7 Key Metrics In 2024 – Forbes Advisor

Understanding which metrics are important is key to implementing a solid business plan. This will help you make accurate decisions rather than rely on intuitive instincts, which can be dramatically different from the facts.

Your vital CRM metrics need to monitor marketing, sales and customer service, as mentioned above. Some of the specific numbers to follow are:

Customer Turnover

Being able to review your clientele turnover or customer churn is important to gauge success. While reviewing how many customers are left can be unpleasant, it allows you to pivot your messaging and offering to stem the tide of customers switching away.

This customer churn can be calculated monthly, quarterly and yearly. As the world is moving at a lightning pace, you’ll want to keep track of how many clients you lose and how many you gain.

Net Promoter Score (NPS)

The net promoter score (NPS) measures your customers’ satisfaction with your business’s services and product offering. Normally, this data is gathered via the usual customer research question of how likely you’d be to recommend the company to colleagues and friends.

These questions are rated on a one to ten basis. Your consumer rating scale will determine the NPS.

Customer Effort Score (CES)

This metric determines how much effort your customer had to put in to gain answers and lodge queries. You want all your customers to experience an effortless transaction. The lower the satisfaction, the more effort your client had to make. This score can be improved via multiple methods.

When reviewing your CRM analytics, it’s best to review the CES with your NPS score as it will guarantee a better, more rounded picture.

Rate of Renewal

This metric is vitally important for services reliant on subscription-based companies (think software packages). The rate of renewal metric measures how many clients re-sign up to the service. It is a fairly straightforward measurement, but vital to help you learn if you have long-standing customers or short-term users. This data will pivot your strategy dramatically.

Retention Cost

Retaining clients is one of the most important metrics of CRM. In fact, the Gartner Group estimates that almost 80% of a company’s revenue comes from just 20% of its existing customers. This indicates the importance of nurturing customer relations and how converting new clients isn’t always the best strategy.

Calculating customer retention is vitally important, and to work it out, you need to bear in mind the following:

• Time. You need to determine the time period for your calculation. It can be divided up into monthly, quarterly or yearly.
• Expenses. While retaining clients is normally the solid strategic route, it’s important to calculate what this retention plan costs for the company. Make sure to add in the new tools developed and material as well as timings.
• Number of those retained. It’s always important to review how effective your strategic rollout is. This is determined by measuring how many clients you’ve been able to retain.
• Average cost. The final aspect to stress test, or determine, is the average cost of retaining a client for the company. It’s important to ensure that retaining clients doesn’t exceed the average revenue.

Expansion Revenue

While it is cheaper to retain a client, no company should rest on its laurels. This metric is closely related to renewal rates but refers to how much more capital your existing clients are going to spend with your company.

You’ll need to divide your new income from promoting sales and cross-selling by your revenue during the month to work out this expansion revenue.

First Contact Resolution Rate (FCR)

Any company’s client services department should strive to resolve issues as quickly and efficiently as possible. No customer should be required to phone or message multiple times to find a solution, so make sure that your customer service team is going above and beyond. The ideal success rate is 100%, but mistakes happen. Rating above 90% is good, while below 50% leaves significant room for improvement.