How do you define your customer health score? Your customer health score will depend on how you answer these questions: How do you rate the experience of your customers? Do they come back to purchase from you repeatedly? How satisfied are they with your service? What is their lifetime value? Customer health score measures the answers to these questions and can help us determine if you are doing your job well enough to keep your customers satisfied and happy with their experience of your business. How can you use customer health score to predict if your customers will churn or stay with you as loyal customers?
Define the components of success
For every customer, there are three components that need to be looked at: Customer Success, Customer Experience and Customer Journey.
Measure each component
Customer Success – 20% of your overall health score. This is related to how good you are in assisting your customers on their journey? (You can use Net Promoter, NPS for measuring customer success here). How satisfied customers are with your product or service. How many customers have bought a product more than once from you? Do they refer others to you? Are they satisfied with what they get in return and how much it costs them?
Customer Experience – 60% of your overall health score. What is my experience like when I buy something from your company? How easy is it to reach out and find someone who will help me if I need assistance or need information about a certain part of your process that I am not sure about? Is there anything preventing me from giving 5-star reviews consistently every time I am interacting with someone at your organization via email, phone or in person? If yes, then how do we go about fixing those issues.
Customer Journey – 20% of your overall health score. What does a typical customer look like on their journey that starts when they hear about us and ends when they leave us completely satisfied whether by choice or because your product/service has stopped working for them or wasn’t relevant anymore. How likely are they to share their experiences within social media (whether positive or negative)? How frequently do they contact us seeking assistance? How likely are they to respond favorably if I approach them for feedback?
Identify high-risk groups
In order to determine your customer health score, you first need to identify which customers are high-risk and which ones are low-risk. High-risk customers will have a higher likelihood of churning, so you’ll want to pay extra attention to them. To do that, use an analytics solution like Zendesk Analytics or HubSpot Sales. This way, you can track not only whether a customer has churned in the past but also how engaged they are over time.
Prioritize improvements for highest ROI
It’s great if you can implement a new customer facing optimization, but not all improvements are created equal. When prioritizing, look for opportunities that will have the highest Return on Investment (ROI) for your business. The worst kind of improvement is one that’s costly with little or no return.