Is your customer service up to snuff?
If you want to be more confident in the effectiveness of your customer service strategy, or if you want to improve the results from your customer service strategy further, you need to use objective data: customer service analytics.
But what types of data do you need to evaluate your customer service strategy?
And how do you measure these metrics?
I’m here to answer all your questions in this comprehensive guide to customer service analytics.
Table of Contents
- What are Customer Service Analytics?
- 7 Customer Service Analytics to Measure
- How to Use Customer Service Analytics
- Customer Experience Analytics vs. Customer Service Analytics
- How to Track Customer Service Analytics: Best Tools for the Job
What are Customer Service Analytics?
Let’s start with the basics.
What are customer service analytics and why are they important?
Essentially, customer service analytics is the process of gathering and reviewing specific data points related to your customer service strategy. You’ll review not only the performance of your own customer service team, but the outcomes of their interactions.
You’ll look at customer satisfaction scores, aggregated interaction data, productivity metrics, and dozens of other variables.
Why?
So you can learn more about how your customer service strategy is working.
To accomplish this, you’ll use a variety of tools to objectively measure specific elements related to your customer service strategy. We’ll cover some of our favorite tools in the final section of this guide.
The other important thing to note about customer service analytics is that your process has to be actionable. This isn’t an exercise in curiosity; instead of merely measuring and observing metrics for the sake of personal interest, you’ll be using them to inform and motivate better decisions.
7 Customer Service Analytics to Measure
These are some of the most important customer service analytics you’ll need to measure.
1. Average response time.
Average response time refers to the average amount of time it takes a customer service agent to respond to an inquiry, whether that’s a contact form, an email, a phone call via CX software, or some other medium.
As you might expect, the faster this time is, the better. If your average response time is too low, your customers are going to grow frustrated. Anything you can do to shorten average response time should increase customer satisfaction and boost efficiency at the same time.
Also, be on the lookout for outliers here; average response time gives you a high-level view of how your customer service department is responding, but individual interactions may vary.
How to measure average response time
If your team uses email to respond to customer inquiries, you can use EmailAnalytics to automatically measure email response time.
2. First contact resolution (FCR).
FCR attempts to measure your customer service agents’ abilities to resolve a customer question or concern on the first attempt. In other words, this estimates the rate at which customer inquiries are solved immediately. The higher this rate is, the better.
Customers want their issues to be resolved as quickly as possible, and the fewer attempts it takes to resolve the issue, the more efficient your customer service department is going to be.
How to measure FCR
Your customer service CRM should include this metric. See our list of the top customer service tools to find a CRM if you don’t already have one.
Most customer service departments manage issues and communications with a ticketing system. Paying attention to ticket volume and related metrics (like ticket closure rate) can help you understand how your customer service team is functioning.
It can give you a sense of how many customers are forced to reach out to customer service, help you estimate the staffing you need, and allow you to realize if your team isn’t closing tickets at a fast enough rate to keep up with demand.
How to measure ticket volume
Your customer service CRM should include this metric. See our list of the top customer service tools to find a CRM if you don’t already have one.
4. Customer satisfaction score (CSAT).
Customer satisfaction is vital for your business, so it only makes sense that you should measure CSAT to estimate it. CSAT is typically calculated by gathering data from customer surveys; the higher this number is, the more satisfied your customers are.
Poor scores here aren’t necessarily an indictment of your customer service strategy, but better customer service will almost always lead to an increase.
How to measure CSAT
CSAT is typically calculated by surveying customers, asking them to rate their satisfaction on a scale of 1-5 or 1-10 (ie, “not satisfied at all – extremely satisfied”). CSAT is the average value of the respondents’ scores. As such, CSAT is often expressed as a score between 1-10.
5. Customer effort score (CES).
Similarly, you should be measuring customer effort score (CES), which is calculated in a very similar way. You’ll use surveys to determine how much effort each customer needed to expend to get their issues resolved.
The more difficult it is for average customers to resolve issues, the closer you should inspect and optimize your customer service strategy.
Improve your team's email response time by 42.5% With EmailAnalytics
- 35-50% of sales go to the first-responding vendor.
- Following up within an hour increases your chances of success by 7x.
- The average professional spends 50% of their workday on email.
How to measure CES
Conduct a survey and divide the number of positive responses by the total number of responses.
CES = Total sum of positive responses / Total number of responses
6. Net promoter score (NPS).
Another important customer sentiment metric is net promoter score (NPS), which predicts the likelihood of a customer recommending your brand to other people and indirectly measures customer loyalty.
