10 Key KPIs for Evaluating Your Customer Service Team

When managing an e-commerce business, it’s important to know how successful your efforts are across all business functions. That includes knowing how well the customer service team is doing. And most importantly, how their performance is affecting customers. 

We all have good and bad days, and it’s natural for the performance of human beings to vary from time to time. Unfortunately, a bad performance from the customer service team can have a negative effect on customers. This can affect customer loyalty or lead to negative reviews. To avoid this, it’s important to know the areas customer service teams are doing well in and the ones they’re struggling with. 

This is where key performance indicators (KPIs) come in handy. KPIs are measurements that allow a company to track the success of their operations. They help firms see if they’re on the way to achieving their objectives.

For example, if an aim is to increase customer service and customer loyalty through using video conferencing, KPIs will help you figure out if you’ve done this. Using a KPI such as Customer Retention Rate (CRR) will enable you to see if indeed, video conferencing helps you keep customers in the long term. We will talk about CRR in more detail later. 

KPIs can help managers see how well their employees and systems are performing. Used appropriately, they can help your team figure out what they can do to improve their performance. Whether you made or missed your KPI may be an indicator that you need to try a new strategy—like implementing an automated customer service platform or investing in good customer service software that can help you track all the important customer service metrics.  

With this in mind, here are 10 key KPIs for e-commerce to use when evaluating your customer service team. 

1. Customer Satisfaction (CSAT) Score

We all keep the customer at the heart of what we do. Providing a better customer experience leads to repeat customers, good reviews and a strong brand. One way to monitor this is the Customer Satisfaction score. It’s a great way to find out how customers really feel about your products and services. 

There’s a reason this measurement is also known as the Happy Customer KPI. This is because it generally measures the satisfaction of the customer after shopping. 

To measure this KPI after a purchase, you can ask a question along the lines of:

“How would you rate your overall satisfaction with the product/service you used?”

Or in the case of measuring customer service, you could ask:

“How satisfied were you with the customer service you received with your most recent interaction?”

Respondents can then answer from a scale of choices. The final percentage is worked out by taking only the high-satisfaction responses into account (for example, scores that indicate being satisfied or very satisfied), dividing them by the number of overall responses, and multiplying that number by 100. This is usually represented as a percentage and follow-up questions can be asked if needed.

It could be that your customer service team has just answered a question about your products. Or your sales team has been on a call using sales discovery questions. Whatever it is, asking the client this follow up question as a customer service KPI will help you learn a lot about your staff. 

2. First Response Time (FRT)

If questions aren’t answered straight away, there’s a good chance the client will leave your website. Dialogtech suggests 59% of customers are more likely to buy from you when their question is answered in under a minute.  

The FRT is the time between the customer making the query and an agent responding to them. Answering questions quickly helps optimize customer experience. If a question is answered quickly, it implies the agent is eager to help the client. The better the score, the more satisfied a customer and the better job the agent is doing.  

FRT is calculated using the following formula:  Time of first response – Time of customer request = FRT

3. Net Promoter Score (NPS)

NPS monitors how likely customers are to recommend your brand to others. This is measured by asking: 

“How likely are you to recommend our company/service to somebody?”

We’ve all probably been asked this question ourselves after working with customer service agents. Similar to CSAT,  a scoring system is used. 

Someone who is highly likely to recommend the brand will score a nine. And on the opposite end, a person who would actively put people off your brand would score a zero. You split the responses into three categories:

• Promoters: people who answered 9 or 10

• Passives: people who answered 7 or 8

• Detractors: people who answered between 0 and 6

Subtracting the percentage of detractors from the percentage of promoters gives you the NPS.

The higher a score, the better the business tends to be doing, and the better the interaction with the customer service representatives will have been. Whereas low scores imply bad customer service and can be investigated. 

To help train people who are receiving bad scores, use customer review examples. Pick out the areas customers are most critical of, and focus on improving them. For instance, if they note it takes a long time to get a response, you can work on your response time. Then, when customers are asked the above question in the future, hopefully, scores will go up. 

A similar but different metric to consider here is customer effort score which is a way of measuring how difficult it was to achieve the desired outcome.

4. Active Issues

It’s always a good idea to monitor the active number of issues logged to the help desk. If problems are being solved straight away, then the number of active issues won’t be high. 

However, if these problems aren’t being resolved the number of active issues will increase. And that means the number of unhappy customers will grow with it. If this is the case, it should be investigated. It may be an issue with a product, or staff may need retraining.

When working remotely, something like a virtual office phone service can help managers keep in touch with their team. Regular check-ins can help managers see if there are certain areas their staff is struggling with. That way, staff can mention problem areas and work on average resolution time—keeping active issues down.

