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Why Net Promoter Scoring?
1. What is the NPS?
2. Who uses it?
3. Why should we use it?
4. Fundamentals
5. Loyalty > satisfaction
6. Good and bad profits
7. NPS Principles
8. How it’s really done
What is the Net Promoter Score?
• Measure of customer loyalty, not satisfaction
Net profits and net promoters
Just as you need to know the details of revenues and costs to analyze that most famous of bottom lines –net profit – so too do you need detailed data on promoters, passives, and detractors in order to understand your Net Promoter Score.
- Frederick Reichheld, The Ultimate Question 2.0
The ultimate question asks:
Have we treated you right in a manner worthy of your loyalty?
- Frederick Reichheld, The Ultimate Question 2.0
Why does it impact bottom line?
Promoters drive good profits
A loyal base is a bulwark against:
- market disruptions
- economic downturns
How does it work?
- The fundamentals -
The Fundamentals
1. Measure regularly and often
Systematically categorize promoters,
passives, and detractors
Transparently communicate results
Continuous measurement
The Fundamentals
2. Use two closed-loop learning processes
The Fundamentals
3. Top-down, mission critical initiative to increase promoters, decrease detractors
Summary: process, not a product
You follow the fundamentals:
1. Measure regularly and report
2. Close the loop
3. Mission critical, top-down initiative
What is the goal of measuring
1. Discover loyalty and the reasons for it
2. Create accountability across organization
3. To tell difference between good profits and
bad
1. Measure Loyalty
A metric that measures loyalty is better than one
that measures satisfaction
2. What gets measured creates accountability
3. Good profits, bad profits
Bad profits are earned at the expense of customers, good profits are earned with customers’ enthusiastic cooperation.
- Frederick Reichheld, The Ultimate Question
Detractors drive bad profits
They cut back on purchases
Switch to competitors
Spread negative message
Promoters drive good profits
They happily return
They spread positive message
Encourage others to do business with you
Join your marketing department – for free!
So, how do we do this thing?
Use Net Promoter Principles to turn
detractors into promoters and increase
good profits
Net Promoter Principles
1. Ask the ultimate question and little else
How likely is it that you would recommend …
What is the most important improvement we
could make that would make you more likely to
recommend us?
Net Promoter Principles
2. Choose a scale that works, stick with it
Net Promoter Principles
3. Aim for a high response rate from the
right customers -- the ones you care most
about
65%
Net Promoter Principles(don’t forget about the non-responders)
Net Promoter Principles
4. Use transaction-based surveys
Most information for least cost
Less prone to bias than relationship surveys
Use to improve the performance of front line
employees and supervisors
Net Promoter Principles
5. Report NPS data as often as possible.
Report quickly and learn
Net Promoter Principles
6. Go granular to learn faster and improve
accountability
• Segment customers
• Satisfaction with the transaction VS loyalty to or
happiness with company
Net Promoter Principles
7. Audit
• Prepare for PWC
• Ensure accuracy and freedom from bias.
• Bias happens. We can only mitigate it.
• Be consistent
What is next?
1. Draw up project plan
2. Stakeholder interviews (requirements)
3. Connect team brainstorm for
segmentation
4. Identify management team
5. Identify who’s accountable tactically
6. Marketing plan?
7. Other?
For more research-based insights
about our users, check out the UX
insights portal:
http://insights.redacted.com
Thoughts? Questions?
