first place.
It also means you have adequate resources. To create a good average resolution time, you need the resources to respond to customers. You need a ticketing system. You need someone on your team willing to help out. You need an efficient way to assign those resources. Think of “average resolution time” as a good measure of the overall health of the entire customer support systems you have in place.
But while average resolution time is a good indicator of the overall health of your customer support, that makes it tricky as a KPI to optimize. But one way you can do it is by making sure you have the information handy to help customers better understand their problem by the time they’re getting in touch with you.
- Key takeaway: Invest in information. The more informed a customer is, the better it is for your average resolution time. This helps highlight the importance of a high-quality customer knowledge base. Is it easy to find the articles that can help them? Do your live chat specialists link to those instructions? Invest in high-quality information. Discover what your customers are most frequently struggling with, and build a database of customer support articles that will help them.
KPI #2: Customer Satisfaction Score
Want to know how well you’re doing? Just ask. That’s the idea behind the Customer Satisfaction Score. You gather the results from your surveys, add it all up, and find out what your customers are telling you when they’re anonymous.
Your goal? A customer satisfaction survey score of about 80% is considered a good benchmark in this industry. If it dips below that, it should immediately set off some alarm bells. But while it’s important to know that you do need to invest in your customer satisfaction, using a customer score as a KPI can feel a bit broad. How do you use it to make specific improvements?
- Gather a broad sample size. Two customers telling you that your customer service is 100% on-point might feel good, but it doesn’t actually tell you a lot about the service. Try to gather a broad sample size of ratings before you decide to take action.
- Direct customers to customer satisfaction surveys automatically. You’re not very well going to bring in a lot of customer surveys if your customers aren’t aware of them. Do everything you can to automate the process of sending out surveys. True, most people won’t fill them out—but the ones who do will give you plenty of invaluable feedback that will tell you where to make your improvements.
- Make your questions specific. Don’t just ask random questions and hope for the best. Isolate specific areas of your customer service—including some KPIs you might see on this list—and ask how you did. The more specific your questions, the more pointed the answers will be.
KPI #3: Speed to Reply (Or “Reply Time”)
In the 1950s, a restaurant was born that would revolutionize customer service metrics forever. McDonald’s optimized its entire kitchen to focus on uniform quality and speed, demonstrating that you didn’t have to cut corners in the end product’s strength to provide fast service to the customer.
It works the same in customer service. Just like cooking food, it might not sound like an area in which speed is always the top priority. But let’s consider things from the customer’s perspective. They’re frustrated because they can’t find an answer to something that’s gone wrong. They contact you. And the longer they end up waiting for you to answer, the more frustrated, helpless, and ignored they’re going to feel.
A faster Reply Time changes all that. True: a fast reply doesn’t automatically mean you’re going to create a better customer service experience. But it is going to let customers know that they’re valued. It is going to demonstrate that you’ve made a commitment to customer service. And it’s going to minimize the friction required to get in touch with your customer service.
One reason Reply Time is so valuable is that it makes your customer service approach more quantifiable. For instance, we know that about 46% of customers expect a response within 4 hours when they reach out to you. For your direct email customer service workers, that gives you a benchmark: are you going to hit on customer expectations, or does your average dip below what most customers want from you?
Then again, it’s different depending on who you ask. For instance, in the same survey, about 12% responded that they prefer a response within 15 minutes. If you offer live chat support and dip below a number like that, you’re only going to make life more irritating for your customers.
How can you use Reply Time to improve your customer service? Here are some ways you can go above and beyond those statistics and optimize your customer experience:
- Use your own reply time as a benchmark. After all, with customer service, you can’t improve unless you create a benchmark of some sort. And unless you have access to your competition’s statistics, you only have yourself to compare against. So feel free! Take an adequate sample of your average speed to reply and aim to beat it in the next quarter.
