Businesses should love their customers. After all, without customers there would be no business at all.
And yet many businesses are failing to measure the performance of their customer service team, and they just assume that everything is fine. Closing your eyes to the impact of customer service is a surefire way to accelerate business failure and losing the customers you already have.
“Although your customers won’t love you if you give bad service, your competitors will.” – Kate Zabriskie
That’s why customer service performance metrics are a key way for businesses to find out how they stack up against the competition and whether their support is improving over time. What you measure actually matters. 90% of customers use customer service as a factor when deciding whether to do business with a company.
And after all, customers will very rarely tell you when something has gone wrong. They will simply take their business elsewhere and potentially spread bad reviews about your company to others.
It’s this alarming thought that should motivate your business to measure customer service performance with metrics.
See for yourself
What are customer service metrics?
Customer service metrics are indicators that help customer service teams track whether their service is hitting the mark and whether agents are empowered to do their jobs. The best customer service metrics give insight into performance and may reveal how performance has changed over time.
For your customer service performance metrics, you will want to choose an aspect of customer service that is important to you and your customers, such as speed of response. It’s well-known that customers value fast service, so a powerful metric to measure would be Average Response Time.
Instead of relying on guesswork or intuition, customer service performance metrics are a clear indication of success or failure.
The right customer service metrics should focus on areas that you want to improve or are evidence of service quality. They should be tied to tangible results that relate to customer satisfaction and happiness, rather than business priorities such as cutting the cost per interaction.
The importance of customer service metrics
Customer service metrics are so important for your business because they help you to improve your performance over time. Let’s drill down into the specific benefits of customer service metrics now.
Increases customer satisfaction
When you understand which actions your business is taking to meet customer needs, customer satisfaction is raised. For example, you can find out that your overall ticket resolution rate is 80%, which shows room for improvement. This could indicate that some customers had problems that were too complex to be solved by your support team, and you need to devote more resources to tackling them.
Improves agent performance
When customer service metrics are falling short of the standards you have set yourself, this is the prime time to intervene and find out which agents require more help such as training and professional development. For example, if customer tickets are taking a lot of time to solve (Average Resolution Time) you can deduce that your agents aren’t well-equipped enough to help customers in a timely fashion.
Raises agent morale
If agents are regularly measured on their performance using customer service metrics, this holds them accountable for their work and highlights areas that have been improved. When agents can track progress and celebrate success this makes them more engaged in their work, because they feel like someone cares about the outcome.
Grow customer retention
If you measure the impact of customer service you can use the results to grow customer retention overall. Happy and satisfied customers are more likely to return and purchase more products and services, and they know that your business values them. 89% of customers are likely to make another purchase after a positive customer service experience.
Top 8 customer service performance metrics
1. Customer Satisfaction Score (CSAT)
The first customer service metric you’ll want to consider is Customer Satisfaction Score (CSAT). This metric directly tells you how satisfied a customer has been with a recent service experience. This is important, since 72% of customers will share a positive experience with six or more people.
CSAT is a good indicator of overall customer service quality, and it is the customers themselves who are sharing their feedback on their experiences. Measuring customer satisfaction can get you feedback on the organization as a whole or rating a specific agent.
Customers who are satisfied are more likely to purchase your products and services again, because they know you will provide them with a good experience.
How to measure: CSAT is measured by sending out a survey to customers asking something like: “How satisfied were you with your experience today?” You then ask customers to rate their experience on a scale of 1 to 5, with 1 being very unsatisfied and 5 being very satisfied. Finally, you divide the number of satisfied customers (4-5) by the total number of responses and then multiply the result by 100. You’ll find the percentage of satisfied customers and therefore your CSAT score.
2. Customer Effort Score (CES)
Customer Effort Score (CES) is another customer survey that helps you find out how easy it was for a customer to complete an interaction. Customers appreciate it when you value their time so this metric shows that you have made their experience quick and simple. For example, instead of making customers wrestle through different options, you can provide a direct line to your customer service team.
Customers who have easy experiences are likely to remain a customer in the future and develop customer loyalty. Having a simple question and receiving a timely answer is a surefire way to retain your customers and have them raving about your business.
Make it easier for customers to access support rather than defecting to your competitors.
