Why do you think multimillion-dollar companies like Amazon and Netflix are able to retain this huge customer base with high satisfaction levels? Netflix has an industry-leading retention rate of 93%, 75% for Amazon Prime Video, and 64% for Hulu. All this can be done only by focusing on customer journey metrics.
Customer journey is the roadmap of every interaction a customer has with a brand. By understanding this journey, businesses can tailor experiences that meet and exceed customer expectations. Crucially, the effectiveness of these journeys isn't based on guesswork.
Metrics play a pivotal role, providing the compass that guides businesses in aligning these journeys with business objectives and customer goals. Let’s dive into why these insights are indispensable for any thriving business.
Understanding Customer Journey Metrics
Customer journey metrics specifically measure the performance and effectiveness of the customer experience at various stages of their interaction with a brand. The famous American business magnate Sam Walton said, “There’s only one boss: the customer,” so it is crucial to focus on the customer experience.
These metrics help businesses identify pain points, highlight opportunities for improvement, and optimize the customer experience for better engagement and conversion rates.
The difference between customer journey analytics and traditional metrics
While traditional metrics focus on broad outcomes like sales volume or website traffic, customer journey analytics delve deeper into understanding the customer's path and behavior. This approach highlights outcomes and the processes that lead to these outcomes, offering a more granular view of the customer's experience.
Here’s a simple table to illustrate the differences between customer journey metrics and traditional metrics:
Also read: Creating User Journey Maps: A Step-by-Step Guide
15 Essential Customer Journey Metrics to Track
Now, it's time to look at the main metrics of the customer journey. First, let’s divide them under each stage, and then let’s get into each customer journey metric individually.
Awareness Stage
- Impressions to assess initial customer interactions
- Click-through rate to gauge the effectiveness of various communication channels
- SEO ranking to monitor and improve product visibility on search engine results
Activation Stage
- Onboarding completion rate to see if users are experiencing initial value
- Free-to-paid conversion rate to assess if enough users find the product worth it
- New user growth to evaluate if the product is expanding
Adoption Stage
- Product usage to understand how customers interact with the product
- Feature adoption rate to see if users are engaging with specific features
- Customer Effort Score (CES) to assess the perceived effort for interacting with the product
Retention Stage
- Customer satisfaction to assess user contentment
- Lifetime value to understand revenue generated per customer
- Retention rate to assess the ability to keep customers
- Churn rate to understand how many users leave and why
Referral Stage
- Net Promoter Score (NPS) to measure customer loyalty and satisfaction
- Reviews and ratings to gather testimonials and build advocacy
- Impressions
Impressions refer to the number of times your content, advertisement, or product is seen by potential customers. Tracking impressions helps you understand how many people are being exposed to your brand. This is important because it gives you a sense of the size of your potential audience. If you're not getting enough impressions, it could mean that your marketing efforts are not reaching enough people.
- Click-through rate
Click-through rate (CTR) measures the number of times users click on a link or advertisement compared to the total number of times it was shown (impressions). A high CTR indicates that your marketing content resonates with your target audience and drives them to take the next step in the customer journey.
On the other hand, a low CTR may suggest that your content or messaging needs to be optimized to capture attention and interest better. Tracking CTR helps you understand your marketing efforts' effectiveness and identify areas for improvement as customers move through the awareness stage.
We offer various features like in-app messages and many others that will help you to increase CTR. Here are all the features:
- Checklists - Make smooth user onboarding processes by breaking down steps to get started into simple chunks.
- Walkthroughs - Guide users through the app with a series of personalized tooltips to take them from one action to the other.
- Spotlight - Improve adoption and discoverability of features to drive conversions and purchases.
- In-app messages - Boost more conversions and completed purchases by using in-app messages at the right place and time.
- Coachmarks - Grab your users’ attention to specific features using contextual coachmarks.
- SEO ranking
SEO ranking is the best thing you can opt for for your webpage. This customer journey metric measures how high your website appears in search engine results for relevant keywords. A high SEO ranking means more potential customers will see your product or service when searching online.
This increases the chances of them clicking through to your website and taking the next step in the customer journey. Tracking SEO ranking helps you understand how visible your brand is to your target audience. It also allows you to identify areas for improvement in your SEO strategy to drive more traffic and leads.
- Onboarding completion rate
The onboarding completion rate measures how many new users successfully complete the onboarding process and start using your product or service. A high onboarding completion rate indicates that your onboarding process is effective and engaging. It means that new users find value in your product and are motivated to continue using it.
Tracking the onboarding completion rate helps you identify areas where users may be dropping off and where you can improve the onboarding experience. This is important because a smooth onboarding process can lead to higher user engagement and retention in the long run.
With our onboarding tour, building guided onboarding tours for users to take them through the main functionalities of the product becomes easy.
