Join Jeff Toister for an in-depth discussion in this video Using data to evaluate service, part of Customer Service Foundations.
In this video, I'm going to cover a number of ways that companies collect data to evaluate customers' perceptions about the service they receive. See if you can spot metrics that your company currently uses. You may find it helpful to download the worksheets so you can track each metric we cover. Customer service metrics can be grouped into three categories: Performance metrics measure what we're doing to provide outstanding service. Perception metrics measure how our customers perceive our service. Outcome metrics measure the results of outstanding service.
Let's start by looking at some examples of performance metrics. There are two basic types of performance metrics. Productivity and quality. Productivity metrics measure how fast we serve our customers. Customers expect increasingly fast service. And companies are also interested in serving customers as efficiently as possible. Some common productivity metrics include: Response time, which is how quickly we can respond to a customer inquiry such as an email. Handle time, which is how long it takes to complete a phone call with a customer.
Wait time, which is how long a customer has to wait to be served. Customers don't just want fast service, they want accurate service too. Here's some examples of quality metrics. Return rate, which is a measure of how often a product is returned. Monitoring score, which is a measure of how closely an employee follows an established set of service standards. Error rate, which measures how many errors are made in various stages in the service delivery process. First Contact Resolution is a metric that evaluates both speed and quality.
It measures whether a customer's problem was resolved on the first try. Fixing a problem the first time makes customers happier and saves the company money. The second category of customer service measures are perception metrics. This type of data is often called voice of the customer or VOC for short because it's used to evaluate how customers feel about the service they've received. The most common type of VOC data is the customer satisfaction survey. You see these surveys everywhere, such as websites, comment cards, and even on store receipts.
These surveys contain a variety of questions to assess customer perceptions about different aspects of the service they receive. Another type of VOC data is called a Net Promoter score. This survey measures how likely customers are to recommend a company's product or service to someone else. There are some obstacles to collecting voice of the customer data. One is customers get so many survey requests these days that they're tired of filling them out. And may not want to respond to your company's request. Another challenge is customers are reluctant to fill out a survey if they don't think a company will actually do something with it.
A really good customer service survey program addresses both of these challenges. It uses surveys that are simple and easy to complete. And the data is used to help companies continuously improve customer service. The third category of customer service measurements are outcome metrics. These metrics help evaluate the impact that customer service has on the business. The most basic one is sales. Customers spend more when they receive great service. But some companies dig a little bit deeper. One example is a metric called average lifetime value.
This is the amount of money a typical customer is expected to spend with your business over their lifetime. Understanding this number can help employees maintain the proper perspective when handling a problem. Imagine a retail department store where the average customer spends $50 per visit. What is their business really worth? If they visit the store twice per month they might spend an average of $1200 per year. If the average customer will shop at that store for ten years then the average lifetime value of that store's customers is $12,000.
A business might work a lot harder to please a customer worth $12,000 than a customer worth just $50. Companies also look at metrics that help evaluate how well they attract and retain customer. Here are the two most common examples. Referrals, these are new customers who are referred by existing customers. Retention, these are existing customers who do business with your company again. To recap, we've gone over three types of customer service metrics. Performance, perception and outcomes.
If you downloaded the worksheet, see if you can spot which metrics your company is using and why. Keep in mind that the examples I shared with you are just the tip of the iceberg. There are many ways that companies can measure customer service.
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- What is outstanding customer service?
- Identifying your customer
- Creating a customer service vision
- Enhancing likability in person, over the phone, and via email
- Actively listening to customers
- Going the extra mile
- Taking ownership of problems
- Diffusing angry customers
- Using data to evaluate and improve your customer service<br><br>
- The PMI Registered Education Provider logo is a registered mark of the Project Management Institute, Inc.