5. Resolved Issues

Adding to the previous point, it’s also a good idea to monitor the number of resolved issues. It will be easier to look at these numbers over a specific amount of time, rather than on a daily basis. Looking at resolved issues also helps to see the biggest problem areas, how hard the customer service team is working, and any trends to stay on top of. 

Monitoring resolved issues as a customer care KPI can even help create an effective marketing campaign. This is because you can see the areas where the staff is having successful interactions with people. You can then focus on that area to target in your marketing campaign. 

For example, say most questions are being asked and answered on Facebook. You know that’s where a high number of customers are going. The marketing team can then create an ad that targets the customers visiting your Facebook page.

It’s also a useful metric for improving your help pages. If you have a common issue coming up, then you may want to add it to your FAQs or knowledge hub. This means customers can resolve the issue themselves, freeing up your team's time for more complex problems.

6. Escalation Rate

Let's build on the previous two points even more. Monitoring escalation rates will help you see which problems are difficult to resolve and end up needing additional interaction to resolve. This metric tracks when a customer contacts an agent with an issue and is escalated to the next stage and beyond. 

If there is a rise in escalation rates, it could mean there's a bigger problem somewhere. For example, an influx of inbound calls may result in an increase in unhappy customers who can’t get through to speak with someone.

Hiring more staff more can help with this. Alternatively, using something like using a call forwarding service can also help. Because it means customer calls are less likely to be missed, the issue is dealt with sooner and problems won’t be escalated so much.

Equally, it could be a particularly complicated technical issue that first tier staff isn’t equipped to resolve. In this case, the solution would be to improve your training and potentially focus on hiring more supervisors.

7. Customer Retention Rate (CRR)

Whether you’re a start-up or an enterprise e-commerce firm, it’s never a bad thing to get more customers. We tend to target our strategies at getting new customers, and this is great for brand visibility. 

However, many companies don’t focus enough on retaining customers - and this is where things can fall apart a bit. 

Giving customers great customer service can help with this issue a lot. Think about it, if you had a choice, would you rather shop somewhere where the staff is helpful and polite? Or somewhere they ignore you and don’t answer your questions? 

Providing customers with excellent service will make them want to stay with you forever. This is why CRR is so important for an e-commerce company. 

CRR can be figured out by using the following formula: 

Customer Retention Rate = ((CE – CN) / CS)) x 100

CE is the number of customers in the end of a given time period 

CN is the number of new customers acquired during that time 

CS is the number of customers at the beginning 

The higher the outcome, the more attentive the customer service team will have been - and the better your business will do in the long run.

8. Cost Per Conversation

It’s important to find out how much customer support is costing you. Therefore, you should compare support costs to total revenue and ensure the customer service team is adding to that revenue. 

If lots of problems occur, you lose customers and have to retrain your staff. Additionally, if your staff are unhappy they’re likely to leave and you’ll have to hire new people. Neither of these outcomes are beneficial to your income. 

Consider too, though, that problems happening in this area may not always be the fault of the staff. They could have had bad training, or a particular product may be faulty. This would still lead to a lot of complaints to manage.

It could even be that there simply isn’t enough staff to talk to clients, so they give up before getting connected. If you’ve scheduled call-backs, using a call center predictive dialer can increase the efficiency of your agents. This in turn will help build on profits. 

9. Abandoned Call Rate

A really good way to measure your percentage of satisfied customers is to look at abandoned call rates and reasons for abandonment. 

The biggest reason people tend to give up on calls is long wait times to speak to an agent, which leads to frustration. Measuring call abandonment lets you create the right strategies as a team to get customers the help they want. It also means you can train service agents in the right places to speed up answer times. 

Research why customers are abandoning service calls. Can you solve their issue on your website? Are you missing the mark on another channel that’s driving them to call? Consider all ways you can reduce call volume to minimize the load on your customer service team.

Remember that in theory, the lower the abandon rate, the happier the customer. 

10. Analysis of Channel Performance

Many businesses use a range of channels to spread the word and target customers. For example, they may send newsletters and use video marketing on social media. 

Measuring customer service performance by channel is key to know where to spend time and money. For example, if Facebook chat leads to much more frequent positive outcomes, encourage customers to use that channel and train staff members to respond properly.  Or if using different forms of customer support content, like a Shopify tutorial video, could be an engaging avenue to explore. 

Using an e-commerce KPI to evaluate your customer service team is all about optimization on an individual and team level. It’s about seeing where things are going wrong and taking meaningful steps to correct courses from hiring and training to ongoing management and optimization. 

Exploring these customer satisfaction KPI examples will help you know where to train employees and where to improve customer services. In turn, this will give your brand a great name and bring in higher revenue.