Like the two metrics before it, NPS is measured through customer surveys, and as you probably guessed, the higher your average customer NPS is, the better it is for your business.
How to measure NPS
Conduct a survey and divide the number of positive responses by the total number of responses.
NPS = The percentage of promoters – (minus) percentage of detractors
7. Customer churn rate (CCR).
Better customer service is typically associated with higher customer retention, so pay close attention to your customer churn rate.
In other words, how many customers are you losing in a given period of time? If your churn is too high, or if it demonstrates a rising trend, you may need to take action.
How to measure CCR
Churn Rate (%) = Total number of churned customers / total number of customers
How to Use Customer Service Analytics
What are the best ways to use customer service analytics?
Most organizations focus on the following goals:
1. Identify potential pain points.
Customer service analytics can help you track down, identify, and brainstorm ways to act on potential pain points. In other words, what are the flaws in your customer service strategy that are causing dissonance for customers or inefficiencies in your customer service team.
For example, you may notice that average response time to customer inquiries is relatively long, and at the same time, your customer satisfaction scores are dropping. If you can demonstrate a causal link, or even if you have a reasonable suspicion, you can act on this information and make improvements.
2. Hear and act on customer suggestions.
This is also an opportunity to hear and act on customer suggestions. Throughout various surveys, you’ll give customers an opportunity to express how they’re feeling about your business and about your customer service.
If customers repeatedly complain about the same issues with your customer service strategy, you can take action on them and fix things. Your customers may also have suggestions for how you can serve them better, which are just as valuable.
3. Optimize employee performance.
Your primary goal in customer service is making your customers happy, but you also need to think about the time and money you’re spending. In other words, you need to optimize employee performance.
Customer service analytics can help you identify potential issues related to your staff and customer service actions, potentially driving you to offer more education and training, provide employees with better resources, or introduce new incentives to motivate better performance.
4. Improve overall efficiency.
Reviewing customer service analytics is also a gateway to improving overall efficiency. Customer service is only one department in your organization, so how does it relate to your other departments?
And what steps can you take to ensure this department is achieving its primary function efficiently?
Customer Experience Analytics vs. Customer Service Analytics
It’s important to recognize that there’s some degree of overlap in the categorization of these metrics. While all of these metrics relate to customer service in some way, some of them also provide meaningful data about overall customer experience.
Customer service is often considered part of the umbrella of customer experience. Customer experience refers to how customers interact with your brand, from the time they initially hear about it, taking into account marketing and communications, sales, customer service, and core product experiences. In this context, customer service is a relatively narrow slice of the overall customer experience.
Some of these metrics are also valuable for product development, marketing, and other departments of your organization. Feel free to use them accordingly.
A best-in-class customer experience flows from a best-in-class employee experience. If you want your customers to feel engaged and welcomed, ensure that you’re treating your frontline customer service agents the same way. William Sipling, Director of Workforce Transformation at Hubstaff, says “Everything is downstream from employee experience (EX). Improve your EX, and you’ll improve CX. Keep in mind that work is a two-way street, so ensure your customer service team is motivated by awesome managers, competitive compensation, and growth opportunities. Then, they’ll be invested in your organization and will in turn invest in your customers.”
How to Track Customer Service Analytics: Best Tools for the Job
Now that you understand those metrics, it’s time to help you track them.
You can track most of these metrics with simple tools and simple surveys, but if you want things to be easier and more streamlined, it’s better to use customer service analytics tools. See my recommended tools at the links below:
I’ve got one more tool to recommend to you: EmailAnalytics.
And yes, it’s ours. But I think it’s the best tool on the market for tapping into the raw data of your employees’ daily email activity in Gmail or Outlook.
With EmailAnalytics, you’ll be able to review email-related customer service analytics such as number of emails sent and received, average email response time, and even average conversation thread length.
Sign up today and learn more about how your customer service email strategy is working!
Jayson is a long-time columnist for Forbes, Entrepreneur, BusinessInsider, Inc.com, and various other major media publications, where he has authored over 1,000 articles since 2012, covering technology, marketing, and entrepreneurship. He keynoted the 2013 MarketingProfs University, and won the “Entrepreneur Blogger of the Year” award in 2015 from the Oxford Center for Entrepreneurs. In 2010, he founded a marketing agency that appeared on the Inc. 5000 before selling it in January of 2019, and he is now the CEO of EmailAnalytics.
