Loyalty
Customer Loyalty is a user’s devotion to a brand or product. It means that, all else being equal, the user will choose your product over alternatives. This choice is often emotional — a user who is genuinely in love with a product will recommend it to friends and family.
The standard metric for measuring customer loyalty is NPS (Net Promoter Score). Its growth positively correlates with sales growth and market share expansion. This relationship, combined with the simplicity of measurement, is exactly what made NPS so widely adopted. That said, the metric has its fair share of pitfalls — here’s a solid article on the subject: «12 подводных камней Net Promoter Score».
There is also a notable study, «The use of Net Promoter Score (NPS) to predict sales growth: insights from an empirical investigation», in which a group of researchers established and quantitatively confirmed the positive correlation between NPS growth and sales.
Satisfaction
Customer Satisfaction is the degree to which a user’s expectations of interacting with a product match their actual experience. An important nuance here is that a regular user may encounter problems at certain stages of the CJM (Customer Journey Map) while having a completely smooth experience at others.
For example, imagine you decide to use Yandex Taxi, but your driver is speeding recklessly, putting other road users at risk.
Will you be satisfied with the service at the end of that ride? Probably not — you’ll give the driver a low rating, and your satisfaction score will be low. In moments like these, a well-run service will try to gather details about the issue so it can be addressed.
But will your loyalty to the service or product change? Not necessarily. If your previous rides have been comfortable, it likely won’t. And if the company refunds your fare or sends you a promo code for the next ride, your loyalty might actually increase. This is a hypothetical example of a situation where satisfaction is low, but loyalty remains high.
One of the most widely used metrics for measuring satisfaction is the CSI (Customer Satisfaction Index).
Key Takeaways
- CSI is a tactical metric; NPS is a strategic one.
- Growth in CSI positively correlates with NPS.
- CSI measures satisfaction at individual stages of the CJM, while NPS reflects the overall perception of the product as a whole.
- CSI is a rational, evaluative metric; NPS is an emotional one.
- Both CSI and NPS positively correlate with sales.