Customer Satisfaction KPIs

According to Salesforce’s State of the Connected Customer Report, 89% of customers are more likely to make a repeat purchase after a positive service experience. 

That’s why understanding the impact of service quality isn’t just important, it’s business-critical. In today’s fast-moving market where customer expectations shape every business decision, companies should stay closely attuned to the customer journey.

By keeping track of customer satisfaction KPIs (key performance indicators), you can identify pain points, improve service delivery, and ultimately boost loyalty and customer retention.

Customer satisfaction provides benchmarks for determining how successfully you’ve met the expectations of your target audience. Collecting feedback allows you to review these support metrics and identify touchpoints that require attention to improve the overall customer experience. 

The bottom line is that increased customer satisfaction equals improved sustainability and profitability. That’s why tracking key performance indicators for customer satisfaction is not just helpful, it’s essential. Let’s break down why they matter.        

Why Tracking Customer Satisfaction KPIs Is Crucial

Tracking customer satisfaction is essential for long-term success, as it provides measurable insights that help shape and improve support strategies. To maintain a high level of quality in customer support, monitoring key KPIs is crucial. These insights and the steps that you take based on them can lead to tangible outcomes.

Identifying Areas of Improvement

Some methods used to evaluate customer satisfaction, for example, a survey, help you understand how customers feel about your products or services. This feedback lets you build on your strengths and improve weaker areas.

Boosted Customer Retention

It is five times more expensive to acquire new customers than simply working to retain an existing customer. Not only does this make customer retention an actionable goal, but also a step towards improving loyalty. 

That being said, there are various customer retention strategies that your business can incorporate to help with retention, including personalized experiences, loyalty programs, and continuous engagement.  

Improved Customer Loyalty

It is earned when customers consistently choose your product or service – which is something that can quickly change. According to Ecommercefastlane, 45% of customers will switch to another brand if dissatisfied with the service they are receiving.

Reduced Customer Churn

This refers to the rate at which customers stop buying your products over time, which makes churn a crucial KPI for customer satisfaction.

Gaining a Competitive Edge

By setting your brand apart from the rest, your business gains a significant competitive advantage against similar companies in the sector. 

Top 6 Customer Satisfaction KPIs to Track

Customer satisfaction is essential, but knowing how to measure it is where many businesses struggle. The right KPIs turn vague impressions into actionable insights. Below are a few customer satisfaction KPI examples.

1. Customer Satisfaction Score (CSAT)

Broadly explained, a CSAT score measures a customer’s satisfaction with the company, products, or services helping monitor overall sentiment and pinpoint areas for improvement.

CSAT levels are typically determined through data collection via customer surveys that ask about their satisfaction with the experience.

CSAT can be measured through the following formula: 

CSAT = (Number of satisfied responses / Total number of responses) x 100 

The exact CSAT score that is considered to be within ‘successful ranges’ varies from industry to industry. An example of a good customer satisfaction score would be Amazon scoring a whopping 85% followed by Newegg and Costco with 83% respectively, as listed according to the American Customer Satisfaction Index. 

At SupportYourApp, we offer access to a CSAT survey analysis that provides actionable insights helping you optimize your support strategy and improve customer satisfaction. 

To improve CSAT levels, you can use these simple strategies.

By consistently applying these strategies, you can turn feedback into meaningful improvements. Over time, even small changes can lead to stronger customer relationships and higher satisfaction scores.

2. Net Promoter Score (NPS)

NPS remains one of the most popular customer satisfaction indicators used to measure customer loyalty, with one important question:

“How likely are you to recommend our business/product/service on a scale of 1-10?” 

Over time, NPS can help improve the customer experience as a whole by determining customer loyalty.  To calculate this value, split the scores into three categories:

• Promoters: 9 and 10 – these are the most loyal customers
• Detractors: 0 to 6 – those least likely to promote your brand 
• Passives: 6 or 8 – those who remain neutral in opinion but can become promoters in the future with some fostering. 

The score can then be determined with the following formula: 

NPS = % promoters – % detractors 

But how do you increase this score? NPS is something that needs to be worked on consistently to see improvement. Ways to do so include:  

• Act on customer feedback
• Introduce loyalty programs to encourage loyal customers to promote your brand
• Share NPS surveys regularly on your website or via other channels

3. Customer Effort Score (CES)

Another popular choice of key performance indicators for customer satisfaction is CES, which evaluates how easy it is for a customer to complete a specific interaction with your company. It helps identify friction points across touchpoints and improve the overall experience.

