By: Mark Heisten, Senior Leader, Integrated Payments, Go-to-Market at Vantiv Integrated Payments
When it comes to measuring and valuing customer loyalty, it can be daunting to know where to start. What should you measure? What should you ask? How often should you survey? What if customers raise issues you can’t address? Can you whether a customer is going to leave for a competitor?
Over the past 20 years, Net Promoter Score (NPS) has become the de facto customer satisfaction method among Fortune 1000 companies. With the availability of online survey solutions such as Qualtrics and Survey Monkey, all businesses large or small have the tools necessary to execute their own NPS programs easily and inexpensively.
The One Question You Have to Ask
NPS is a simple survey tool that can be used to gauge customer loyalty. It consists of a single question: “How likely are you to recommend our company/product/service to a friend or colleague?” That’s it. Customers click on a score between 0 and 10.
The NPS survey helps you identify:
- Promoters (9-10) – Generally less price-sensitive and more likely to spend on value-added products and services. When asked, they will advocate for your company among their peers.
- Passives (7-8) – Individuals who appreciate the value of your product or service, but who may switch quickly when something doesn’t perform as expected or if they discover a better deal.
- Detractors (0-6) – These are folks who actively campaign against your business. They are more sensitive to price, less likely to spend more with your business and may be costly to retain. They typically share their negative opinion of your business with anyone who will listen.
The Metric that Matters Most
The NPS score is an overall measure derived by taking the Promoters (%) minus Detractors (%), but that isn’t where the real value is for businesses. The individual customer scores are more important to customer service. You learn how each customer feels about their relationship with you and can use the rating to deliver individualized response, immediately. For example, Detractors are at-risk and need prompt attention.
Five Tips for Getting the Most from Your Survey:
- Follow Up Quickly – Nothing is more precious than honest feedback from a customer, so don’t let days pass before you follow up with them. Establish a process for quick response. Have the service team call or visit all respondents within a few days of their reply.
- Dig into the Details – The score is an aggregate of the perceived value the customer receives from you – products, services and intangibles. To learn more about the customer’s affinity for you, have the service reps as additional questions such as “what is the reason for the score?” or “Is there anything we can do to improve your rating?”
- Encourage Promoters to Share – With the prevalence of social media and online review sites, it’s easy for customers to share their positive experiences with the world. Tell them thanks for their review, and ask if they’d be willing to share the recommendation on your social pages or user groups.
- Internalize the Survey – Use the results of the survey and the follow up engagement with customers to guide product development or increase customer and revenue retention. Use the scores as a component of quarterly business reviews or monthly all-hands meetings to focus discussion around areas for improvement.
- Survey Often, but Not Too Often – The best practice approach is to survey every quarter, but not hit individual respondents more than twice per year. If someone gives you feedback, give them at least six months before you ask again.
Conducting an NPS survey is easy and can positively influence your customer retention efforts. First, secure an account with an online survey company. Many include NPS modules so the system is preconfigured for you. Next, prepare your customer data for the survey. Make sure it is clean – accurate names, email addresses and phone numbers will ensure the results are actionable by your staff. Finally, train the services and sales teams on how to handle the responses as they come in. Let them know that follow-up is a priority and encourage them to share outcomes with their teams.