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The Top 4 Customer Experience Metrics to Track (+Best Practices)

by
Megan Ross
Content Marketing Manager

Tracking customer experience is one of the most important functions of being a product manager. As you gather a greater amount of data and feedback across different customer personas, you’ll enhance your objective understanding of what users think your company is doing well and what can be improved. These insights help your company better meet collective customer needs, boosting user satisfaction and revenue. ​

However, you don’t want to just gather random user feedback and hope for the best. Otherwise, you’ll find yourself overwhelmed with a mountain of data points to sort through and prioritize. To maximize your time and deliver the most value to the most users, you need to be strategic about what customer experience metrics you hone in on.

We recommend using the following four metrics as your foundation to create a clearer picture of customer sentiment. By zeroing in on these key categories, you can easily pull out recurring themes and identify what initiatives will give you the strongest return on investment for customer satisfaction—the key to lasting sales growth.

1. Net Promoter Score (NPS)

An NPS tells you the likelihood of customers referring your product, with higher numbers showing a higher referral possibility. Users submit scores through surveys, and the results are broken into three categories: detractors (0–6), passives (7–8), and promoters (9–10).

While your average NPS is a helpful benchmark for customer engagement and satisfaction, the real value comes from gaining insight into why customers chose their specific rating. These direct explanations are crucial to developing an accurate conception of how to better serve your customer base. ​

Get the most out of NPS surveys with these tips:

Host NPS Customer Satisfaction Surveys on Multiple Channels

Post your survey across multiple feedback channels to mitigate response bias and get a better sense of how customers feel about your product. Let’s say you shared your survey with 100 customers, but only 20 people responded. If those 20 gave you a rating of 9 or 10, you’d have a high NPS score.

However, that low response rate leaves out 80 people who may have ranked your product much lower. This can make you think your product is doing better than it is, and customer problems slip through the cracks simply because you’re not engaging enough people. A multi-channel strategy will help you increase your sample size for better quality data.

Get Granular With Survey Follow-up Questions

Combine closed- and open-ended survey questions to dig into what people specifically like and dislike about your product and company. These targeted responses will give you a clear idea of what to do to improve customer satisfaction—which features you should promote, and which ones need to be adjusted.​

Consider asking customers to rate different categories on a scale of 1 to 5. Then follow up with open-ended questions that are based on the initial rating that was given. For example:

  • Promoters (9–10): What do you like best about our product/company?
  • Passives (7–8):  Are there any changes we could generate that would make you more likely to recommend us?
  • Detractors (0–6): What can we do to improve your experience?

In addition, briefly explain who receives customer feedback, how it’s applied, and how any changes your business makes will be communicated. This shows your company’s authenticity and responsiveness, which increases the likelihood that customers will respond.

2. Product-Market Fit

When your product resonates with your customer base, you’ll naturally bring in more revenue and new users. To make sure your product continues to meet evolving customer needs, you need to continuously assess your product-market fit.

As Forbes Councils member Andrew Constable writes, “The key to successful product-market fit is adding value for your customer.” You can determine the objective value you’re bringing to the table by tracking the following data points over time:

  • NPS scores
  • Market size
  • Growth rate
  • Profit margin
  • Company health
  • Customer retention rates

This consistent, data-driven approach will give you concrete insights into what actually moves the needle on customer satisfaction. The last thing you want is to pour time and effort into features that actually hurt your product-market fit and lead to customer churn. Our product-market fit measurement guide will teach you how to easily calculate these key data points.​

Product validation software is also helpful for continuously assessing your product-market fit. This tech allows you to gather feedback from end-users throughout the product lifecycle. Running things past customers in the planning, development, and launch stages will help you gauge your product-market fit and decide whether to move forward with a planned change or update. The more favorable the feedback is, the greater the product-market alignment.

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3. Customer Churn Rate

It’s impossible for a company to hold on to all its users forever. There’s life, there’s death, and there’s customer churn. While you can’t completely erase churn, you can minimize it by analyzing data from lost customers. This will help you identify red flags that signal risks of users leaving—signals that are based on fact and not guesswork. Then, you can proactively take steps to effectively address those issues and prevent more customer and revenue loss.

Identify Trends in User Pain Points

Instead of just looking at the total number of customers who churned, look at related data points, such as Annual Recurring Revenue (ARR) for each user that leaves. This way, your churn rate will account for factors like different pricing plans and will accurately convey the impact of churn on the bottom line.

Start by looking at user churn over the past month to pull out themes, then increase it to quarterly churn to see if those initial trends still come up. It’s important to look at both demographic and behavioral data points so you can get a better understanding of how user pain points vary.

​For example, you might notice a pattern where most Gen Z users who churned had a period of shorter app sessions or opened fewer emails toward the end of their customer journey. Perhaps you additionally found that last quarter, after you launched two-factor authentication, 10% of your baby boomer users churned.

​Both findings would be beneficial to share with Sales and Marketing, so you’re all on the same page about what’s driving users away and what can be done to remedy it. To solve churn in the above examples, you might send a discount email after a certain period of shorter sessions and ask Marketing to design an FAQ webpage on how two-factor authentication protects users.

Help Sales Target the Most Valuable Prospects

Churn analysis can also educate Sales on which prospects they should and shouldn’t target. It costs much more to obtain new customers than to keep them, so Sales should prioritize prospects who will spend and stick around.

​Back to our Gen Z users. Say you find that Gen Z customers account for most of your churn and only spend in the first few weeks after signing up—when discounts are the most prevalent. Why would it make sense to continue trying to build that audience when you can see they’re only in it for the initial deals?

4. Customer Renewal Rate

On the opposite side of customer churn, there are customer renewals. High renewals mean your customers are staying satisfied with your product over time—and these long-term customer relationships are at the core of company growth and success. As CSM Practice CEO Irit Eizips notes, “SaaS companies with high renewal rates can generate a regular, predictable recurring revenue stream more efficiently.”

What to Do When Renewals Are High

If your renewals are up, your company is doing a solid job of meeting customer expectations. Congrats! Make the most of this time by having Sales and Marketing connect with satisfied customers to ask why they renewed. When they can nail down what people love the most about your product, they can increase the likelihood of adoption by intentionally highlighting those sticky features for prospects. These insights will also help you with developing future products, which will set you up to drive customer growth from the jump.

What to Do When Renewals Are Low

Decreases in renewal rates should set off alarm bells in your head that something about your product isn’t working for users. Identify changes to your product that happened during the period of time when renewals started declining. You want to think about all changes small and big, from UX design tweaks to pricing model updates. Then, comb through subscriber feedback from that same time frame to see if there are negative comments connected to those updates.

​It’s also helpful to loop in Sales and Support to make sure you’ve covered your bases. As customer-facing teams, they’ll be able to offer valuable insight into any qualitative trends they’ve seen among users that may not be reflected in your customer database.

CX Metrics Are Key to Solving the Customer Satisfaction Puzzle

When you base your product decisions on concrete data and customer feedback, you’ll be able to more effectively meet user needs. In turn, you’ll see greater customer satisfaction and revenue as well as longer retention. As you continue to hone your data analysis skills, you can track more user KPIs and deliver even more value.

UserVoice Discovery is a scalable solution that offers real-time visibility into customer feedback data. This helps you objectively determine what’s working and what isn’t and benchmark your progress. Sign up for our free 21-day trial and see how these insights can help you transform customer experiences and your bottom line.