Must-Know Customer Health Metrics

Highlights: The Most Important Customer Health Metrics

  • 1. Customer Churn Rate
  • 2. Net Promoter Score (NPS)
  • 3. Customer Lifetime Value (CLV)
  • 4. Customer Retention Rate
  • 5. Customer Acquisition Cost (CAC)
  • 6. Average Revenue per User (ARPU)
  • 7. Monthly Recurring Revenue (MRR)
  • 8. Customer Satisfaction Score (CSAT)
  • 9. Customer Effort Score (CES)
  • 10. First Contact Resolution (FCR)
  • 11. Repeat Purchase Rate (RPR)
  • 12. Time-to-resolution

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Understanding and prioritizing customer health is essential for long-term business success. CHM provides valuable insights into satisfaction, loyalty, and experience. Measuring, analyzing, and acting upon these metrics has a significant impact on the bottom line and future growth potential.

This blog post explores CHM, including parameters, strategies, and best practices for measuring and managing customer relationships. Leveraging these metrics fosters loyalty and sustainable growth. Start an enlightening journey to elevate a customer-centric approach and unlock new levels of success for your organization.

Customer Health Metrics You Should Know

1. Customer Churn Rate

This metric measures the percentage of customers who cancel or stop using your product or service over a specific period. High churn rate indicates customer dissatisfaction or issues with the product, while a low churn rate suggests customers are happy and loyal.

2. Net Promoter Score (NPS)

NPS gauges customer loyalty and satisfaction by asking customers, “How likely are you to recommend us to a friend or colleague?” on a scale of 0-10. Scores are typically categorized into promoters (9-10), passives (7-8), and detractors (0-6).

3. Customer Lifetime Value (CLV)

CLV estimates the total revenue a company can generate from a customer during the entire relationship. It helps businesses understand customer segments’ profitability and focus on retaining high-value clients.

4. Customer Retention Rate

This metric calculates the percentage of customers retained over a specific period, excluding new customers. A high retention rate signifies a strong customer base and a company’s success in meeting customer needs.

5. Customer Acquisition Cost (CAC)

CAC evaluates the cost of acquiring a new customer, including marketing and sales efforts. A lower CAC means a more efficient acquisition process and better profitability.

6. Average Revenue per User (ARPU)

ARPU measures the average revenue generated from each user or customer over a particular period. It helps track customer spending patterns and can guide pricing and marketing strategies.

7. Monthly Recurring Revenue (MRR)

MRR tracks the predictable revenue earned from customers on a monthly basis in subscription-based business models. This metric is useful for monitoring cash flow and forecasting future revenue.

8. Customer Satisfaction Score (CSAT)

CSAT reflects how satisfied customers are with a specific product, service, or interaction. Customers rate their satisfaction on a scale, such as 1-5, and the average score represents overall customer satisfaction.

9. Customer Effort Score (CES)

CES assesses the ease of doing business with a company by asking customers, “How much effort did you personally have to put forth to resolve an issue or complete a task?” A lower CES means customers find the company easy to interact with, improving customer satisfaction, and loyalty.

10. First Contact Resolution (FCR)

FCR evaluates the percentage of customer issues resolved on the first contact, whether via phone, email, or chat. High FCR rates imply efficient customer support processes and higher satisfaction.

11. Repeat Purchase Rate (RPR)

RPR measures the likelihood of customers making repeat purchases, indicating their satisfaction and loyalty. A high RPR reveals the ability to retain customers over time, which impacts overall business sustainability.

12. Time-to-resolution

This metric calculates the average time taken to resolve customer issues or complaints fully. Shorter time-to-resolution times indicate efficient customer support and satisfaction with the resolution process.

Customer Health Metrics Explained

Customer Health Metrics improve satisfaction, loyalty, and business performance. Metrics like Churn Rate, NPS, CLV, and Retention Rate identify dissatisfaction and retain high-value customers. Metrics like CAC, ARPU, MRR, and CSAT guide pricing and marketing strategies while monitoring cash flow. Metrics like CES, FCR, RPR, and Time-to-resolution provide insights into customer support processes, satisfaction, and loyalty. Together, they guide decision-making for long-term success and sustainability.


Customer Health Metrics are vital for business success. Tracking them identifies satisfaction levels, weaknesses, and areas for improvement. Focusing on these metrics enhances customer experience, reduces churn, and establishes a foundation for long-term success. Adapting to changing demands and data-driven insights allows agility in addressing emerging needs. Invest in tracking customer health metrics for continued business growth and success.



What are Customer Health Metrics?

Customer Health Metrics are measurable indicators that help businesses track and assess the overall satisfaction, engagement, and success of their customers using the products or services provided. These metrics enable businesses to determine the customer's likelihood to stay loyal, make repeat purchases, and refer the company to others.

Why are Customer Health Metrics important for businesses?

Customer Health Metrics are crucial for businesses because they help them monitor customer satisfaction, identify areas for improvement, and predict customer retention or churn rates. By focusing on customer health, businesses can proactively address issues, increase customer engagement and loyalty, and ultimately, influence long-term growth and revenue.

What are some commonly used Customer Health Metrics?

Some typically used Customer Health Metrics include a. Net Promoter Score (NPS) gauges customer's willingness to recommend a product or service b. Customer Satisfaction Score (CSAT) measures overall customer satisfaction with an experience or interaction c. Customer Effort Score (CES) assesses the ease of use with a product or service d. Churn Rate tracks the percentage of customers who discontinue a service within a specific period e. Customer Lifetime Value (CLV) calculates the total revenue a customer is predicted to generate in their lifetime.

How can businesses improve their Customer Health Metrics?

Businesses can improve their Customer Health Metrics by continuously monitoring them and identifying areas in which customer support, product quality, or overall experience require enhancement. Some strategies may include analyzing customer feedback, conducting surveys, streamlining processes, personalizing customer interactions, addressing issues quickly and effectively, and maintaining clear and open communication with customers.

How often should businesses track Customer Health Metrics?

Businesses should track Customer Health Metrics regularly, ideally monthly, quarterly, or annually, depending on the specific metric and company's needs. Monitoring these metrics consistently allows companies to stay informed about their customers' satisfaction levels and enables them to identify trends, emerging issues or opportunities for improvement, ensuring the ongoing success and well-being of the customer base.

How we write our statistic reports:

We have not conducted any studies ourselves. Our article provides a summary of all the statistics and studies available at the time of writing. We are solely presenting a summary, not expressing our own opinion. We have collected all statistics within our internal database. In some cases, we use Artificial Intelligence for formulating the statistics. The articles are updated regularly.

See our Editorial Process.

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