What is CSAT?

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CSAT (Customer Satisfaction)

CSAT, an acronym for Customer Satisfaction, serves as a vital metric for gauging the level of contentment customers experience with a product, service, or overall brand.

This glossary term definition delves into the intricacies of CSAT, providing a comprehensive overview that will empower businesses to enhance customer experiences and drive growth.

Table of Contents:

 

What is CSAT?

Customer Satisfaction (CSAT) is a metric used to evaluate how content and pleased customers are with a specific product, service, or interaction with a brand.

Typically measured through surveys, CSAT aims to quantify customer feelings and perceptions on a numerical scale.

This metric plays a crucial role in understanding customer loyalty, brand advocacy, and future purchasing behaviours.

History of CSAT

The concept of formally measuring customer satisfaction dates back to the 1970s when researchers began to explore the link between customer contentment and business success.

Informally, ensuring your customers were satisfied dates back to the first known history of humans trading for goods – trading/selling poor seeds or grains, for example, was not the way to ensure you were going to get repeat business!

Over the years, CSAT has evolved to include diverse methodologies such as Net Promoter Score (NPS) and Customer Effort Score (CES), each offering unique insights into customer perceptions.

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1970s - The Emergence of CSAT Surveys

During this pivotal decade, businesses started using surveys to gather customer feedback systematically.

The key innovation was asking customers direct questions about their satisfaction levels, often employing Likert scales to measure responses.

This marked the beginning of a more structured approach to understanding customer sentiment.

1980s - Pioneering Research and Methodologies

The 1980s witnessed the introduction of advanced methodologies to measure customer satisfaction.

Researchers began exploring statistical models that linked customer satisfaction to loyalty and repurchase behaviour.

This decade laid the foundation for metrics like Net Promoter Score (NPS), which aimed to correlate customer satisfaction with business growth.

1990s - Advancements in Data Analysis

As technology advanced, businesses gained access to more sophisticated data analysis tools.

This allowed for deeper exploration of customer feedback, enabling companies to uncover patterns and correlations between satisfaction levels and business outcomes.

2000s - Rise of Online Surveys and Real-time Feedback

The advent of the internet brought about a significant shift in how CSAT surveys were conducted.

Online surveys made it easier for businesses to gather feedback from a wider audience and in real time.

This era also witnessed the integration of CSAT measurements into websites, apps, and email interactions, making feedback collection seamless.

2010s - Holistic Customer Experience Approach

The 2010s marked a shift from isolated CSAT measurements to a more holistic approach that encompassed the entire customer journey.

Businesses recognised the need to measure satisfaction at various touchpoints and stages, leading to the creation of metrics like Customer Effort Score (CES) that aimed to gauge the ease of customer interactions.

Present and Beyond - Multichannel Feedback and Predictive Analytics

In the present era, CSAT measurement has evolved into a multifaceted practice.

Companies collect feedback through a variety of channels, including social media, chatbots, and mobile apps.

Moreover, advancements in predictive analytics allow businesses to anticipate customer needs and concerns, proactively addressing issues before they escalate.

Pros and Cons of CSAT

PROs of CSAT Measurement

1. Insight into Customer Perception

CSAT surveys provide direct insight into how customers perceive a company’s offerings, highlighting areas of excellence and areas that require improvement.

2. Actionable Feedback

The open-ended nature of CSAT surveys often allows customers to provide specific feedback, which can be used to make tangible improvements in products, services, or processes.

3. Benchmarking and Trend Analysis

Tracking CSAT over time enables businesses to identify trends, measure the impact of changes, and benchmark their performance against industry standards.

Cons of CSAT Measurement

1. Limited Context

CSAT scores, while valuable, might not offer a complete understanding of why customers feel a certain way. Add to that, “Satisfaction” is a subjective word, and “satisfied” may mean different things to different people.

To take it one step further, there is a limited correlation to a customer being ‘satisfied’ and them remaining to be a customer with your business which is why metrics such as NPS have emerged.

2. Survey Fatigue

It seems like it’s almost impossible to complete a transaction anywhere on the internet without being asked for feedback, whether it’s a $2 purchase or purchasing a new car.

Frequent surveying can lead to customer survey fatigue, potentially affecting response rates and the accuracy of results.

3. Cultural Bias

If your business operates globally or across different countries, CSAT data has shown that ratings can differ between cultures.

For example, people in individualistic countries (e.g., the United States, Germany, Ireland, South Africa and Australia) choose the more extreme ratings more frequently than those in collectivistic countries (e.g., China, Korea, Japan and Mexico).

This means that an Australian is more likely to rate service as “amazing” or “terrible” than someone from Japan, who is more likely to select “fine” or “not satisfactory’.

Measuring CSAT: Examples and Methodology

Measuring CSAT often involves distributing post-interaction surveys to customers.

These surveys usually include a single question, such as “How satisfied are you with [product/service/interaction]?”

The respondents then provide ratings, usually on a csat scale of 1 to 5 or 1 to 10, indicating their level of satisfaction, or you can use emojis to represent the scores as an alternative.

You can also use CSAT to obtain more specific information on various ‘departments’ or elements of your business.

