Here is a golden rule: anything above 70% is a GOOD CSAT.
Bad customer service experience brings to over $3.1 billion loss annually. Customer satisfaction is more than a feel-good metric—it directly influences business success, customer loyalty, retention rates, and operational efficiency, and all these in their turn effect the ROI. In a highly competitive market where every customer means revenue, businesses can’t ignore consumer expectations. Organizations need concrete data to assess how well they meet customer needs. This is where the Customer Satisfaction Score (CSAT) comes into play.
CSAT measures customer sentiment, offering companies an immediate picture of how satisfied customers are with a specific interaction, service, or product. While organizations pour resources into customer service, product enhancements, and user experience design, without an accurate method of measuring satisfaction, they operate in the dark. CSAT is one of the metrics (yes, it may be one of the most important, but there are many other contact center metrics not to ignore) that brings clarity, allowing businesses to understand their customers’ perspectives and make informed decisions based on real data.
What is CSAT (customer satisfaction score)?
CSAT is one of the most critical contact center performance metrics that measures customer satisfaction based on direct feedback. It is typically derived from a single survey question:
“How satisfied were you with your experience?” All of us have not once been asked this question and offered options to rate the service using a scale, most commonly ranging from 1 to 5, where:
1 = Very Unsatisfied
2 = Unsatisfied
3 = Neutral
4 = Satisfied
5 = Very Satisfied
64% of customers claim their decision to switch to a competitor was influenced by a poor customer experience.
Some contact centers use a 1-7 or 1-10 scale to get more detailed feedback, but the principle remains the same: higher scores indicate greater satisfaction. CSAT is a short- and long-term metric, depending on the business objective. For example, the business has launched a new service or product and wants to evaluate the initial feedback for future iterations and improvements.
Why is CSAT Important?
Companies often assume that if customers aren’t complaining, they must be satisfied. However, 73% of customers prioritize service quality over price, and dissatisfied customers are much more likely to leave, even if the offered price is lower than that of competitors. In short, CSAT is a structured strategy defining low performance before it translates into customer churn.
Here’s why CSAT should not be ignored:
Operational Insight: It helps businesses identify bottlenecks in their customer journey, understand product/service performance, and determine whether it covers customer needs, allowing for targeted improvements.
Customer Retention: Satisfied customers are likely to return and engage in repeat business.
Competitive Benchmarking: CSAT helps organizations compare their customer satisfaction index against industry standards.
Product and Service Validation: It provides direct feedback on new products, features, or services, guiding future development.
Revenue Growth: Finally, a high CSAT score is correlated with increased customer lifetime value (CLV) and reduced customer acquisition costs (CAC).
Boost brand reputation: 72% of satisfied customers will tell 6 more people about the brand contributing to all-time, best-performing word-of-mouth marketing.
Allocate resources to problem-solving: CSAT shows the bottlenecks, thus helping businesses allocate necessary resources to the exact issue rather than doing guesswork.
How to Measure CSAT?
To measure CSAT, businesses send surveys for key customer touchpoints, such as online chats (including social media messaging), calls, tickets, and email surveys. CSAT measurement effectiveness depends on precise timing and context. The most common methods include:
After-call survey: The most common CSAT survey is sent immediately after the call, asking customers to press buttons from 1 to 5 based on their experience.
Post-Purchase Surveys: Sent immediately after a transaction to rate experience and satisfaction with the business.
Customer Support Interaction Surveys: Sent after customer service engagements to assess agent performance and problem resolution.
Periodic Sentiment Checks: Ongoing surveys sent to long-term customers to track overall experience trends.
Onboarding Experience Feedback: Given to new users after their initial interactions with a product or service.
When to Measure CSAT?
The timing of CSAT measurement is critical for accuracy. Best practices suggest:
Immediately After Interaction: Collect feedback when the experience is still fresh in the customer’s mind.
At Regular Intervals: For subscription-based services, CSAT can be measured quarterly to assess long-term satisfaction trends.
After Product or Service Updates: To measure how changes affect customer perception and adoption.
During High-Traffic Periods: For retail and e-commerce businesses, measuring CSAT during peak seasons provides valuable insights into service performance under pressure.
Calculating CSAT Score
To get an accurate picture of CSAT, businesses should first collect data and use a formula to get a score.
For example, if 200 customers respond to a survey and 160 of them select either 4 (satisfied) or 5 (very satisfied), the CSAT score would be:
CSAT Formulas
The above formula is the most basic and universal, but there are other variations as well. In addition to the standard CSAT calculation methods, businesses can use alternative approaches to gain deeper insights into customer satisfaction.
