Name a common metric used to measure customer satisfaction.

Net Promoter Score (NPS) is a widely recognized metric used to gauge customer satisfaction and loyalty. It is derived from asking customers a single question about the likelihood of recommending a company’s products or services to others. This approach not only captures customer feelings about the brand but also correlates strongly with growth and retention. A high NPS indicates that customers are not only satisfied but are also advocates for the brand, while a low NPS can signal potential issues with customer experience or product quality.

This metric provides actionable insights for organizations to understand customer sentiment and prioritize areas for improvement. In contrast, other metrics like Return on Investment (ROI), Customer Acquisition Cost (CAC), and Revenue Growth Rate, while important for assessing business performance, do not specifically focus on measuring customer satisfaction. Instead, they address financial efficiency, costs related to acquiring new customers, and overall revenue trends, which are valuable in their own contexts but do not directly reflect the feelings or experiences of customers.