If customers find tasks like making a purchase or contacting support too difficult, they’re likely to drop off. Streamlining these processes not only improves satisfaction, it also boosts your CES score.

CES is usually measured through a post-interaction survey, where customers rate how easy the experience was on a scale from 1 to 10. The score is then calculated using the following formula: 

CES score = Sum of responses / Total number  of responses x 100 

According to a white paper listed on Precisely, 94% of customers who reported a low-effort experience said they intended to repurchase, showing that the easier it is to interact with a business, the more likely customers are to stay loyal.

4. Customer Churn Rate

Going hand in hand with CES, churn rate measures how well your company retains its customers, avoiding high “turnover” or “churn”. Logically speaking, the lower the CES, the lower the churn rate will be. 

Churn Rate = (Customers lost during a period / Total customers at the start of the period) × 100

A consistently low churn rate signals strong customer satisfaction and long-term brand trust.

5. First Contact Resolution (FCR) 

FCR leans heavily into the customer support side of the business, measuring how well customer support resolves issues the first time a customer makes contact. It can be calculated as follows:

FCR = Number of incidents resolved on first contact / Total incidents 

The faster the response time, the more satisfied the customer. High FCR not only improves satisfaction — it also reduces operational costs by minimizing repeat contacts and escalation.

A good way to ensure a high FCR is by outsourcing your customer service. At SupportYourApp, our consultants are experts undergoing regular training in customer support and effective issue resolution across channels so that your FCR will remain as high as ever.

Going hand-in-hand with this is the level of customer service your business provides — the poorer the support you offer, the less inclined consumers will be to do business with you or remain loyal to you. Determine what customer service level your business offers and how you can improve it.     

6. Customer Lifetime Value (CLV) 

How much value does every customer bring to your business? This can be determined by CLV which recognises every purchase a customer makes as an overall contribution to their total CLV  and can be calculated as follows:

CLV = Average purchase cost x number of purchases across the customer journey

A high CLV indicates a more regular and loyal customer, while lower value customers are often one-time purchasers who are lost to churn. Monitoring those values will not only increase overall revenue but also decrease churn over time. 

Customer Satisfaction Indicators and Business Performance 

Amid a competitive market, customer satisfaction is now a crucial concern and central to the success of any business. 

With customer satisfaction KPIs, you can assess how well your business is meeting customer expectations while also offering insights into future business performance outcomes. Such correlations include:

Revenue Growth and Customer Loyalty: satisfied customers are more likely to make repeat purchases, try new products and make recommendations to others all working in favour of spending less money acquiring new customers.  

Cost Efficiency: Happy customers are less likely to make returns, cancel services or call customer support. This translates into money saved in logistics, support and remarketing practices. 

Brand Reputation and Market Share: in today’s digital landscape, brand perception is shaped largely by customer experiences — positive reviews and word-of-mouth not only strengthen your reputation but also attract new customers. To make the most of these KPIs, businesses must integrate them into their broader strategy by:

• Regular data collection and analysis
• Cross-departmental integrations
• Benchmarking
• Adopting an attitude of continuous improvement

When used correctly, KPIs can be more than just metrics but strategic assets used to influence the bottom line of the business. 

Summary 

Customer satisfaction KPIs like CSAT, NPS, FCR, Churn Rate, CES, and CLV are powerful tools for understanding and improving the customer journey. When used effectively, they drive retention, loyalty, revenue, and overall satisfaction. What looks like simple data on paper can become the competitive edge your business needs in today’s crowded market.

FAQs

What KPIs Measure Customer Satisfaction?

There are numerous KPIs that work together to measure overall customer satisfaction — starting with the widely used CSAT score, followed by Net Promoter Score (NPS), Customer Effort Score (CES), customer retention, churn rate, and others.  

How to Measure Customer Satisfaction KPIs?

Customer satisfaction KPIs are typically measured through customer feedback collected via surveys after key interactions, such as purchases or support requests. Tools like CSAT, NPS, and CES use rating scales to quantify satisfaction, effort, and loyalty, turning qualitative experiences into actionable data. 

How Can KPIs Be Used to Improve Customer Satisfaction? 

KPIs turn raw data into measurable insights that can become actionable parts of strategic planning across numerous departments in the business and are particularly helpful in improving touchpoints in the customer journey.

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