CSAT is a widely used indicator to measure your customers' satisfaction. Although it seems very simple, there is much more behind the score and many insights can be extracted from CSAT without having to have studied statistics.

After reading this article, you will know exactly how to really use it (in a still simple way) and thereby improve your company's results.

What is CSAT?

CSAT stands for Customer Satisfaction Score and is a very simple way to measure your customers' satisfaction using a 5-star system. For example, after a conversation with your customer service, customers can be asked (automatically) to leave a score from 1 to 5 stars:

• 1 Star: inadequate
• 2 Stars: mediocre
• 3 Stars: neutral
• 4 Stars: good
• 5 Stars: excellent

The beauty of this is that it is very simple and intuitive for customers. It's also easy for you to interpret and indicates at a glance how a customer feels about contacting you, your products or services.

How to calculate CSAT & what does this score mean?

If you have collected several reviews, then the average of these reviews is displayed as a percentage. For example, 80%.

In this example, the score tells you that 80% of the customers who gave a review rated you with at least 4 or 5 stars. So 20% of the customers have given a lower rating.

Chances are that if you already process CSAT scores, you use a tool that collects customer feedback. Think customer service management tools or customer satisfaction surveys, for example.

Collecting CSAT manually is also possible, of course, but is a lot of work and there is a risk that you or your team will not consistently ask for the score. If you work with a customer service partner, you can assume they will take care of this for you as part of the service.

How do you calculate CSAT if you want to calculate it manually? With the following formula:

Het aantal 4 en 5 sterren beoordelingen / het totaal aantal beoordelingen *100%

For example, if you received 8 reviews of 4 or 5 stars out of a total of 10 reviews, according to the above formula, you have a CSAT of 80%.

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What is a good CSAT score?

The short answer is above 77-80%. The long answer is, it depends, because depending on the industry you're in, scores vary widely. The American ACSI does annual research on this and keeps benchmarks for each industry.

Is your score below the benchmark? Then read on to see what you can do about it!

Ways to improve your CSAT score

If you have an average CSAT score that is below the benchmark of 77-80%, this is not immediately a disaster. In fact, the beauty of CSAT is that you can quickly see where it is due.

In fact, it is customary after completing the CSAT to ask for a brief explanation from which you can see what the customer's arguments are. If it is linked to a customer service conversation then you can immediately deduce from that conversation where any dissatisfaction originated.

This is incredibly valuable information because it is often very clear what customers are dissatisfied about, and if you adjust this, you can make current but especially future customers satisfied.

Evaluate business strategies:

In e-commerce, we often see things like return policies or poor customer service accessibility as causes of dissatisfaction. It's not always possible to completely turn this around, but a small tweak can make a big improvement in your CSAT.

Evaluate products and services:

If you see a lot of dissatisfaction with a particular product due to common defects, evaluate the production process or switch suppliers. When it comes to a service, see how you can adjust your service based on the feedback to fit within customer expectations, or manage expectations with the customer more clearly.

Request a review:

It is also important to ask your customers for the review. After all, customers are more likely to give a review when they have a very positive or negative experience, but anything in between is also valuable. Do you collect CSAT scores through your customer service department? Then send the request right at the end of a conversation so the customer can fill it out right away. If you wait longer to do this then the attention has already faded and the chances of receiving a review are slim.

Evaluate your team's performance:

A low CSAT score can be caused by your products or services, but also by the team in contact with the customers. So a low score does not necessarily mean that your team is doing a bad job. Conversely, it does not necessarily mean that your products or services are bad either.

To rule this out, it is important to look at CSAT scores by customer service representative or if you have a B2B model, by team or account manager. Why do you want to do this? Because if the low CSAT score is not because of your products and services, it may be because of the way customers are being served. If a particular employee consistently has a score lower than the team average, then it's important to give that employee more guidance and training so that he or she meets customer expectations.

Measuring the performance of your customer service team is super important, read more about how to easily evaluate your own customer service team's performance here.

Talk to your customers:

Of course, it's always nice to receive a good review, but it's just as important to hear from a dissatisfied customer what could be done better. Contact these customers and ask about their experience. Express that you think it is important that they are heard and that you want to improve based on their feedback. Customers appreciate this and even more, if they see that something is actually done with it, it can turn a dissatisfied customer into a loyal ambassador. And as we wrote earlier, loyal customers have lots of benefits, such as a lower return rate and come back more often for repeat purchases.

Pros and cons

To complete the picture about CSAT, we'll list the pros and cons of CSAT for you.

Pros:

• It's low-threshold: clients can complete it with 1 click.
• Easy to interpret: you can immediately see how satisfied customers are.
• Provides insight into areas for improvement: you can easily find out where you can improve your service.

Cons:

• Limited insight (at first glance): you will have to dive into the details to see where good or bad ratings come from.
• Bias: individual result may also depend on one's state of mind and not necessarily reflect the truth.

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Need help?

Can't figure out the leak, or find it difficult to implement CSAT for your webshop? Then consider outsourcing the customer service of your ecommerce business to specialized partner such as Hikari CS who achieves an average CSAT of 85% for its clients.