- Free-to-paid conversion rate
The free-to-paid conversion rate measures the percentage of users who transition from a free trial of a product or service to a paid subscription. This metric is important because it shows how effectively your free trial converts potential customers into paying ones. A high free-to-paid conversion rate indicates that your product provides enough value during the trial period to convince users to become paying customers.
On the other hand, a low conversion rate may suggest issues with your product, pricing, or trial experience that prevent users from seeing enough value to convert. Tracking this metric can help you identify areas for improvement to boost your overall customer acquisition.
- New user growth
New user growth is a key customer journey metric in the activation stage. It measures the percentage of new users who start using your product or service. Tracking new user growth helps you understand if your product is expanding and attracting new customers. A high new user growth rate indicates that your activation efforts, such as onboarding and free trials, are effective in converting potential customers into active users.
- Product usage
Product usage measures how often and how extensively your customers are using your product or service. Tracking product usage helps you understand if your customers are finding value in your offering and engaging with it regularly. A high level of product usage indicates that your customers are deriving benefits from your product and are likely to continue using it.
- Feature adoption rate
This key customer journey metric measures the percentage of users who start using a new feature or product after it is introduced. A high feature adoption rate indicates that users find the new feature valuable and are integrating it into their regular usage of the product. This is important because it shows the new feature is meeting customer needs and driving engagement.
With our spotlight and coachmark features, you can improve feature adoption and discoverability of features to drive conversions and purchases.
- Customer Effort Score (CES)
Customer Effort Score (CES) is a vital customer journey metric that measures the ease of experience customers have when interacting with a brand. It asks customers to rate how much effort they had to put in to resolve an issue, complete a transaction, or get support.
A low CES indicates that customers find it easy to engage with the brand, while a high score suggests friction and potential dissatisfaction. Monitoring CES helps businesses pinpoint areas where they can simplify processes, improve customer service, and enhance overall satisfaction by reducing the effort customers need to expend.
- Customer satisfaction
Customer satisfaction is all about how happy and content customers are with a product, service, or overall experience. Typically assessed through surveys or feedback forms, it provides valuable insights into whether customers' expectations are being met or exceeded.
High customer satisfaction indicates strong relationships, loyalty, and potential for repeat business and referrals. It's essential for businesses to regularly monitor and improve satisfaction levels to maintain customer trust and enhance their overall journey, ensuring that every interaction leaves a positive impression.
Want to assess how satisfied your users are with the products and services? Use our survey feature and conduct surveys to collect user feedback and tailor user experience. Choose from multiple types of questions and set up the logic for each of them right inside the dashboard.
Also read: 10 Important Metrics to Boost User Satisfaction
- Lifetime value
Customer Lifetime Value (CLV) is a customer journey metric that estimates the total revenue a business can expect from a single customer over their entire relationship. It takes into account how much a customer spends, how often they purchase, and their lifespan as a customer. CLV helps businesses prioritize customer retention strategies and allocate resources effectively.
By understanding the long-term value of each customer, businesses can tailor their marketing efforts, improve customer experiences, and maximize profitability. Increasing CLV involves nurturing relationships, enhancing satisfaction, and encouraging repeat purchases, all of which contribute to sustainable growth and profitability.
- Retention rate
Retention rate is a critical customer journey metric because it is highly associated with customer loyalty and satisfaction, indicating how well a business retains its customer base. A high retention rate suggests that customers are happy and engaged, leading to stable revenue and growth. Businesses can improve retention by offering exceptional customer service, personalized experiences, and addressing customer feedback. Monitoring retention rate helps businesses identify trends, understand customer behavior, and implement strategies.
With our engagement feature, you can craft sticky user experiences that foster retention and make users return using challenges, point systems, streaks, stories, casual games, polls, quizzes, and more.
- Churn rate
The churn rate measures the percentage of customers who stop using your product or service over a given period. A high churn rate indicates that you're losing customers at a rapid pace, which can be detrimental to your business.
This could be due to a variety of factors, such as poor customer service, lack of product updates, or competition from other providers. By tracking the churn rate, you can identify the reasons why customers are leaving and take steps to address those issues, ultimately improving customer retention and loyalty.
- Net Promoter Score (NPS)
This customer loyalty metric measures satisfaction based on a simple question: "How likely are you to recommend our product/service to a friend or colleague?" Customers respond on a scale from 0 to 10, categorizing them as Promoters (9-10), Passives (7-8), or Detractors (0-6). NPS is calculated by subtracting the percentage of Detractors from the percentage of Promoters.
A high NPS indicates strong customer advocacy and loyalty, while a low score suggests areas needing improvement. Monitoring NPS helps businesses gauge customer sentiment, identify areas for enhancement, and foster positive word-of-mouth marketing.
