Customer Service Metrics That Matter: How to Measure and Improve Customer Service Performance

By tracking metrics, you can make sure that your customer service strategy is performing at its best.

Customer service is an integral part of any business. Even the best product in the country can flop if customers have a negative experience, but when your business interacts with high volumes of customers on a regular basis, how is it possible to keep track?

There are several ways to determine whether your customer service strategy is working. Many businesses use services to conduct customer feedback and experience surveys or monitor social media and review app mentions. However, one of the best-regarded techniques is to track metrics and KPIs. 

What’s the Point of KPIs and Metrics?

“If you can’t measure it, you can’t improve it.”- Peter Druker, Management Consultant

Both metrics and KPIs provide data, which is an indispensable tool for strategy improvement. By tracking KPIs, companies can glean valuable insight into their operations’ success, discover important pain points, and make necessary improvements to their operations. 

KPIs and metrics are related, but they are not the same thing. Metrics are a system of measurement (in this case, customer service success.) KPIs, or key point indicators, are a type of metric. These tools are vital for customer service success as well as other facets of business, like marketing, sales, and HR performance. 

What are the Most Important Metrics in Customer Service?

“Strategies are abstract and metrics make them concrete.” – Ram Srinivasan, Leadership Coach

Every company and department has a different story. These are reflected in their unique set of KPIs. Depending on your strategy, you can determine and track targets unique to your operational needs. Many of these KPIs will be specific to the industry or department of measurement. So, in the case of customer service, KPIs would likely track contact center performance. There are also more general types of KPIs for companies to measure, like overall customer retention rate.

Great customer service can look different from industry to industry, but some aspects are true no matter what. For instance, nobody likes to wait on hold! Those universal customer service truths lend themselves to here are quite a few helpful call center-specific metrics. These include:

  • Call handle time 

Customers don’t contact customer service for a leisurely chat. They’re in touch because they have a problem or question to address. This KPI keeps this pain point in check by measuring the overall time agents spend on the phone with customers.

  • Average length

As the name suggests, this measures an average call center conversation length. This can then be analyzed according to the needs and nature of the specific industry it’s working within. For instance, a medical call center might have a longer call center average than a ticket booking service. 

  • Call center agent sales rate

Many companies integrate a sales strategy into their call center operations. In those cases, it’s typical to measure agent sales rates.

  • Customer effort score/CES 

A great indicator of customer service success is the ease with which client needs are being met. This can be measured through customer feedback sessions and surveys.

  • Net promoter score/NPS 

Most businesses want to know if their customer service was positive enough to elicit customer loyalty and good word-of-mouth marketing. NPS measures this type of customer loyalty through experience surveys and feedback sessions. 

  • Calls blocked/busy 

Unreachable support centers are a common culprit of “bad” customer service. By tracking the rate at which customers experience dropped calls or busy signals, companies can take the necessary measures to ensure better coverage, more straightforward interactions, and fewer disgruntled customers. 

  • First call resolution rate

Call escalations, transfers, and callback sessions can’t be avoided altogether. But for non-complex cases, a first-call resolution is ideal. This KPI tracks how often a case is resolved within one interaction.

Metrics, Technology and the Future

“We let the algorithm find the patterns.”-Avinash Kaushik, Analytics Expert

It feels like the future is here, but of course, that’s not the case. Technology will continue to advance. As it evolves, so does business—including customer service, consumer expectations, metrics, and KPIs. This is crucial to keep this in mind when developing a metrics-measurement strategy. Otherwise, it’s easy to fall behind other, more tech-savvy businesses.

Customer service is a human-led industry. This is why so many people get angry with automated call services and “web chat” features that are actually bots—they don’t understand nuance. Great customer service relies on empathy that only a human can have. However, technology has begun to play an important role in facilitating this type of customer support, including the measurement and tracking of metrics. 

These days, many businesses integrate technology into their strategies to support their call center agents. For example, some companies have utilized “decision tree” algorithms to find gaps in their strategy and determine appropriate KPIs to track. Customer service teams can then use these new, algorithm-based KPIs to develop an up-to-date strategy that meets current demand. This technique utilizes cutting-edge technology in a way that centers customer-agent interactions over an automated fix.

Looking at the “Big Picture”

“When a measure becomes a target, it ceases to be a good measure”- Goodhart’s Law

Metrics are a fantastic way to track performance and operational success. However, it’s important not to look at them with tunnel vision. When businesses focus too much on tracking metrics, they can lose sight of their company’s actual performance (revenue, anyone?). Talk about missing the forest for the trees! When dealing with metrics, keep in mind that KPIs are indicators of specific performance, not actual results. Fixating on these numbers without the context of actual results can end up harming a business more than boosting its sales.

Need an example? Imagine an online retailer that has a zero-returns policy. Every time a customer calls their contact center to request a return, they are told it’s impossible. All of these inquiries are resolved within one phone call. This means that, when tracking their KPIs, a company would see that their first-call resolution rates are very high—usually considered a good thing. However, these customers are likely pretty unhappy about their customer service experience. This is because the measure became a target, and the end result was not considered. 

The above scenario is easy to avoid, but it takes more work than just monitoring a checklist of KPIs. It requires consideration, strategic thinking, and teamwork. This is why so many businesses choose to outsource their customer service department altogether. Business process outsourcing (or BPO) call center and customer support services typically provide helpful tools for performance measurement that go beyond tickbox metrics. Perhaps most important of all, companies must continue to listen and learn from customer feedback in every form. While it can sometimes be challenging to accept negative feedback, it’s worth the effort in the long run.


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