CSAT vs. NPS: Differences, Formulas, Examples

Customer satisfaction is the holy grail of any SaaS business. But how do you truly measure it? Enter CSAT and NPS, two powerful metrics that can shed light on your customer experience.

Here, we’ll explain each metric, the differences and similarities between NPS and CSAT, and we will provide formulae and examples to calculate the customer satisfaction and net promoter score so you can adjust your strategy.

What is a CSAT (Customer Satisfaction Score)?

Customer satisfaction score (CSAT) is a metric used to evaluate the customer satisfaction level with your service or product, and overall experience. It’s usually measured by acquiring data from customer feedback forms or surveys with a question to rate their satisfaction by selecting a certain option or a number on a scale.

CSAT metrics are used at multiple touchpoints in the customer journey, for example, after the purchase, successful completion of tasks, or interaction with the customer support team. Also, by analysing CSAT scores frequently, you can track changes in customer satisfaction levels and assess the effectiveness of, for example, a new feature to improve the customer experience. 

Armed with relevant customer satisfaction data, you can make data-driven decisions to refine your service, product, and processes.

What is a Good CSAT Score?

A good CSAT score changes depending on a few things, such as the nature of the survey, industry standards, and company standards. However, there are some general guidelines for interpreting CSAT scores. 

• For instance, if 90-100 percent of respondents said they were completely satisfied, then their expectations have been exceeded and the satisfaction level is high.
• 80-89 percent also shows a good mark and suggests that customers are generally pleased, but with some small areas that could be improved. 
• An average satisfaction level lies between 70 and 79 percent, which denotes more areas for improvement. Below this threshold indicates low satisfaction levels with serious problems requiring immediate intervention.

What is NPS (Net Promoter Score)?

The NPS metrics show customer loyalty and the likelihood that customers will recommend your product to other people. It gives information on the general satisfaction of consumers and brand advocacy. With this data, you can identify weak aspects of your retention and customer success programs.

NPS is measured with a question that usually appears as “How likely are you to recommend a company/service/product to a colleague or friend?”. Customers select their replies by ticking any number from 0-10. After that, they are divided into three groups;

• Promoters (9-10)  are very happy with it and would be ready to recommend it; 
• Passives (7-8), who are generally satisfied but slightly reluctant when promoting your firm actively;
• Detractors (0-6), are those who are unhappy with your service/product and might share negative stories about it.

What is a Good Net Promoter Score?

Like CSAT, for an NPS score to be considered good, several factors need to be taken into account,  such as industry norms and customer bases. However, here are the general guidelines for its interpretation. 

• If the NPS is above 50 (excellent), that indicates solid customer loyalty and advocacy, with minimal detractors. 
• If the NPS metrics show a score between 30 and 50 (good), the customers feel positive about your brand in general, with relatively few detractors.
• The average score is between 0 and 30, and it indicates a fairly balanced mix of promoters and detractors.
• The one that goes below 0 (poor) reflects a negative customer sentiment, with more detractors than promoters. This is the time to immediately address the critical issues to improve customer satisfaction.

How to Calculate Customer Satisfaction (CSAT)?

In order to calculate CSAT, determine the number of positive responses and the total customer survey responses. Then, divide those two values and multiply this quotient by 100 to get the percentage. 

Example: You chose to administer a survey that involves 100 customers. Your query refers to their satisfaction levels; specifically, and you requested ratings on a scale from one through five, with five representing the pinnacle of customer contentment.

So, we have the current total customer count of 100, and survey results reveal that 70 responses fall within a positive rating (4 or 5). 

Applying the formula:

1. Dividing positive responses by our overall number (70/100)
2. The previous yields a quotient of 0.70
3. Multiply 0.70 with 100 and you get a CSAT score of 70 percent. The score reflects an average level of satisfaction, suggesting potential for enhancement. 

How to Calculate Net Promoter Score (NPS)?

To calculate NPS, first, you need to categorize them into those three types we mentioned earlier, and this should be based on the survey report: promoters, passives, and detractors. Additionally, it is important to calculate the percentage of promoters and detractors by subtracting the percentage of detractors from the percentage of promoters.

The whole thing will become more clear as soon as you see an example:

Let’s suppose that you sent out a survey to 100 customers. Out of these 100, 50 were promoters, 30 were passives, and 20 were unlikable detractors.

So, do the following to calculate NPS:

1. Divide the number of promoters by the total respondents, then multiply it by 100. Let’s say there would be fifty percent.
2. Divide the number of detractors by the total number of respondents. Let’s say there would be twenty percent of detractors. 
3. Lastly, subtract the percentage of promoters from the detractors and you’ll get your NPS score.

CSAT vs. NPS: What are the differences and similarities? 

The main differences between net promoter score vs customer satisfaction are their focus, survey questions, calculation formulas, and interpretations.

Now, let’s see where they are similar. They both require customer feedback to be measured properly. Also, they provide quantitative metrics that can be tracked over time to detect changes in customer loyalty and satisfaction. One of the surest ways to get the right metrics and proper data is to use customer success platforms. Besides advanced customer segmentation options, Akita enables customer health monitoring, and automated alerts and notifications, with Akita, you get robust analytics and reporting capabilities that can give you insight into customer behaviour.

When it comes to similarities, both CSAT and NPS have a customer-centric focus with the goal of gaining insight into how to meet customer needs, drive more satisfaction, and foster long-term relationships. 

CSAT vs. NPS — Conclusion

Although NPS vs CSAT  differ in focus, formulas, and applications, their ultimate goal remains the same – assessing how customers feel about your company. While CSAT measures overall customer satisfaction, NPS metrics delve into customer loyalty and brand advocacy by measuring the likelihood of recommendation. Use Akita to get precise scores and make data-driven decisions to improve satisfaction and retention.