- Reviews and ratings
Customers often leave reviews and ratings based on their experiences, providing valuable feedback for potential buyers. Positive reviews and high ratings can enhance credibility, trust, and influence purchasing decisions, driving new customer acquisition.
Conversely, negative reviews can highlight areas needing improvement and impact brand reputation. Monitoring reviews and ratings help businesses understand customer sentiment, identify strengths and weaknesses, and take proactive steps to enhance customer satisfaction and loyalty, ultimately shaping the overall customer journey positively.
How to Choose the Right Customer Journey Metrics
Now that you know the major customer journey metrics, it's time to understand how to pick the right metric to focus on based on the requirements of your business. Here are some ways that you can follow:
1. Aligning metrics with specific journey stages
Tailor metrics to each customer journey stage—from awareness, consideration, and decision to retention and advocacy. For example, metrics like website visits or social media engagement can be used to increase awareness, conversion rates for decision-making stages, and retention rates for post-purchase phases. This ensures you capture and analyze customer interactions effectively throughout their journey.
2. Using a balanced scorecard approach
Adopt a balanced mix of metrics encompassing different customer experience dimensions. Include metrics for customer satisfaction (NPS, CSAT), behavioral metrics (conversion rate, repeat purchase rate), and operational metrics (CES, response time). This approach provides a comprehensive view, helping you understand the customer journey's qualitative and quantitative aspects.
3. Relevance to customer and business goals
Prioritize metrics that directly impact customer satisfaction and align with your business objectives. For instance, if increasing customer retention is a goal, focus on metrics like churn rate and customer lifetime value (CLV). Ensure each metric chosen contributes to enhancing overall customer experience and supports strategic business outcomes.
4. Balance of leading and lagging indicators
Incorporate a mix of leading indicators (predictive metrics) and lagging indicators (historical metrics). Leading indicators, such as engagement metrics or customer feedback trends, help anticipate future customer behavior and enable proactive adjustments to improve the journey. Lagging indicators, such as retention rates or sales figures, provide insights into current performance and outcomes, guiding immediate actions and long-term strategies.
Tools and Techniques for Measuring Customer Journey Metrics
“Focusing on the customer makes a company more resilient.”
- Jeff Bezos [Amazon CEO]
At the end of everything, you need to know whether the strategies you have implemented are working or not. Here are some ways to measure whether your customer journey metrics are working properly!
1. Utilizing customer data platforms (CDPs) and customer engagement platforms (CEPs)
CDPs and CEPs help gather and integrate customer data from various touchpoints like websites, emails, and social media. They provide a unified view of customer interactions, enabling businesses to analyze and optimize the entire journey seamlessly.
2. Benefits of using analytics and business intelligence tools
Analytics tools offer insights into customer behavior, trends, and performance metrics across different stages of the journey. Business intelligence tools help interpret data, identify patterns, and make data-driven decisions to improve customer experiences.
We can transform your data into actionable insights by offering advanced analytical features. With Nudge, you can track key performance indicators, uncover trends, and make data-driven decisions.
3. Incorporating multi-touch attribution models
Multi-touch attribution models attribute value to each touchpoint in the customer journey, acknowledging the influence of various interactions on customer decisions. This helps businesses allocate resources effectively and optimize marketing strategies.
4. Using heatmaps and session recordings for qualitative analysis
Heatmaps visualize user interaction patterns on web pages, highlighting where users click, scroll, or linger. Session recordings capture real-time user sessions, providing insights into user behavior, pain points, and opportunities for improvement. These qualitative tools complement quantitative data, offering deeper understanding and context to enhance the overall customer journey.
5. Some formulas
- Customer Satisfaction Score = sum of satisfaction ratings ÷ total number of responses
- Customer Lifetime Value = (annual revenue per customer x customer lifespan in years) – customer acquisition cost
- Customer Effort Score = sum of effort ratings ÷ total number of responses
- Conversion rate = (number of users who completed a specific action ÷ number of users you exposed to that option) x 100
Conclusion
“Customer experience isn’t an expense. Managing customer experience bolsters your brand.”
- Stan Phelps [Author]
In a nutshell, mastering tracking and measuring are the keys to refining the customer journey. By consistently monitoring metrics, businesses can pinpoint strengths and areas for improvement, fostering better experiences and loyalty. Encouraging a data-driven culture empowers teams to make informed decisions based on insights, enhancing overall strategy and customer satisfaction.
Staying agile in response to customer journey analytics ensures businesses remain adaptable to evolving customer needs and market dynamics. This proactive approach drives immediate improvements and lays a foundation for sustained growth and competitive advantage in the long term.
Book a demo with us to create a customer journey for users to increase satisfaction level and user retention.