# Customer engagement rate

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## What is customer engagement rate?

Communication and connection with clients via different marketing platforms are known as customer engagement. A single figure representing the engagement of clients and consumers of your service is known as the customer engagement rate. The user’s action and consumption of your services will significantly impact this rate. As a result, each consumer will automatically get a score based on their activity. A good rating will show that your client is content, pleased, and engaged.

### How to measure customer engagement rate

To measure customer engagement, people use metrics such as website visits, time spent on the website, clickstream, etc. There is a better method to accomplish that, but that type of information is unquestionably helpful and would distinguish someone from anyone who isn’t interested in using the service.

There are better ways to gauge customer engagement based on how often they use a product. This is because an engaged customer is the one who can reap benefits from the use of that product. Even a customer who uses a product often is more likely to ditch it if they can’t unlock its potential and don’t get the value for their money.

To efficiently see if the customer benefits from any product or service, follow the steps below:

List the primary advantages of the product/services.

Determine and list the advantages that service providers may track with certain occasions, activities, or outcomes.

Assign weightage to each of those advantages based on a priority order.

It is important to track each advantage separately in the order of its importance. That’s why the advantages provided by the product or service must be specified by the weight or priority given to each occurrence to be recorded—the weight increases with the benefit. The parameters must stay constant during the computation, regardless of whether the range is 1 to 10, 1 to 100, or anything else.

Calculate the Customer Engagement Rate.

Calculate the customer engagement rate with the formula below after setting up the weight criteria to monitor the occurrences of the benefits. The sales and customer success teams can use this score to track customers and develop strategies to keep them as clients and boost engagement.

### Customer engagement rate formula

Use the following formula to calculate the customer engagement rate:

Here, n is the number of times the event providing the benefit happened, and w is the weight attributed to it.

Note that a product in the B2B SaaS industry is likely being utilized by several users with various profiles inside the business. In such a situation, monitoring the Customer Engagement rate by individuals, a set group of users (of multiple profiles), or the whole user business may be beneficial.

### SaaS customer engagement rate calculation example

Let’s use an example to understand the customer engagement rate calculation.

Say a company XYZ provides a SaaS platform to allow their customers to increase their reach on several platforms. The following are the advantages listed when the XYZ product is used:

(The weight is provided as per the priority of the advantage out of 10)

Increase in the number of social media followers = w1 = 3
Increase in the number of likes = w2 = 1
Increase in the number of comments = w3 = 2
Increase in the number of people who reach out = w4 = 2
Increase in the number of tags = w5 = 2

Now, let’s assume that for a single post, a customer G is getting:
Ten followers, 300 likes, 35 comments, five reaches, and three tags.

Then their customer engagement rate, as per the formula, is calculated below.

Customer Engagement Rate = (n1 x w1) + (n2 x w2) + … + (n# x w#)
Here n = interaction caused by the post
= (3 * 10) + (300 * 1) + (2 * 35) + (5* 2) + (3 * 2)
= 30 + 300 + 70 + 10 + 6
= 416

Based on several such calculations, XYZ can determine the average customer engagement rate to set a performance benchmark for the product.

For example, if the benchmark is 500, customer G’s customer engagement rate is below par. XYZ’s sales and customer success teams need to develop strategies to help customer G to make the most of the benefits offered by their product to be more satisfied with it.

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