How to measure: To measure CES, you need to ask your customers a question like “How easy was it to complete your interaction today?” They’ll rate their answer on a scale of 1 to 5, with 1 being very difficult and 5 being very easy. You then take your customers who rated their experience as easy (4-5) and divide it by the total number of survey respondents. Finally multiply by 100.
3. Self-service usage
Sometimes, the best customer service is no service at all. 81% of customers attempt to solve issues themselves before reaching out to a customer service agent, making this their preferred way of accessing support.
A self-service knowledge base or chatbot can be vital resources that take the burden off your customer support team, enabling them to focus more on complex issues rather than commonly recurring questions. Self-service is a powerful way to keep costs down while maintaining a high standard of service.
How to measure: Measure this metric by finding out the number of customers who access self-service resources, divided by the total number of customer inquiries. Multiply by 100 to find out your self-service usage.
Average Response Time (ART)
How long it takes your company to respond to customers is a critical measure of customer service. 90% of customers rate an “immediate” response as important or very important when they have a customer service question, making Average Response Time (ART) one of your most valuable metrics to track.
Customers appreciate it when you get back to them quickly, especially when you’re offering instant channels like live chat. If a customer calls your business with a complex issue, try to avoid keeping them on hold. Keeping Average Response Time low means ensuring your team is adequately staffed for busy periods.
How to measure: Take the total time of all your responses and divide by the total number of responses sent by your support team.
4. Negative Review Rate (NRR)
Negative Review Rate (NRR) is the direct opposite of CSAT score. It’s the number of customers who have given your service a negative review. Your NRR tells you when customers have had bad experiences with your company, and enables you to correct them.
Customers who are unhappy can be your greatest source of learning, and they certainly deserve your attention.
It’s important to pay attention to these unhappy customers as they could spread bad reviews about your business far and wide. NRR may relate to your customer service team as a whole or an individual agent. Sometimes, you won’t be able to control the factors that lead to these negative experiences, but you may be able to offer customers some compensation.
How to measure: Take your CSAT rating for your customer service team or agent and find the inverse. So if your CSAT is 75%, your NRR will be 25%.
5. Ticket volume
You’ll want to know ticket volume for adequate staffing, as relates to your busiest periods during time of day, seasonal variations or new product releases. This metric is crucial because it affects other metrics like Average Handle Time (AHT), First Response Time (FRT) and Customer Satisfaction Score (CSAT).
Customer service agents who are overwhelmed with tickets won’t be able to deliver the highest standard of customer service possible and are likely to experience low morale in their jobs. Increasing ticket volume may also indicate a problem with your products or services which is an issue you need to address.
How to measure: Track the number of tickets you receive during different time periods and identify your busiest times.
6. Tickets solved
90% of customers consider issue resolution as their most important customer service concern. No matter the reason customers get in touch with you, they want their issues to be resolved. It can be nice to provide them with an explanation for the problem, but ultimately customers care about finding a solution and moving on with their day.
This is an important metric to measure because unfortunately, not all issues can be solved. You can increase this metric by providing your agents with the proper training to enable them to handle the majority of customer issues.
How to measure: Look at your total volume of tickets and take the total number of tickets solved in a particular time frame, such as a day, week, or month.
7. Average Resolution Time (ART)
Average Resolution Time tells your team how long it takes to resolve the average issue. Speedy resolutions are important for customer satisfaction, making this an important metric to measure. Customers would rather spend longer interacting with your support team and arrive at an effective resolution instead of having a speedy interaction that doesn’t get solved.
To keep Average Resolution Time low, agents need to be effective at resolving problems for customers.
A high ART for an individual agent may indicate that they need further training in how to support customers. A high ART for the whole customer service team may show that customers are running into complex problems that are difficult to solve. In this case, you can intervene to tackle problems at their root and relieve the burden on your support team.
How to measure: Take all the customer tickets and add up their total resolution time. Divide this number by the total number of tickets received to arrive at Average Resolution Time.
See for yourself
8. Customer Retention Rate (CRR)
Increasing customer retention rates can increase profits by between 25% and 95%. That makes Customer Retention Rate an important customer service metric to measure because your service determines whether customers will become repeat, loyal customers. It shows how many customers your business has retained over time, and demonstrates the success of your products and services.