This can provide you with insights into areas that are performing well and those that need more attention.

Overall CSAT example
Customer Satisfaction Survey example

Calculating Customer Satisfaction (CSAT): A Step-by-Step Guide

Step 1: Define Your Survey Question

To calculate CSAT, you need a specific question that asks customers to rate their satisfaction with a product, service, or interaction.

Common csat survey questions include:

  • “How satisfied are you with [product/service/interaction]?”
  • “On a scale of 1 to 5, how would you rate your experience with [product/service/interaction]?”

Step 2: Collect Responses

Distribute the CSAT survey question to your customers after they’ve interacted with your business.

This could be post-purchase, after customer support interactions, or following the use of a service.

Responses can be collected through various channels, such as email, web pop-ups, or within your mobile app.

Step 3: Calculate CSAT Score

Once you’ve collected a sufficient number of responses, it’s time to calculate the CSAT score.

The CSAT score is typically presented as a percentage and is derived from the number of positive responses (usually 4 or 5 on the rating scale) out of the total responses.

CSAT Score (%) = (Number of Positive Responses / Total Number of Responses) * 100

For example, the CSAT calculation if you received 200 responses and 150 of them were positive (rated 4 or 5), would be:

CSAT Score = (150 / 200) * 100 = 75%

Step 4: Interpret the Results

Interpreting the CSAT score is crucial to understanding customer satisfaction levels. Here’s a general guide:

  • 0-49%: Low Satisfaction
  • 50-74%: Moderate Satisfaction
  • 75-100%: High Satisfaction

Step 5: Continuous Improvement

A single CSAT score provides a snapshot of customer satisfaction at a particular time.

However, to drive continuous improvement, it’s essential to track CSAT scores over time.

By comparing scores from different periods, you can identify trends and assess the impact of changes you’ve made to your products, services, or processes.

When do you measure CSAT?

The most common approach is to use CSAT at specific points in the Customer Journey rather than an overall indicator, which can be better served by other metrics like Net Promoter Score (NPS) or Customer Effort Score (CES).

Using Customer Journey Mapping to identify key ‘moments that matter’ in your customer lifecycle can provide you with valuable intel on what areas/stages of your business need to be improved.

This could be at:

  • Support interactions
  • Sales interactions
  • Check out process
  • Onboarding

Popular methods of asking your CSAT question include:

  • Automatic after-call surveys
  • Emails
  • SMS
  • In-person (using touchscreens/iPads, push buttons etc).
Changi Toilet CSAT survey
An example of a CSAT survey being used by Changi Airport, known as their IFS (instant Feedback System) that sends immediate feedback to their cleaning crew.

5 Tips for Effective CSAT Measurement

1. Adequate Sample Size

Ensure your sample size is representative of your customer base for accurate insights.

2. Timeliness

Send surveys soon after the interaction to capture fresh feedback while the experience is still vivid.

3. Clear Rating Scale

Use a clear and easy-to-understand rating scale to minimise confusion and improve response accuracy.

4. Segmentation

Analyse CSAT scores based on different customer segments to uncover insights specific to each group.

5. Combine with Qualitative Data

Use CSAT scores in conjunction with qualitative feedback to gain a deeper understanding of the “why” behind the scores.

Conclusion & Additional Information

There is no doubt that Customer Satisfaction (CSAT) is a foundational pillar of capturing customer feedback that is one of the ‘big three’ along with NPS and Customer Effort Score (CES).

By capturing customer sentiment and feedback, companies can refine their offerings, foster loyalty, and drive growth.

While CSAT comes with its own set of limitations as we’ve outlined, its benefits far outweigh the drawbacks.

As businesses continue to navigate the ever-evolving landscape of customer expectations, embracing CSAT as a guiding metric is not just a choice, but a necessity!

ACXPA contains many resources for people looking to elevate their customer experience with all our content designed to educate, not sell.

We’ve included some links below for further information.

CX Roundtables - Upcoming Guest

Live and interactive sessions for customer experience professionals in Australia.

Upcoming CX Roundtable Steven Arnold bw

Contact Centre Manager Roundtables - Upcoming Guest

Live and interactive sessions for contact centre professionals in Australia.

Upcoming Contact Centre Roundtable - Scott Wooden

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Preview of upcoming Symposium Sessions:

Nadine Power, ACXPA National Advisory Board Member

IVR Best Practice

Over 90% of contact centres are using an IVR (Press 1 for this, press 2 for that), and we've encountered many contact centres with over four layers of options for customers to select from. In this session, Nadine will be sharing some best practice tips on IVR design for 2024.

Presented by Nadine Power, Chief Product Officer, Datagamz (and ACXPA National Advisory Board Member)

ACXPA National Advisory Board Member Simon Blair

Tips to Boost Engagement on Calls

Of the five quality competencies we assess as part of the Australian Call Centre Rankings, the 'ENGAGE' competency from the Australian Contact Centre Quality Standards has consistently been at the bottom of the rankings throughout 2023 and into 2024.

In this session, Simon will provide some tips that can be shared with agents on how to increase engagement with customers at the start of calls.

Presented by Simon Blair, General Manager Quality Insights, ACXPA

More sessions announced soon! 

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