The Ultimate Customer Experience Glossary
In the world of customer experience, there’s a lot of terminology, lingo, and acronyms flying around. CSAT, NPS, COO, CXM, CRM…it can be hard to keep up. That’s why we’ve put together the ultimate customer experience glossary, so you can find all the terms you need to know in one place.
Psst: Looking for a particular term? Press Control+F ( or Command+F if you're on a Mac) and type in the word you’re looking for to fast track.
Customer Experience Terms and Definitions
Chief Customer Officer (CCO)
A Chief Customer Officer (CCO) wears many hats, but is ultimately responsible for representing the customer across the entire organization. “How can we maximize customer satisfaction at every touch point? “How can we build a community of raving brand advocates?” “How can we amplify our CX investments?” are questions that CCO’s keep coming back to. You can think of a CCO as a puppeteer, orchestrating frontline teams, technology and touchpoints so that the customer experience is as awesome as it possibly can be.
Closed Feedback Loop
A closed feedback loop is one where an organization not only receives real-time feedback from their customers, but responds accrodingly, then feeds learnings from that feedback back into the business to adjust processes. The best way to do this is by delivering it straight to frontline teams and managers, where it can be learned from and acted upon in the moment.
The philosophy of any good business will put the customer and their needs as the focal point of all business plans and decisions. That’s what we mean when we use the term ‘customer-centricity’. This increases customer retention, satisfaction and loyalty to your brand.
Customer churn is the number of customers that leave a business over a given period. It's the opposite of customer retention. It can be calculated using the formula: (Lost Customers ÷ Total Customers at the Start of Time Period) x 100. For example, if your business had 500 customers at the beginning of the month and lost 20 customers by the end, you would divide 20 by 500. The answer is 0.04.
Customer Experience (CX)
When we talk about customer experience we're talking about the way a customer personally feels about your company, its products, services and, well... everything: all of the tiny details and micro-moments that add up to create an opinion. A customer’s experience starts at the first impression of your brand, and encompasses all ongoing interactions thereafter. Not to be confused with customer service, which describes a single touchpoint, customer experience looks at the customer's impression holistically.
The customer journey is the roadmap of all experiences and interactions a customer has with your brand and/or products and services. This roadmap can easily be visualized, to show the customer's progress across touchpoints and pain points.
Customer Experience Management (CXM)
Customer experience (CX) management is a strategy that tracks, analyzes, controls, and (hopefully) improves interactions with your customers at every touch point. In other words, it's labor that goes on behind the scenes to make sure that customers feel fabulous when they're engaging your brand (and talking about you to their friends and family).
Customer Relationship Management (CRM)
Customer Relationship Management (CRM) is a company's view of a customer, primarily through the lens of sales. It tracks engagement and purchase histories of individual customers with an eye toward future sales to individuals.
Customer retention refers to the rate at which a company is able to keep customers coming back for more. It considers strategies to turn customers into repeat customers, and decrease the number of people who churn (drop off or look for alternatives). High customer retention rates signify a business is providing an experience that resonates with customers, and means they are able to maintain their position as a preference over their competitors.
Customer Satisfaction (CSAT)
CSAT is short for "Customer Satisfaction" - This usually asks the direct question, "How satisfied are you with your experience? And is answered on a 5-point scale ranging from “very dissatisfied” to “very satisfied”. It can be combined within a broader survey with other questions or it can be asked as a standalone question.
Customer service is the assistance and support provided by frontline employees to their customers. Shipping questions? Praise for a product? Complaints about a consultant? The follow-up actions to customer queries and actions all fall under the umbrella of customer service.
Within the NPS framework, detractors respond with a score of six or below. They are the opposite of promoters and are likely to churn and/or post negative reviews and word-of-mouth.
Frontline Employee Experience
The Frontline Employee experience encapsulates how an employee behaves, thinks and feels towards the organization they work for. The frontline experience catalyzes a series of ‘knock on effects’ that ultimately leads to awesome customer experiences, flourishing loyalty and exponential growth. Learn how here.
Brands with the highest level of feedback mastery not only collect customer feedback in real time and connect it directly to their frontline teams, but have mechanisms in place to act on the feedback, start meaningful coaching conversations and learn from it rapidly to guide wider business strategy. In the State of Frontline Work Study, just 16.3% of surveyed businesses qualified with feedback mastery. Find out where you sit here.
Frontline Coaching Mastery
Brands with the highest level of frontline coaching mastery have personalized coaching for each worker. In the State of Frontline Work Study, just 24.4% of companies reached this milestone. See where you sit here.
Frontline empowerment is about giving frontline staff the knowledge, confidence, tools and autonomy to provide awesome CX.
Frontline recognition refers to how well an organization recognizes, appreciates and rewards their frontline teams for delivering awesome customer experiences. The better an organization is at frontline recognition, the more motivated and empowered their team will be.
Net Promoter Score (NPS)
NPS is an essential customer experience metric used to determine the strength of a customer's loyalty to your business. The principle is simple. Your customers receive a survey, and the results are scored on a scale ranging from -100 on the low end to +100 on the high end. The goal of measuring this metric is ultimately to predict business stability and improve customer relationships.
Omnichannel = omnipresent. A business’s presence needs to be widespread and span across email, phone, a website and much more. The larger your omnichannel presence, the easier it becomes for customers to interact with your business in a medium and time that suits them.
Within the NPS framework, passive customers score with a seven or eight. Their needs have been met, but your business hasn’t left an impression on these customers, so they can easily be persuaded to switch to a competitor.
Patient Experience (PX)
As patients of specialist healthcare providers gain more purchasing power, the terms “patient” and “customer” are no longer mutually exclusive. The patient experience runs parallel to the customer experience, and refers to the tiny details and micro-moments that add up to create an opinion. Like a customer, a patient's experience starts at the first impression of your brand, and encompasses all ongoing interactions thereafter.
A personalized customer experience is one that meets the individual needs of a customer. Personalization is about the little details that make a customer feel special, instead of just another number.
Within the NPS framework, these customers respond with a nine or a ten. At this point, they aren’t customers but brand advocates. Not only will they become repeat customers but can drum up more business via referrals or positive word-of-mouth.
When it comes to feedback, the fresher, the better. Real-time feedback is collected from the customer as soon as a service is delivered, and funneled immediately to customer-facing teams.
Rework occurs when frontline teams fail to meet the customer’s expectations. Employees have to back track and redo elements of the service to satisfy the customer’s needs. For example, a cleaner has to return to the premises to do a more thorough job of the bathrooms. Rework is costly, timely and can be avoided if frontline teams are
Put simply, service standards are a set of tangible guidelines that help to define a) what a customer can expect from a service, and b) how the experience should be delivered by the frontline.
A touchpoint is any interaction between a customer and a business across all channels, whether by social media or phone, online or in-person.
The 7 Habits of Empowered Frontline Teams
In our experience, the best and brightest service brands all operate under a set of daily habits that drive their success. Check them out here.
You’re officially clued up on the must-know CX terms. Nice work! Be sure to check back for additions as new CX buzzwords, lingo and phrases emerge.