It’s far easier to sell to an existing customer versus a new one. Existing customers already trust your brand and they know you provide great service, so they are more comfortable parting with their money. CRR shows just how crucial customer service teams are in providing business value.
How to measure: Customer Retention Rate is calculated using the formula [(E-N)/S] *100.
- S – the number of customers at the start of the period
- E – the number of customers at the end of the period
- N – the number of customers added during the period
Leading vs lagging performance indicators
Your customer service team will want to choose a mixture of leading and lagging performance indicators. The difference between the two is a simple one.
- Leading indicators tell you how your customer service team is likely to perform in the future, allowing you to guide the direction you want to take before the results become set in stone. An example of a leading indicator is Average Response Time, which tells you how long agents are taking to get back to customers.
- Lagging indicators take longer to measure and are an indicator of past performance. They tell you about the impact that your service has made on the customers and how close your organization has come to meeting its goals. An example of a lagging indicator would be Customer Satisfaction Score.
Leading and lagging indicators must be considered together to give a true picture of customer service performance. You’ll want to find out what you’ve achieved as well as whether you’re on track for future success.
Leading and lagging are involved in a constant interplay that reveals the progress you are making as a customer service department.
What are the best metrics for customer service?
The best metrics of customer service are ones that give you insight into customer sentiment, such as Customer Satisfaction Score. You may be delighted at having delivered speedy service, but is the customer happy with the resolution?
Customer Satisfaction Score gives you insight into how the customer is feeling, especially if you include a follow-up question to ask customers to explain their rating. Ultimately, it is the customer who decides if your service was a success, not your support team. CSAT helps you provide a better customer experience.
Customer Effort Score is also a good one because it tells you how easy you made the process. Customers are unlikely to seek out difficult interactions again because they view it as a waste of time and effort.
Ultimately, every customer service metric has something to reveal about the quality of service you offer your customers.
What are the best KPIs for customer service?
KPIs, or Key Performance Indicators, are a subset of customer service metrics because they are actual targets that your team is working towards. Metrics tell you where you stand right now whereas KPIs tell you whether you are on track to reach your goal. Naturally, a customer service goal must be SMART:
- Time bound
All KPIs are metrics but not all metrics are KPIs. A great KPI to measure is Average Resolution Time, because you can tell your team to aim for resolving the majority of customer issues within the time limit of one hour.
How is customer performance measured?
Customer service performance is measured by putting key metrics and KPIs in place that tell you whether you are moving in the right direction. You must identify your core metrics from the creation of your department to ensure that you have developed the right culture of accountability and you are driven by success.
It might seem like your customer service department isn’t directly tied to revenue, but that couldn’t be further from the truth. Customer service plays a vital role in retaining customers and securing word-of-mouth recommendations and reviews, so measuring the quality of service becomes even more important.
Therefore, you will want to track metrics and KPIs that will tell you whether you are on target to your revenue goals. Metrics that show the value of customer service to your organization are the ones you should be focusing on.
Focusing on one area to the exclusion of others gives an unbalanced picture of performance. Cover all your bases to gain true insight into customer service quality.
How do you monitor customer service performance?
Luckily, companies no longer have to monitor their customer service team’s performance manually. There are many tools available that can help you track metrics and also monitor change over time. You can generate daily, weekly, or monthly reports that give insight into your team’s successes and failures.
Use software like Keeping for tracking metrics such as First Response Time and Ticket Volume without manual intervention. You can save countless hours of busy work every week by taking advantage of Keeping’s advanced reporting features. Reports can be exported to a CSV so you can keep your business informed of agent and team performance.
Customer service performance metrics are an important way for your business to measure how well you are supporting your customers. They can tell you about past successes as well as plotting the course you should take in the future. Companies that track performance are better-placed to make improvements that result in happier, more satisfied customers.
No matter how small your customer service team is, tracking metrics from day one will set you up for customer happiness. Though it might be hard to initially look at the data and gain a true picture of your customer service quality, it will be worth it in the long run.
While customer service metrics are important, your customers are the true judges of whether customer service has hit the mark.
There’s always room for improvement, even in the best customer service teams in the world. The highest-performing customer service departments are always looking for ways that they can do better.