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How Do You Measure Customer Service Performance and Success? With 10 useful KPIs

Amritpal Dhangal
7 min read
How Do You Measure Customer Service Performance and Success? With 10 useful KPIs

‘The goal as a company is to have customer service that is not just the best but legendary’. Sam Walton

Wise words. But how do you achieve it?

Measure, measure, measure. Without measuring how can you understand progress?

Key Performance Indicators are your friends. Each metric has its specific uses. It’s down to you to employ these in a way that works best for your business.

Setting customer service KPIs

Key Performance Indicators help you measure performance versus set goals. They give the chance to understand the impacts.

For example, customer service insights show that increasing customer engagement by 50% leads to 80% improvement in customer retention. It might then be sensible to focus on setting customer engagement benchmarks to achieve higher retention rates.

KPIs can identify issues in need of addressing. Measuring customer satisfaction across multiple touch-points may reveal phone users are the least satisfied, whereas those using live chat are extremely satisfied. Makes sense then to incorporate live chat across all possible touch-points and encourage phone users towards live chat where they are likely to have a better experience.

Which KPIs are useful?

1. Net Promoter Score

“What gets measured gets managed.” – Peter Drucker

Net Promoter Score(NPS) is an index ranging from -100 to 100, measuring your customer's willingness to recommend your company to others. Essentially, it’s a proxy for customer satisfaction. It may even speak of brand loyalty.

Live Chat done? Don’t forget to ask for this feedback.

How is NPS calculated?

Customer feedback ratings are categorized as intopromoters, passives, and detractors.

nps net promoter score

Source: and

On a scale of 0 to 10, customer ratings between zero and six are categorized as detractors, seven and eight, passives, and nine or ten, promoters.

Net Promoter Score = % of promoters - % of detractors.

2. Customer retention

Customer retention programs must aim to retain the maximum number of customers. It’s vital in maintaining a successful business.

It starts with the very first contact and runs throughout the relationships lifetime.


To measure Customer Retention Rate (CRR), you will need three pieces of information:

  • Number of new customers in a given period (N)
  • Number of customers at the start of that period (S)
  • Number of customers at the end of that period (E)

Here’s a handy formula to measure CRR:

Customer Retention Rate = ((E-N)/S)*100

Even a 1% improvement in retention means a 5% profit increase per customer. Think about that. It’s easy to see why every organization must do what they can to maximize customer retention.

3. Conversion rate

Shows the percentage of users completing the desired action. Perhaps the percentage of website visitors purchasing on the site.

It cannot be understated how crucial conversion rates are for any business. Effectively addressing CR can save you big time when it comes to paid advertising and helps you when discovering your ideal customers. Better customer knowledge means the ability to further refine your marketing.

Conversion Rate = Number of Sales / Number of Visits x 100

Say an e-commerce site receives 200,000 visits in October. During that month, 4,000 users purchased online. Conversion rate:

4000/200000 * 100 = 2%.

4. Average Resolution Time

Time-to-resolution (TTR)allows companies to track the aver­age time it takes to solve customer issues. TTR is normally mea­sured in hours or days, depending on the nature of the business. It takes into account the time elapsed between the original request log and its closure.

Customer support teams are by their very nature tasked withkeepingTTRsshort.

resolution time

How is Average Resolution Time is calculated?

resolution time

Successful customer-oriented organizations incorporate strategies to minimize average resolution times at their very core.

5. Customer satisfaction surveys

Creating new customers costs 6/7 times more than retaining existing ones. Customer satisfaction then saves you money. And to obtain accurate satisfaction data means creating surveys.

Effective surveys contain 5 to 10 questions relating to customer experience, service delivery, and measure overall satisfaction.

Remember, a satisfied customer is a real asset.

On the flipside, unhappy customers are a problem. Why would they want to continue using your product or service?

Surveys help paint a picture of what’s going on with your customers. If you don’t know what bothers them, then how can you hope to improve?

Send emails to customers, linking to surveys, or even embedding them directly in the email. Use 5 to 10 question about their product or brand experience.

