Nothing Particularly Special – that’s what one of my clients thought NPS stood for.
A few of you might even think the same, but what NPS actually stands for is Net Promoter Score, and it’s been the buzzword of business for the past three years.
NPS is a management tool that can be used to gauge the loyalty of a business’ customer relationship and is based on asking the customer a simple question: How likely are you to recommend this business’ services to a friend or colleague? The customer then scores their experience on a scale from one to ten.
It’s a great tool and gives your team a really useful indication of how customers feel about the business at that moment in time. Word has spread and, of course, lots of business owners have jumped on the bandwagon – I have had eight surveys in the past ten weeks. Whilst it might feel great to watch the responses roll in, it can also be quite dangerous if business owners are not prepared to deal with these responses.
You see, as a customer, if I mark a business with a low score, I then ask myself “OK… what will they do to put it right?”
If no changes are made and nothing is any different the next time I use them, then my perception of the business falls even lower than it was when I originally marked them and I’ll wonder what was the point of taking the time to send them the feedback (that they’ve asked for!) in the first place.
For example, I drive a 100% electric car and when I bought it British Gas promised to install a charge point at my house. It was a complete nightmare. They took four weeks longer than they said they would and then, finally when there was an energy saving light at the end of the tunnel, they installed the wrong charge point.
It then took eight weeks, after six calls, to get it sorted.
A week or so later, the installation firm sent me an NPS card. I gave them a score of one out of ten. Have I heard from them? Of course I haven’t.
So what has that business, or indeed British Gas, gained from sending me that NPS form? Nothing.
Or so you would think, wouldn’t you?
In fact, due to a government initiative, they actually receive £60 for every NPS card that they send out!
They might have gained £60, but they certainly lost something else – my perception of British Gas, and the installation firm, is now less than it was before I filled out that card.
Used effectively, NPS can be a powerful management tool for you as a business owner, as well as helping your customer feel more engaged with the business. Here’s how: You need to ask your customer not one, but two questions.
- How likely are you to recommend the business to a friend or colleague?
- Please can you tell me why you chose that rating/score?
Those customers who give you a rating of nine to ten (that’s a ‘strongly recommend’, by the way) will tell others all about their experience and why they enjoyed being your customer so much. As a
business owner this information is extremely valuable, and is certainly something to bear in mind when creating marketing strategies or developing processes, as it’s a clear indication of what’s working for you in your business.
If a customer has given you a rating of 6 or less, knowing why that is will show you the weak spots in your business that need fixing.
You can then prioritise your resources more appropriately, as well as going back to your customer to tell them the steps that you’re taking to remedy the issue. This is the moment to surprise and delight your customers with a response – some of them won’t even be expecting it, and it’s your chance to craft a great response and turn them into strong advocates for your business.
So, when you’ve fixed the glitch, or strengthened the system, and your business is all the better for it, why not thank the customers who gave you a less than favourable rating and incentivize them to re-experience your business?
However, that can only happen if you ask them that all important second question. Without it, NPS is nowhere near as powerful as it has the potential to be.
Businesses which successfully create strong advocates typically grow two and a half times faster than those that don’t. What proportion of your customers are strong advocates this month, last month, last year?
If you don’t ask them, you won’t know what to fix, or shout about.
So the moral of the story is:
- If you are going to use NPS, use both questions
- Ensure you have strategies in place to respond to the low scores in order to create advocates of your brand
- Communicate the findings to your team and visibly measure the results within the business
- Communicate the improvements you have made to your customers
- Reward the customers that have encouraged you to improve
