Business Glossary: Key Terms
Definition of Customer satisfaction
What is customer satisfaction?
Customer satisfaction is the degree to which a company's products, services, or experiences meet or exceed customer expectations. It reflects how happy customers are with what they receive and how they feel about their interactions with your brand. High customer satisfaction means clients are more likely to return, recommend your business, and become loyal advocates, while low satisfaction can lead to churn and negative word-of-mouth.
In today's competitive landscape, understanding what customer satisfaction is becomes essential for building lasting relationships and driving sustainable growth.
Why is customer satisfaction important?
Customer satisfaction is a cornerstone of business success for several reasons:
- Drives loyalty and retention by ensuring satisfied customers are more likely to stay with your brand and make repeat purchases.
- Boosts referrals by turning happy customers into brand ambassadors who spread positive reviews and bring in new clients.
- Reduces churn by preventing dissatisfied customers from leaving, which would cost your business more in acquisition efforts.
- Increases revenue as businesses with high customer satisfaction typically see higher lifetime value and increased sales.
- Supports innovation by providing customer feedback that highlights opportunities for improvement and new product development.
Ultimately, customer satisfaction is important because it directly impacts profitability, reputation, and your ability to compete in the market.
How to measure customer satisfaction?
Measuring customer satisfaction involves gathering feedback and analyzing data to understand how well you're meeting customer needs. Here's how to approach it:
What types of metrics measure customer satisfaction?
- Customer Satisfaction Score (CSAT): Customers rate their satisfaction with a specific interaction, usually on a scale of 1–5 or 1–10.
- Net Promoter Score (NPS): Measures the likelihood that customers would recommend your company to others, typically on a 0–10 scale.
- Customer Effort Score (CES): Assesses how easy it was for customers to resolve their issue or complete a transaction.
- Churn Rate: The percentage of customers who stop using your product or service over a given period.
- Repeat Purchase Rate: Tracks how often customers return to buy again.
These metrics provide actionable insights into what drives satisfaction and where improvements are needed.
How to calculate customer satisfaction?
- CSAT:
CSAT = (Number of satisfied responses / Total responses) x 100
For example, if 80 out of 100 respondents rate their experience as "satisfied" or "very satisfied," your CSAT is 80%.
- NPS:
Subtract the percentage of detractors (0–6) from the percentage of promoters (9–10).
NPS = %Promoters - %Detractors
A positive NPS indicates more promoters than detractors.
- CES:
Calculated as the average score from customer responses to questions like, "How easy was it to resolve your issue?"
Calculating these scores regularly helps you track trends and quickly respond to changing customer needs.
What customer satisfaction score is good?
CSAT: A score above 75% is generally considered strong, though benchmarks vary by industry.
NPS: An NPS above 0 is good, 30+ is great, and 70+ is world-class.
CES: Lower scores (indicating less effort required) are better.
A good customer satisfaction score meets or exceeds your industry's average and shows consistent improvement over time. Always compare your results to sector benchmarks and your historical data to set realistic targets.
How can Enji help improve customer satisfaction?
Enji empowers businesses to improve customer satisfaction by making it easy to monitor, analyze, and act on customer feedback and performance data:
Automated feedback tracking
Enji integrates with customer support platforms and surveys, collecting real-time satisfaction data across touchpoints.
Actionable analytics
The platform aggregates CSAT, NPS, and CES scores into intuitive dashboards, allowing you to spot trends and identify areas for improvement.
Proactive alerts
Enji notifies managers when satisfaction metrics dip below set thresholds, enabling immediate intervention before issues escalate.
Performance insights
Enji's analytics connect customer satisfaction data with operational metrics—such as response times or resolution rates—so you can see exactly how team actions impact customer perceptions.
Continuous improvement:
By surfacing actionable insights, Enji helps teams prioritize changes that drive higher satisfaction, from process tweaks to training initiatives.
By integrating customer satisfaction measurement into daily operations, Enji ensures your teams stay focused on what matters most—delivering outstanding experiences that keep customers coming back.
Key Takeaways
- Customer satisfaction is the degree to which your products, services, or experiences meet or exceed customer expectations.
- It is crucial for driving loyalty, referrals, revenue growth, and long-term business success.
- Key metrics like CSAT, NPS, CES, churn rate, and repeat purchase rate provide actionable insights into satisfaction levels.
- Regularly calculating and benchmarking these scores helps you track progress and identify opportunities for improvement.
- Enji streamlines customer satisfaction monitoring, delivers real-time insights, and empowers teams to take proactive steps, ensuring your business consistently delights its customers.
Last updated in July 2025