- Remember to keep Reply Time in context. Three hours of waiting for an email response going to feel different than a 10-minute wait via live chat. In the former case, a customer might feel perfectly patient. And in the latter, they might be screaming for some help. Keep your Reply Time in context and remember to focus on improving specific RTs relevant to the area of customer service you want to get better at.
You might also hear this one as “First Response Time.” But it’s essentially the same thing: your First Response Time is how long it takes you to reach out to a customer after they’ve initiated a new interaction.
KPI #4: Customer Retention Rate
It’s really the elephant in the room: customer service is all about results. And one of those key results in keeping customers happy. Sure, you can measure the feedback of your individual customer support stories…or you can look at the actual behavior of your customers and see if they keep returning.
Enter the CRR, or customer retention rate.
It can sometimes be difficult to quantify how many customers stick around because they’ve had a great customer experience. But it’s still a KPI worth the investment. Some statistics suggest the average global value of a customer is $243, however. And considering that your own industry may have higher lifetime values for customers, it goes to show how worthwhile it is to invest in good interactions with your customers. The happier you can keep them, the easier your customer interactions will be in the future.
The actual value of your CRR comes down to the process you use. Here’s the way to calculate it:
- Determine the number of customers you end up with after a process in your funnel.
- Then subtract the number of new customers you acquired during that same process.
- Take that new number and divide it by the customers you started out with.
Divided by 100, you now have a percentage for your CRR.
How does it work? Let’s imagine a scenario where we have nice, round numbers. For instance, let’s say that you launched a new text messaging campaign designed to build an SMS marketing list. You decided to measure CRR from the start to the end date of the campaign, about three months.
If you ended up with 50,000 total customers but acquired 10,000 customers through the new campaign, that gives you an end result of 40,000 customers. But if you started the process with 45,000 customers, it means you lost some along the way. Running the formula, you’d find out that your retention rate was 88%, and that you lost 12% of customers during the process, even though you ended up net higher because of the new campaign.
It sounds like a lot of math, but it’s worth doing. It gives you a gauge for what to expect when you launch a campaign like that. It also creates a KPI benchmark which you can then use to measure the success and customer retention rates of new campaigns in the future.
Keep in mind that you don’t have to apply this to campaigns only. You can always apply CRR to get a sense of how many customers you’re holding on to. For example, you might only examine one quarter’s worth of your sales to get a sense of how many customers you kept. Or you might run a yearly number to provide a bird’s-eye view of your customer retention. Either way, you’re putting a number on perhaps the most important metric of all: what your customer service does to keep customers on your side.
KPI #5: Cost Per Interaction (Or Cost Per Conversation)
One of the more important KPIs on this list, your CPI or CPC, depending on how you phrase it, will determine how much money you’re spending on customer support—and whether it’s delivering you the results you want.
Ultimately, it comes down to whether you want to spend money on the results you’re getting.
The key here is to factor in all of the costs associated with having a customer support interaction with a customer. And they can add up. Consider everything that goes into helping customers:
- The time/labor of the customer support specialist who’s handling the issue
- Any costs associated with the infrastructure you’ve put into place, such as your live chat service
- The training and financial incentives you’ve invested into customer support specialists
The good news is that this can be an easy KPI to generate. Add all of these numbers up and you’ll arrive at the overall umbrella of the money you put towards customer support. You can then tally all of the customer interactions you had within a certain time frame. Divide the number of interactions from the total money invested and you’ll have an idea of what it costs every time you help out a customer.
How do you improve it? This is a KPI you should consider a cost-saving measure. In other words, you might look at CPI as an overall indicator of the health of your customer support team. If it costs you too much to resolve customer issues—or even engage with a customer at all—then it’s time to look at this KPI and ask yourself where you can save on costs.
KPI #6: Net Promoter Score
This is one of the most common and widely-used KPIs in use for any business, and for good reason. It comes down to one question: would a customer recommend you to someone else?
