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The Four Most Important Customer Satisfaction Metrics

Exceed customers growing expectations by evaluating and adjusting to these four core customer satisfaction metrics.

Good Isn’t Good Enough

Customers today have increased expectations for companies. Businesses that fail to satisfy customers risk losing them, possibly for good. Consider these stats:

  • Only 23% of customers today are “very satisfied” with their experience
  • 44% of customers are open to trying new brands, even if they generally like the ones they currently use
  • 86% of consumers will leave a brand after only two or three bad experiences
  • Once you lose a customer, you have only a 20 to 40% chance of winning them back again 

How can you overcome these numbers?

You must measure and consistently monitor customer satisfaction.

What is Customer Satisfaction?  

Customer satisfaction evaluates how happy your customers are with your products, services, and overall experience. It is a key component of Customer Experience and a critical performance indicator that companies can use to gauge customer loyalty, product quality, and customer service.

What are the Four Key Metrics of Customer Satisfaction?

Customer satisfaction is a composite of many different aspects of your customers’ interactions, thoughts, and perceptions. A comprehensive customer satisfaction analysis that evaluates all of these elements, is the key to truly understanding and improving customer satisfaction. 

Any measurement of customer satisfaction should cover these four key elements:   

  1. General Satisfaction 
  2. Customer Perception  
  3. Customer Loyalty  
  4. Likelihood to Recommend

Why Should You Evaluate Customer Satisfaction Metrics?

Measuring customer satisfaction will give you the insights you need to improve it and to make sure any ongoing initiatives to improve satisfaction are working. A successful customer satisfaction analysis uncovers hidden risks, corrects assumptions, and reveals untapped opportunities. Improving customer satisfaction leads to more than happy customers. Optimizing your offerings, service, and brand to match customer expectations has many additional benefits.  

Benefits of Measuring Customer Satisfaction:  

  • Gain Insights to improve your products and services to strengthen your competitive advantage and share of the market 
  • Identify the value and ROI customers attribute to your offerings to support your sales and marketing efforts 
  • Build loyalty for increased retention and brand advocates that promote your offerings 

How to Measure the Four Key Customer Satisfaction Metrics 

One of the most common methods of measuring customer satisfaction is through surveys. Customer satisfaction surveys can gauge the thoughts, feelings, and opinions of customers on your company overall or with specific aspects of your product or service.    

Survey research gathers customers’ opinions, preferences, and experiences by asking a set of questions to a target audience. Surveys collect feedback from a representative sample of a targeted audience allowing these results to be generalized to the larger population with a strong confidence level of their accuracy.  

The results of the survey identify which factors are the most influential in raising or lowering customer satisfaction and can be run periodically to compare results over time, allowing companies to measure the impact of their strategies and monitor any signals of negative satisfaction.  

To measure customer satisfaction, you will need to build targeted survey questions that delve into the four core customer satisfaction metrics. If you are looking for examples of questions to get started, check out our infographic — How to Measure Customer Satisfaction.   

Measuring the Four Key Customer Satisfaction Metrics  

1.  General Satisfaction

What It Is:
General satisfaction evaluates customers’ assessment of a company and its offerings and uncovers customers’ overall opinion of their experience with a company and its products or services.

What It Reveals: 

Some insights from evaluating general satisfaction include: 

  • Understanding customers’ evaluation and satisfaction with your brand
  • Identifying the key elements customers value
  • Uncovering which elements fall short of customers’ expectations 

How to Measure:

General satisfaction is measured through your Customer Satisfaction Score (CSAT), which is the result of a single question: How would you rate the overall satisfaction of the offering? 

You can also include additional questions that delve into customers’ opinions on specific elements of your offering. For example, “How would you rate our customer service?”

How To Take Action: 

By evaluating customers’ satisfaction with your overall offering and individual elements, you can identify what elements are falling short of expectations and develop plans to enhance your offerings.  

Having uncovered the main factors of decreased satisfaction, you can also conduct additional research through additional surveys, interviews, or focus groups. This will allow you to gain additional feedback to design effective optimization strategies.