Check out this Amazon customer satisfaction survey:

customer satisfaction survey

Rate your recent Amazon experience and discuss with friends

  • Extremely helpful
  • Very helpful
  • Somewhat helpful
  • Not very helpful
  • Not at all helpful

6. Customer Satisfaction Score

Customer Satisfaction Score (CSAT) shows services and products meet or indeed surpass customer expectations.

customer satisfaction questions



CSAT is easilydeter­mined using one follow-up question. “How would you rate your over­all sat­is­fac­tion with the ser­vice?” Generally, this is graded on a scale of 1 “very unsatisfied” to 5 “very satisfied”.

7. Social media monitoring

Monitoring tools help understand what people are saying about you on social media. Insights like this paint a richer picture than simply relying on traditional media.

Available in the market are the likes of Keyhole, Addict-o-Matic, CyberAlert, Sysomos among others.

Social media monitoring can entail:

  • Online Analytics: Social media analytics tools collect data from social networking platforms like Facebook and Twitter, blogs, comment pages, and news feeds on media sites.
  • Buzz Analysis: Monitor online sources like internet forums, social networks, and blogs.
  • Social Media Intelligence: SMI refers to tools allowing companies to monitor social media channels and interactions. Social media intelligence is gathered from social media sites, using both intrusive and non-intrusive means, from open and closed social networks.

8. Customer engagement metrics

Customer engagement starts from the first touch point and incorporates subsequent interactions, including the time customers spend with your brand and the actions they take throughout their journey.

Customer engagement metrics are effective in measuring service accessibility and the quality of customer experience.

Activation rate is triggered when a visitor takes a specific action and become an active user.

This trigger could be time on the website, pages viewed, downloads, subscription, or even trial signup.

How do you calculate the activation rate?

(#) of user sessions / (#) activities completed by users = (%) Activation Rate


Identifying and defining your activation events. Only some actions reflect fulfillment of business goals; payment, upgrades, etc.

Which actions represent key phases in your customer journey lifecycle?

User actions should be:

  • Meaningful in terms of value.
  • A pivotal point or process inyour sales cycle.
  • A one-time event or instance.

Identify the patterns of a converted user, and figure out their actions. Record this and define as an activation event.

Some pro tips:

Simplify steps in the activation process. Create a one-step sign-up process if possible.

Re-engage users. Good support drastically improves the activation rate. Segment users who’ve recently signed up or left your site without making purchasing and prioritize them for support.

9. Monthly/daily active users

Active users give a clue to the success of your customer service approach.

Daily, Weekly and Monthly Active Users indicate who is actively using your product or service in a given time period.

Who exactly are active users?

Users interacting with your business within a specific period.

This is a very broad definition though. It may be more practical to break it down, considering every important point on the customer journey.

Have a look at this checklist:

  • Check the number of login attempts since the day of sign up.
  • Check the bounce rate.
  • Check the number of calls from user or conversations they had with your agent.
  • Define the characteristics of an active user. A third-party app or an e-commerce store is a potential characteristic of an active account.


Using D1, D7 and D30 metrics, to see who has gone inactive since the onboarding process. Particularly 1 day, 7 days and 30 days after signing up or installing your app.

A customer survey at these critical points will glean valuable information for your customer support approach.

Pro tip:

Segment out, fake users. Getting 30 sign ups a day may mean a section of them are spam. Taking them out of the picture adds clarity.

10. Conversation abandonment rate

One of the most important yet overlooked customer service metrics, this shows abandoned interactions across social media, phone calls, live chat, and email.

These abandonments provide invaluable insights into customer behavior.

Segment customer conversation by channels. Consider whether they are text-based or voice-based.

Segmenting text-based conversations on the basis of channel help analyze:

  • The number of customer requests per channel.
  • How many agents are needed to handle a particular channel and meet KPI and SLA requirements?
  • The number of concurrent requests an agent is capable of handling.
  • Any requirement to add an extra channel.
  • The nature of the inquiries; perhaps they can be handled with automation.

Calculating Voice-based customer conversations helps you analyze:

  • The total volume of voice-based customer requests.
  • The typical length of conversations and cost attached.
  • The typical response time of agents.
  • First contact resolutions.

What does it all mean?

These metrics will help you measure customer service success. At the end of the day, the customer is the king, so striving to provide the best customer service is a no brainer when it comes to ensuring success. Keeping a keen eye on these measurements provides the insights needed to improve the process and improve your business.

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