How to Calculate CSAT: A Simple Guide to Customer Satisfaction Score

We all know that happy customers are the bedrock of a healthy business. They come back, they spend more, and they tell their friends about you. But how do you know if your customers are actually happy? Guessing isn't a strategy. That's why it's critical to understand how to calculate CSAT directly.

When you have concrete data, you can stop guessing and start making informed decisions that directly impact customer retention, loyalty, and your bottom line.

The Top Customer Satisfaction Metrics

When businesses look to measure customer sentiment, they typically turn to a few key customer satisfaction metrics. You may have heard of the Net Promoter Score (NPS), which measures loyalty, or Customer Effort Score (CES), which measures how easy it is to do business with you.

These are both excellent metrics, but one of the most direct and popular ways to get an immediate pulse on customer happiness is the Customer Satisfaction Score (CSAT). For this post, we'll focus on this foundational metric.

What Is the Customer Satisfaction Score (CSAT)?

The Customer Satisfaction Score (CSAT) is a metric that measures a customer's happiness with a specific product, service, or interaction. When a company sells products or services, you may also measure a customer’s happiness relative to their overall perception of product quality as measured by a Product Quality Score (PQUAL).

These metrics are typically captured using simple customer satisfaction surveys that ask a direct question, such as:

• "How satisfied are you with the quality of the final [product/service]?
• "How satisfied are you with our level of customer service?"

The response is collected on a numbered scale, most commonly 1 to 5, with choices such as:

• Very Unsatisfied
• Unsatisfied
• Neutral
• Satisfied
• Very Satisfied

What Is the Difference Between CSAT (PQUAL) and NPS Measurements?

Measuring customer satisfaction (and product quality) captures how the customer feels now or in the past. Therefore, CSAT and PQUAL are “lagging indicators”. They tell you typically how the customer ‘felt’ about their experience. In contrast, Net Promoter Score is a “leading indicator” that measures the likelihood of how a customer will behave in the future, asking:

• “How likely is that you would recommend {COMPANY} to a friend or colleague (or family member)?

This is why you typically see surveys ask both a satisfaction and NPS question, to capture both past and future indicators. You can read more about Net Promoter Score (NPS) here.

How to Calculate CSAT Using the Customer Satisfaction Formula

Now for the easy part. The CSAT calculation (and PQUAL calculation) is a straightforward formula that turns those survey responses into a simple percentage.

To find your score, you only need to focus on your satisfied customers—those who gave you a rating of 4 (Satisfied) or 5 (Very Satisfied).

Here is the formula for how to calculate CSAT:

CSAT Score = (Number of '4' and '5' responses) / (Total number of responses) x 100

Let's use a simple example:

Imagine you sent a CSAT survey and received 200 total responses as follows.

• 70 people responded with a "5" (Very Satisfied)
• 90 people responded with a "4" (Satisfied)
• 20 people responded with a "3" (Neutral)
• 15 people responded with a "2" (Unsatisfied)
• 5 people responded with a "1" (Very Unsatisfied)

First, add up your satisfied customers:

70 (5s) + 90 (4s) = 160 satisfied customers

Now, plug that into the formula:

(160 satisfied customers / 200 total responses) x 100 = 80%

Your CSAT score is 80%.

Putting Your CSAT Score to Work

A CSAT score of 80% is generally considered good. In academics, a score of 80 is usually a B-, which is good. But the number itself is just the starting point. The real value comes from acting on the feedback. Listening to customers, and making continuous improvements will help you move that B- to A. Ignoring customer feedback may send that B- to a C-.

By understanding how to calculate CSAT and track your CSAT score, you can benchmark your performance over time and see how new initiatives are impacting customer happiness. Comparing your CSAT to NPS can illuminate gaps where customers may be happy in the past, but less likely to come back in the future. More importantly, by using a platform like LoyaltyLoop, you can instantly see all your feedback on all key customer experience (CX) metrics, including the feedback from customers who aren't satisfied (those 1s, 2s, and 3s), giving you a chance to follow up, resolve their issues, and turn a potentially negative experience into a positive one.