Using CSAT for Deeper Customer Insights

According to the 2020 Zendesk Customer Experience Trends Report, the pandemic has not made customers more forgiving. In fact:

• 75% of customers will spend more to buy from companies that provide a good customer experience.
• 50% will defect to a competitor after just one bad experience.
• 80% will switch after more than one bad experience.
• 50% say that customer experience is more important to them now than it was a year ago.

All these figures reinforce not just the importance of providing top-notch customer experiences but of listening to and understanding the voice of the customer. One way to understand customer sentiment is through CSAT (customer satisfaction) scores.

Overview: What is a customer satisfaction (CSAT) score?

CSAT is a metric used to assess how happy your customers are with a product they just purchased, a recent service, or a specific interaction with your company. It’s typically administered through a brief survey containing one or a few simple questions.

CSAT surveys can include a question such as, “How was your experience today?” followed by a few options, such as excellent, good, OK, bad, and awful. Each option corresponds to a number on a scale. Another oft-used question is “How satisfied were you with ?” followed by these choices:

1. Extremely dissatisfied (or very unsatisfied)
2. Somewhat dissatisfied (or unsatisfied)
3. Neither satisfied nor dissatisfied (or neutral)
4. Somewhat satisfied (or satisfied)
5. Extremely satisfied (or very satisfied)

You can think of CSAT as a quick peek into the mind of your customer. An interaction that seems to have gone well may not actually be all that well because the client may be hiding their disappointment behind a façade of politeness.

When given to a number of customers, a CSAT survey and the corresponding CSAT score can remove the veil shrouding your customers’ feelings toward a particular product, service, or procedure your company is providing.

CSAT vs. NPS: What's the difference?

The biggest difference between CSAT and NPS (net promoter score) is that CSAT is designed to obtain a snapshot of short-term customer satisfaction or loyalty, while NPS focuses on evaluating customer happiness and loyalty over the long term.

CSAT gauges the here-and-now satisfaction of the customer, while NPS assesses how the number of promoters compares to the number of detractors plus those who are passive or not taking a position.

A promoter is someone likely to recommend your company, while a detractor is someone who is unsatisfied and may even tell others not to do business with your organization.

How to calculate your customer satisfaction (CSAT) score

To calculate your CSAT, take all of the positive responses to the survey (the two highest values -- 4 and 5), divide them by the total number of responses, and then multiply the result by 100.

(total # of positive responses / total # of responses) x 100 = CSAT %

So, if you sent a survey to 80 people, got 60 responses, and 50 of them were positive, your CSAT would be 83% ((50 / 60) x 100 = 83.33%).

If you use cloud-based survey tools or customer service software, CSAT can automatically be calculated for you.

Should you use the customer satisfaction (CSAT) score for customer surveys?

CSAT surveys are useful tools for learning what you want to know about your customers, such as how satisfied they are with a purchase or trial, the customer support they receive, or specific aspects of the products or services you offer.

Depending on your objectives, other questions you may ask in your CSAT surveys include:

• Demographic questions for when you want to segment your customer/lead database
• How customers are using your products
• Open-ended questions that allow them to freely express how they feel about your company and other relevant feedback

Sending out CSAT surveys to discover how customers perceive your company’s products and services is an invaluable way to gain insight into what your customers are thinking. It can also help you evaluate new and existing strategies that will allow your company to provide better and more effective solutions.

Advantages of using CSAT

There are several reasons why CSAT is one of the most popular customer service metrics organizations use, alongside NPS and customer effort score (CES).

It paves the way for communication

Often, when a customer picks up the phone, navigates to your website, or initiates a chat with your service representative, they want something resolved or a question answered. With a CSAT survey, you have a window with which to see whether that has been done to their satisfaction.

A negative or neutral response can be a useful flag, alerting you to a customer who’s not particularly thrilled with your company’s product or service. You can then reach out to the customer to understand what’s causing them to be unhappy.

It helps retain more customers

Satisfaction often breeds loyalty -- so does communication. With the CSAT, you get a bit of both worlds. You can verify satisfaction while initiating communication, both of which are key components of many organizations’ customer retention strategies.

As customers engage with the survey, they may feel you respect their opinion and want to use it to improve. This elevates your organization from merely providing something and taking money for it to one that is invested in their feelings. They may return the favor by buying more of your product or service.

It boosts brand image

You can use CSAT to identify policies and practices that create happier customers and then replicate those. Doing so will likely generate more happy clients. As they talk about your company, whether to their friends, family, and colleagues or in an online review, they’re spreading the good word about your organization, strengthening your brand’s image and reputation.

Disadvantages of using CSAT

Although CSAT is a helpful tool for those trying to figure out how to improve customer service, it does have a few limitations. It is open for misinterpretation, which may end up hurting your customer service efforts instead of helping.

Results reflect short-term sentiment

Because a CSAT score is based on how customers feel at a particular moment, CSAT feedback only provides data for a relatively small window of time. The same customer can have the exact opposite sentiment toward your brand the following day.

Results can be skewed by cultural biases

Studies show that the way people respond to customer satisfaction surveys differs according to their culture. People from countries like the United States, which values individualism, are more likely to select choices on the extreme ends of the spectrum.

For example, if given the choice between terrible, bad, average, good, and outstanding, Americans are more likely to choose “outstanding” or “terrible.” On the other hand, people from collectivist countries -- where the needs of the group outweigh those of the individual -- are more likely to select a moderate response, such as “bad” or “good.”

Therefore, an organization may have to adjust the CSAT survey choices based on the target demographic or interpret them differently depending on customers’ cultural backgrounds. Only then can the information prove useful if your aim for conducting CSAT surveys is to elevate your customer service standards.

Results may not correlate with customer loyalty

“Happy” doesn’t always equate to “loyal.” A customer coming back again and again demonstrates loyalty, while a positive reply on a CSAT survey may only mean the customer is satisfied in that moment and on that day.

In addition to repeat customers, you also want clients to promote your brand and sing your praises to people they know or in an online review. This way, they can inspire someone else’s customer journey. However, just because a customer provides a positive customer satisfaction rating today doesn’t mean they will become an ambassador for the brand.

Putting CSAT to work

CSAT, as a metric, points to how well you’re keeping your customers happy. When used properly, it paves the way for better communication, lets you retain more customers, and boosts your brand’s image. However, the results may only indicate short-term customer sentiment and can be influenced by cultural biases.

And because CSAT does not necessarily correlate with customer loyalty, you are more likely to obtain better information when combining it with other metrics, such as NPS.