Customer satisfaction score (CSAT): Definitive guide

Customers are bombarded every day with information and opportunities, making competition fiercer, marketing more complex, and customer service even more important.  Measuring your customers’ satisfaction may be something that you have kept on the back burner, but it’s an important part of business success.

There are many ways to measure customer satisfaction. NPS and CES can help, but their metrics can be complicated and harder to understand. Perhaps the easiest and least complicated way to measure customer satisfaction is through CSAT.

Customer satisfaction scores (CSAT) are the primary way that businesses measure customer satisfaction. The measurement is done with a numerical score and is used to gauge the customer's experience with the company, their purchase, or any interactions that they have had when dealing with the business.  

Customers generally don't mind completing customer satisfaction surveys because they are usually quick and easy. They typically feature short questions with a choice of numerical answers.  

For example, a survey may ask: "How satisfied were you with the response you got from our customer service representative?" or "How would you rate your experience shopping with us today?" The customer would rate their satisfaction by choosing a numeric value that ranges from extremely dissatisfied to extremely satisfied. The numerical choices may range from one to five or one to ten, etc.  

Net Promoter Score (NPS) measures customer loyalty to a brand or company. They, too, usually feature simple questions based on how likely you would be to recommend a business to others. Respondents usually fall into one of three categories:

• Promoters: with a high likelihood of making a recommendation

• Passives: customers who are satisfied with the company but are not committed to remaining loyal 

• Detractors: those who are dissatisfied and would not recommend the company to anyone

Customer Effort Score (CES) measures the customer's perceived ease of use of a product or service. You may see questions like:  “How easy was it to use product XYZ?” You would then be offered numerical scores to rate from easy to difficult.

Though all three metrics are important, they differ in measuring certain satisfaction levels. CSAT measures short-term customer satisfaction with a product or a service. NPS focuses on brand loyalty, and CES measures the ease of use of a particular product or service.

To measure CSAT, a question is created that can be answered using a range of numerical responses. These questions are based on metrics, not open-ended, and do not require a lengthy answer.  

They are short, to the point, and easy and quick for the customer to complete. CSATs often list a scale of responses from very satisfied to very unsatisfied, with each level of satisfaction assigned a numerical score.  

For example: How satisfied were you with XYZ's response to your problem?

1. Very unsatisfied

2. Unsatisfied

3. Neutral

4. Satisfied

5. Very satisfied

The customer chooses the number that best describes their level of satisfaction. CSATs are often found at the checkout after a purchase is made, as an add-on to a customer service call, or a pop-up on a website. 

The best way to get an accurate measurement of customer satisfaction is to survey as soon as possible after the experience, so that the customer has their feelings about the experience fresh in their mind.

One of the reasons that CSAT is so popular is the ease of calculating the satisfaction score. For example, using the 1-5 scale mentioned above, you would count all of your positive responses (those rating 4 or 5). 

The sum of the positive responses is then divided by the total number of responses that were collected. Multiply that number by 100 and you will have the percentage of customers who are satisfied with your product or business.

There are three situations in which CSAT typically should be measured. As stated before, collecting this information as soon as the process is complete will most likely give you the best, most accurate information.

1. After key customer lifecycle moments

The customer lifecycle describes the end of the customer interaction, such as ordering, onboarding, completing return information, etc. This information should be collected as soon as possible after customers have completed the actions so they can give honest, up-to-date responses.

2. Prior to renewal

If your product involves memberships or subscriptions, don't wait until it is time for the customer to renew. By gathering customer service data prior to renewal, you give yourself enough time to correct negative situations or rectify issues. 

3.  After customer support or education interactions

By surveying customers shortly after they deal with customer support, you can accomplish two things. You can be sure that your representatives are providing proper service and that your customer is happy with the service provided.

If your business is providing education, you will be able to gauge how easily the customer was able to connect with the material by surveying their satisfaction level.

Of course, the perfect CSAT score would be 100%, meaning that every one of your customers was either satisfied or very satisfied. Unfortunately, this may be unrealistic. You will have to decide for your business what an acceptable score will be.  

Most businesses accept a score between 75 and 85%. This tells you that three out of four customers are satisfied, with a 75% CSAT score. Industry standards are different, but most still fall within this range. 

The American Customer Satisfaction Index offers these examples:

• Automobiles: 78%

• Breweries: 81%

• Cell Phones: 79%

• Computer Software: 76%

• Financial Advisors: 77%

• Hotels: 73%

• Internet retail: 78%

Any time you collect data with any type of metrics, especially when it comes to measuring something as subjective as satisfaction, there will be both pros and cons. It is just one part of the system designed to measure a business's success.

Pros of CSAT

• CSAT is easy to measure, simple to use, and can be administered across several channels

• Customers are not spending excessive amounts of effort or valuable time answering lengthy surveys so you get a higher response rate

• You can tailor easy questions with the ratings that work best for your customers, and can incorporate everything from numbers to emojis to rate their satisfaction  

• It is widely used, making it easy to compare your ratings with those in similar businesses

 Cons of CSAT

• CSAT scores are simple and do not offer a huge amount of detail or a deep dive into the reasons behind the scores

• Single-question surveys and responses can be unreliable 

• Many times the score measures the last touchpoint of a customer's experience only, not providing a quality measure of the entirety of their interactions with the company or brand

•  Because different industries have different standards, there could be confusion about what "bad" or "good" scores are.

In order to get a better understanding of CSAT scores, we can look at a simple example, such as dog food. To rate the customer's satisfaction with your product, you might ask:

How satisfied were you with Yummy Dog Chow?

1. Very dissatisfied

2. Dissatisfied

3. No opinion

4. Satisfied

5. Very dissatisfied

Customers responding either with a four or a five would be calculated as satisfied. (See the calculation above.) You could use other related questions with similar scales to determine customer satisfaction with their most recent visit to your site or storefront, using a website, or reading a newsletter. You could assess their satisfaction level resolving an issue or their overall satisfaction with any product that they have purchased.  

CSAT scores may be the key to improving customer perception of your brand. When you gather data at key touchpoints, it gives you a good idea as to how well you are meeting your customer's expectations. Finding negatives or pain points along the customer experience can help you gain insight into what they want and make strides to improve in those areas.  

Using the CSAT data can also help you with customer loyalty and retention. Sometimes we can get lost in thinking that everyone enjoys the same experiences. But if your customer, that person who wants and needs your product, does not share the same enjoyment, CSAT scores may help you make that shift.

CSAT scores can be a marketing tool as well. If you consistently rate higher than industry standards, you can use it to your advantage: "Our customer satisfaction level rates are 5% higher than other dog food brands!"

The Harvard Business Review found in a recent study that improving customer satisfaction will help a business retain 74% of its current customers for another year. Customer retention is key to increasing your bottom line. They also found that these satisfied customers spent more (up to 140% more) than those customers who reported having a poor experience.

CSAT measures customer satisfaction. The questions are usually short with numerical ratings as choices for the response. An example would be: How pleased were you with your purchase?

Once you collect your data, you can determine at which touchpoint the customer rates the lowest amount of satisfaction, and start by making improvements in that area.

Low scores indicate that they were dissatisfied with the product, service, or experience that you are asking about.