2. Customer Perception

What It Is:
Customer perception refers to customers’ views of your brand and the key elements influencing customers’ opinions.

What It Reveals:  

Some insights from understanding customer perception include: 

  • Customers’ positive and negative opinions of your brand 
  • The key values customers attribute to your brand  
  • Your brand evaluation against others in the market 

How to Measure:  

Design questions that uncover customers’ perceptions of your company and provide the insights you require. For example, to answer the first question above, your question can look like this: 

  1. How much do you agree or disagree with the following statements about our company? 
    • Valuable  
    • Trustworthy 
    • Unique  
    • Contributes to your success  
    • Meets your needs 

How To Take Action: 

Customers’ perception of your brand significantly affects their choice to remain a customer. It is essential to protect your brand’s positive reputation by promptly addressing any negative views that could drive away customers. 

Evaluating customer perception also presents an opportunity for brands to identify their brand value and positive evaluations and leverage those findings in their marketing and sales efforts.  

3.  Customer Loyalty

What It Is:
Customer loyalty evaluates the likelihood that customers will buy your products again. This can be measured through future purchase intent, which reveals what motivates customers to purchase and which aspects turn them away.

What It Reveals:  

Some insights from measuring customer loyalty include: 

  • An Indication of customer retention  
  • The elements that are contributing to customer retention  
  • The aspects that fail to meet customer expectations and determine how to fix them  

How to Measure:  

Ask questions that delve into their decision or hesitation to remain a client. For example, to answer the last question above, your question can look like this:  

  1. Why are you unlikely to continue purchasing our offerings in the next 12 months? 
    • The price is too high  
    • Dissatisfaction with the product  
    • Negative experience with customer service  
    • I no longer have a need for the offering 

How To Take Action: 

The results of this survey will highlight the main reasons for retaining or losing customers. Often, these results will require additional research and planning. For instance, if price was revealed to be a significant factor in customers’ decision to leave, you may want to reexamine your pricing model and determine if lowered prices or a tiered pricing model may allow you to serve a larger market while still protecting your revenue.  

4.  Likelihood to Recommend  

 What It Is:
Likelihood to recommend evaluates a customer’s engagement with your company and willingness to promote your brand to their peers.

What It Reveals:  

Some insights from assessing likelihood to recommend include: 

  • The number of customers willing to recommend your brand 
  • What drives customers to recommend your brand 
  • What elements are they [willing/not willing] to advocate for  

How to Measure:
The most common way to measure likelihood to recommend is by assessing your Net Promoter Score® (or NPS). Your NPS measures customers’ willingness to recommend your brand and products to others. It consists of a single question: How likely are you to recommend our company to your friends or colleagues

In addition, you can ask follow-up questions to gather additional context. For example: “Why are you [likely/unlikely] to recommend our company?”

How to Take Action: 

Leverage these insights to identify what elements, while not turning customers away, are not meeting their standards.  

You can also incorporate positive insights into your marketing and sales materials to highlight how customers value you and potentially gather some customer quotes to highlight in your advertising.   

Ready to increase your customer satisfaction?

Learn more about how Hanover can help.
Customer satisfaction metrics

Author Information

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Education: B.A., Mathematics / B.A., Economics, Washington and Jefferson College; M.A., Economics, George Mason University
Areas of Expertise: Corporate market research, Survey research

Kristina Prudence is an experienced market researcher, specializing in advanced survey research methodologies. She loves to provide support to clients by taking complex methods and presenting them in a way that makes them more accessible and easy to understand. She has a proven track record of uncovering meaningful, actionable insights for brands spanning industry, audience, and research objective.

“Interpreting quantitative data can be difficult and overwhelming for many. I strive to simplify the research process for clients by asking them to define their key business needs and take it from there. Once I know the question my client is trying to answer, I can develop a plan that will most effectively answer their question and provide the data they need to make business decisions.”
Customer satisfaction metrics

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