Before, entrepreneurs and executives judged how well their businesses perform by the number of reservations, preorders, and purchases their brand received within a period of time. This was the case back then because a business needs sales in order to survive and grow.
But today’s marketers realized that following this strategy no longer applies to the new generation of consumers. It was not enough to keep customers happy and coming back for return transactions.
Because of this, a new measuring system was developed. It’s called Customer Success Metrics. Instead of tracking how many sales or profits a product, brand, or company made, Customer Success Metrics focuses on the customers’ experiences.
This is to help a business develop, maintain, and strengthen relationships with customers while putting the brand’s goal first for success. Which customer success metrics matter for tracking? Read on and discover.
1. Net Promoter Score (NPS)
NPS is one way to measure customer satisfaction. It’s done by asking how likely a customer would recommend your products or brand to someone else. And the good thing about it is that it gives you qualitative and quantitative data for better accuracy when analyzing feedback.
2. Churn Rate
This is a metric you should track first because it involves customers you’re losing. Churn rate examples are the percentage of customers canceling subscriptions, not renewing their contracts with you, shopping at another store, and closing their accounts.
3. Average Revenue Per Account (ARPA)
ARPA measures how much revenue your brand receives from a single account or customer. This metric helps you analyze your business’s revenue generation as well as identify which services or products yield high and low revenue.
4. Customer Retention Cost (CRC)
Making sure your customers return to your business for more transactions can sometimes be costly. It’s because you’ll be advertising, giving your customers plenty of discounts, hiring customer support personnel just to keep them happy.
CRC makes sure that you’re making smart investment strategies when it comes to dealing with your current customers. It also prevents you from funneling your resources to retention marketing tactics that yield zero or very low returns.
5. Customer Acquisition Cost (CAC)
Like CRC, CAC is about measuring your expenses when it comes to gaining new customers. This is a metric necessary to know which advertising media, time, and demographic of customers you should avoid advertising your business on and to.
6. Customer Satisfaction Score (CSAT)
CSAT is the most basic customer success metric. All you need to do is ask your customers to rate your products and services on a scale of 1 to 5 or 1 to 10. The good thing about CSAT is that it also opens more opportunities for measurement like the next success metric.
7. Qualitative Customer Feedback
This type of success metric is similar to CSAT. But instead of customers just scoring your performance, it answers the question of “why the score?” For example, you can ask customers who gave you a poor score to state why they did so. You can also do the same to those who scored you perfectly.
Yet, the most common form of tracking qualitative customer feedback is through conducting surveys. Then, you can work on the things you lack as pointed out by your customers and improve your business. If you receive plenty of positive reviews, you’ll know which attributes of your brand you should retain.
Tracking customer success metrics is essential when you want your business to succeed. It’s because customers see a lot of things you don’t. They also react honestly and that makes it easier for you to measure your performance with accuracy.
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