On the surface, Net Promoter Score might not seem like it has much to do with customer support. After all, it’s an evaluation of the overall quality of your company and your brand. Someone might not have had a customer support experience with you before, yet they could answer in the affirmative that they would recommend your product to a friend. Or someone might have had a positive experience with your customer support, but still say they wouldn’t recommend the product/service to someone else simply because they can’t think of anyone who would want it.
It’s a tricky way to look at things, but it is important in the context of customer support.
For starters, NPS is a good measure of customer loyalty. And customer support does tie in directly to how loyal people will be. You’ll hear it anecdotally: customers who had one customer support experience where a rep went above and beyond for them pledge their everlasting loyalty to that brand. And it can go the opposite way. Customers with a terrible customer support experience may swear off your brand forever, yielding a poor NPS.
According to Neil Patel, poor customer service costs an average of $83 billion in the U.S. in terms of lost customers. And NPS is a measuring stick that you can use to apply better customer support principles. Ask yourself the following questions as you evaluate your brand:
- Why aren’t people recommending you to others? We all know about the value of word-of-mouth marketing. But what is it about your brand that isn’t generating that kind of buzz? With a high NPS, you can be confident that people are recommending you to others, but if it’s low, then you know that you have some digging to do. Your next goal is to find the reason people aren’t rating you as highly as they could. Does it all come back to customer support? If so, you’ll know where to invest your next NPS dollars.
- Do people take action? One of the best ways to find out if your NPS really matters is to add another measure to it: find out how many customers really are recommending you to others. We all know that people don’t always report their own behaviors accurately on surveys.
KPI #7: Tickets Per Customer
Let’s zoom back into the customer support experience. Rather than ask big, bird’s-eye questions, you’ll need a better handle on how your customer support is actually working out for your customers.
The challenge with this is that unless you have another KPI in place—such as customer satisfaction scores—it can be hard to bring this down to a number. Tickets Per Customer changes that. It gives you a simple number that doesn’t require a complicated formula to generate. And you can look at that number and immediately tell if your customer support is where it needs to be.
Think of this one like golf. Ideally, in golf, you want to get a hole-in-one every time. That might not be realistic, but it’s certainly a benchmark by which you can measure your progress.
It’s the same for TPC. You only want one ticket per customer. It may not always be realistic—and sometimes the results might be out of your control—but it’s an immediate way for you to check up on your customer support efforts.
It’s a great metric, there’s no doubt about that. But like any great metric, it should be actionable. So how are you supposed to get actionable tips out of something like tickets per customer? You’ll want to look for fluctuations in volume.
- Are there certain periods of time during the day that generate higher TPC? If so, this is the time you might want to invest in. This can not only help lower your tickets per customer during so-called “rush hours,” but by targeting your resources at specific times of the day, you may even improve with other metrics on this list. You can also zoom out and look at times of the week, months, or even seasons in which you may have to put extra resources into customer support.
- Do certain products or websites require more tickets per customer? Now we’re closing in on what really matters. What is tripping up your customers? You can use this information to create help desk items that steer customers through your most common problems. Think of TPC as a good clue into what’s bugging your customers the most.
- Individual customer support performance. Do some customer support specialists average far lower TPC than others? This is where you get to evaluate beyond customer surveys to see if some customer support specialists are doing more to help your company—and your customers.
6 Honorable Mentions
- Average First Response Time (or First Reply Time)
- Average Handle Time
- Total Volume (of Tickets)
- First Contact/Call Resolution Rate
- Resolution Rates
- Churn Rates
That old saying in business is “what gets measured, gets managed.” And it’s true in customer support as it is anywhere else. And fortunately, if you know what KPIs to look for, you can take highly intangible ideas and turn them into genuine analytics and insight.
The only question is, what will you do next to make sure that your customer support is optimized, and that your agents and CSRs are working towards the right goals? If you take the time to turn these KPIs into actions, you can immediately begin creating a better reputation for your customer support offerings.