1. Average Score Method
This approach involves asking customers to rate their satisfaction on a scale from 1 to 10. This score is then calculated by dividing the sum of all customer scores by the sum of the maximum possible scores and multiplying by 100 to express it as a percentage. For example
Example:
If six customers provide the following CSAT ratings: 5, 7, 10, 3, 8, and 6, the calculation would be
Sum of All Scores: 5 + 7 + 10 + 3 + 8 + 6 = 39
Sum of Maximum Possible Scores: 6 respondents × 10 = 60
CSAT%: 39/60 x 100 = 65%
2. Happy vs. Unhappy Method
This is a more simplified approach that involves asking customers to select from options like happy, neutral, or unhappy, often represented by corresponding emojis or icons. This method offers a quick snapshot of customer sentiment. For example, if 43 customers respond and 30 select the happy icon, the calculation will be: 30/43 x 100 = 69,767
3. Star Rating Method
Commonly used by platforms like Amazon and Netflix, this method asks customers to rate their experience using a star system, typically from 1 to 5. For example, if 50 customers provide a total of 210 stars out of a possible 250, the calculation will be 210/250 x 100 = 84
Companies can experiment with different CSAT formulas to find the one that gives more granular information.
What is a Good CSAT Score?
Contact center performance metrics are not absolute for all industries. Each sector has its specifics, consumer expectations, and contact center role. So here is a golden rule: anything above 70% is a GOOD CSAT. Here is how we can also answer the question, “What is a good CSAT?”
80% and above: Considered excellent in most sectors.
70%-80%: Indicates solid performance but room for improvement.
Below 70%: Suggests a need for significant improvements.
For example, industries like e-commerce and hospitality tend to have higher CSAT expectations, while utility and insurance companies often see lower scores due to the nature of their interactions.
CSAT vs. NPS vs. CES
As said, CSAT is not the only contact center KPI (and not the only important one), and it is often compared with two other customer experience metrics:
Net Promoter Score (NPS): Measures customer loyalty by asking how likely a customer is to recommend a company.
Customer Effort Score (CES): Assesses how easy or difficult it is for a customer to interact with a business.
Those three customer satisfaction metrics are quite similar for a non-professional, but they are absolutely different. While CSAT captures short-term satisfaction, NPS analyzes long-term loyalty, and CES identifies friction in the customer journey. A combination of these metrics offers a more comprehensive understanding of customer experience.
What are the Challenges of Tracking CSAT?
Universally, tracking the customer satisfaction score is an advantage; it’s a must. But there are also cons to tracking CSAT that can affect decision-making.
Low Response Rates
A significant challenge in measuring CSAT is the low participation rate in customer satisfaction surveys. Many customers, due to time constraints or survey fatigue, choose not to provide feedback. This non-response can lead to inaccurate results.
Response Bias
Even when customers do respond, their feedback can be influenced by various biases. Cultural factors, personal values, and individual emotions at the time of response can all affect how customers rate their satisfaction. For example, people in individualistic countries like the US, most European countries, Australia, etc. may choose more extreme ratings compared to those in collectivistic cultures like China, Korea, or Mexico.
Subjectivity of Satisfaction
The concept of "satisfaction" is subjective, varying from one customer to another. What one customer considers satisfactory, another might view as inadequate. This subjectivity can lead to inconsistent responses, making it challenging to see the real picture.
Limited Depth of Feedback
CSAT surveys often consist of simple, direct questions that may not capture the full complexity of a customer's experience, even if the rating is from 1 to 10. Deeper issues or specific pain points might remain unidentified, limiting the effectiveness of any improvements based on CSAT data.
Overemphasis on Short-Term Sentiment
CSAT primarily measures immediate reactions to recent interactions or transactions. While this provides valuable real-time insights, it may not reflect long-term customer loyalty or overall brand perception.
Improving CSAT Score with Hecttor AI
Prioritizing the contact center as one of the most critical touchpoints means investing in its development. Integrating tools like Hecttor can contribute to significant improvement of all contact center performance metrics, including CSAT. Hecttor AI enhances CSAT scores by optimizing customer interactions through advanced speech speed adjustment and noise cancellation.
Faster Issue Resolution: With real-time speech speed adjustment, agents can understand and respond to customer inquiries more effectively, reducing Average Handling Time (AHT) and boosting First Call Resolution (FCR) rates.
Minimized Customer Repetition: Clearer conversations mean customers don’t have to repeat themselves, reducing frustration and improving their overall experience.
Lower Cognitive Load for Agents: By eliminating background noise and improving speech clarity, agents can focus on problem-solving rather than struggling to hear or interpret customer queries.
Conclusion
CSAT is more than just a number—it reflects how well a company meets its customers’ needs. By tracking this and many other metrics and improving them, businesses can enhance customer retention, optimize operations, and increase revenue without overspending on lead generation. In a customer-centric world, where customer experience is a key differentiator, integrating advanced tools like Hecttor AI can provide the capabilities necessary to stay ahead.