What is a customer health score?
A customer health score is a value that indicates the long-term prospect for a customer to drop off or, conversely, to become a high-value, repeat customer through renewal or Cross-selling or up-selling strategies.
Key performance indicators (KPIs) for customer health scores include the churn rate, which identifies customers who don't return and renewal rates for customers who continue to make purchases.
How to measure a customer health score
Data for customer health is often visualized by using a traffic-light model, in which green signifies a healthy customer account; yellow signifies that the customer account is in stasis and may need prodding; and red signifies that the account needs immediate attention.
Health can also be identified with a Likert-type score, with ranges between 1 and 100. Scores can be descriptive or predictive. Descriptive scores focus more on the current state of customer health, whereas predictive scores use current data triggers to predict a customer's future propensity to drop off or renew.
