How to Measure Customer Engagement: Key Metrics & KPIs

How to Measure Customer Engagement: Key Metrics & KPIs.

You hear about customer engagement everywhere you turn. It's a priority for many sales and marketing strategies and essential for every stage of the customer lifecycle. But what does customer engagement entail, and why is it so important? How do you measure the success of your efforts?

What is customer engagement, and why is it important?

Customer engagement strategies build customer relationships and improve customer satisfaction through content, emails, text messaging, loyalty programs, social media interactions, webchat, one-on-one conversations, events, etc. Instead of one-off transactions, customer engagement focuses on repeat interactions throughout the customer lifecycle to turn prospects into customers and customers into advocates.

Effective customer engagement helps you improve customer retention and drive revenue through repeat purchases. These loyal customers are also more likely to tell others about your products or services, lowering customer acquisition costs and building brand awareness. Meanwhile, the two-way dialogues give you insights into consumer preferences to anticipate market trends and customer demands.

How to measure customer engagement

Customer engagement software helps you improve communications and interact with customers via multiple channels to meet them where they are. Moreover, you can collect and analyze data to generate valuable insights to inform your strategy and tactics. So, what key performance indicators (KPIs) should you measure? Let's review the top customer engagement metrics you should track and how to improve them.

7 top customer engagement metrics

These customer metrics can help you keep a pulse on customer sentiment, track the effectiveness of your customer onboarding and retention strategies, identify areas of improvement, and optimize every touchpoint throughout the customer journey to drive conversion.

1. Customer satisfaction score (CSAT)

This metric measures how happy your customers are about your brand to understand the effectiveness of your customer engagement and customer experience strategies. It also helps you identify individuals who aren't satisfied with their interactions so you can promptly address issues and protect revenue.

Besides traditional surveys, you can measure CSAT via advanced monitoring methods. For example, sentiment analysis enabled by AI-powered natural language processing technology allows companies to track positive or negative opinions about their brands. You may use these tools to analyze social media conversations and customer reviews to help improve the customer experience.

2. Net promoter score (NPS)

To obtain an NPS score, ask your customers how likely they are to recommend your products or services to others on a scale from zero to ten. Then, classify these respondents as promoters, detractors, or neutral customers to gauge their loyalty and how likely they would advocate for your brand.

You may use NPS to measure specific touchpoints along the customer journey (e.g., shipping experience, contact center interactions, e-commerce user flow) to identify areas for improvement. You may also include an open-ended question in your survey to gather customer feedback and implement a process to follow up with these customers and address the issues.

3. Customer effort score (CES)

A frictionless customer experience makes it easier for people to buy from you, get support, and become repeat customers. Like NPS, you may measure the CES of specific customer touchpoints to help you focus resources on improving what could be hurting your engagement and conversion rates.

For example, you may improve your CES by providing omnichannel support (e.g., via voice calls, SMS, web chat, social media messaging, etc.) to answer questions and resolve issues promptly. You may also use advanced call routing technologies in your contact center to direct customers to the most appropriate agent or employee to address their concerns.

4. First contact resolution (FCR)

Calling a company multiple times for the same reason is frustrating and tiresome. FCR helps you understand if customers receive the help they need at the first point of contact. You may measure FCR for individual call reasons to identify broken processes that increase CES, impacting customer engagement and loyalty.

Improve your FCR by providing your team with easy access to customer data to personalize the conversation and address issues. For example, an agent dashboard that displays customer information, preferences, and purchase histories alongside a knowledge base, product data, and company policies helps facilitate customer interactions and issue resolution.

5. Customer lifetime value (CLV)

Engaged customers are likelier to purchase repeatedly and spend more with your brand. Forecasting a customer's total value to your company helps you focus on the long game, fostering customer loyalty to support sustainable growth and long-term revenue instead of only acquiring short-term gains.

You may also measure the CLV of individuals to prioritize and engage with your highest-value customers. For example, you may use the insights to implement advanced call queuing and routing technologies to place your best customers on a shorter call queue to receive faster, more personalized services — rewarding their loyalty to improve retention rates.

6. Average handle time (AHT)

This key performance indicator (KPI) measures the average time it takes for a contact center to complete a customer transaction or resolve an issue. It includes the talk, hold, conference, and wrap time. A shorter AHT often reflects a more streamlined customer experience and higher customer satisfaction.

To improve AHT and facilitate customer interactions, you may provide training and implement a knowledge base to make product information easily accessible to agents. You may also record calls to support coaching and optimize call routing to direct customers to the most appropriate agents.

7. Social media engagement

A loyal customer is likelier to engage with your brand on social media, so measuring likes, shares, poll participation, and group activities can help you understand customer engagement and sentiment. While a "like" is always a good sign, comments and shares demonstrate higher intent and are more valuable.

You may ask questions and spark conversations to encourage two-way dialogues with your followers. Use hashtags to reach a wider audience and host contests or giveaways to attract participation. Also, monitor comments and mentions to identify potential issues before they impact customer satisfaction.

Additionally, incorporate social media as a support channel with customer engagement software like GoTo Connect Customer Engagement. For example, you may provide support and answer questions via direct messaging or follow up with users who leave an unfavorable comment. 

Improve customer engagement metrics with streamlined communications

A streamlined communication experience encourages customers to continue engaging with your brand, build trust and confidence, and make repeat purchases. However, keeping tabs on multiple customer touchpoints can be challenging for SMBs with small teams.

Customer engagement software helps you consolidate customer communication channels to streamline processes while improving the customer experience to boost customer engagement metrics. You can manage various touchpoints, including voice, webchat, SMS, social, and video, all in one place to ensure nothing falls through the cracks.

Additionally, all your team members can collaborate seamlessly with shared customer details and contact history to keep customers engaged. A robust platform like GoTo Connect Customer Engage also allows you to send personalized SMS messages at scale with its AI-powered messaging assistant to engage customers in interactive conversations and gather customer feedback with surveys.

Learn more about GoTo Connect Customer Engagement and see how features like conversation tagging, SMS campaign scheduling, real-time messaging, targeted outreach, and more can help you improve customer engagement, loyalty, and retention.

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