Part 3: Grow Your Business Incrementally Using Net Promoter Score® - Omoto

Part 3: Grow Your Business Incrementally Using Net Promoter Score®

Net Promoter Score® is a customer loyalty metric developed by Fred Reichheld, Bain & Company, and Satmetrix. It was introduced by Reichheld in his 2003 Harvard Business Review article ‘One Number You Need to Grow’.

This post is a collection of parameters that one must take care of when implementing Net Promoter System in their business. I have divided this into a 3 part series and this is the final blog in the series.

You can read the part 1 of this series here where I talk about:

  • What is Net Promoter Score
  • Why is Net Promoter Score® important
  • Common myths surrounding Net Promoter Score ®

In part 2 of this series, I have covered:

  • The need to segment customers when implementing NPS
  • The manner of segmenting customers
  • The method of putting customers into buckets using NPS
  • The reason to loop in the senior management and ways to do so

So, now that we understand NPS, have segmented our customers, and have looped in the senior management, it’s time for some real action. It’s time to start listening to the customers!

In part 3, we shall cover:

  • Capturing NPS® in the correct way
  • Collating and analyzing customer feedback
  • Closing the loop on customer feedback
  • NPS® best practices and tips

The next logical step in understanding your customers is listening to the voice of the customer.

Capturing NPS® in the correct way

First, you need to ensure that you’re bringing in the purity to your NPS score. If your NPS score is not correct, then the entire initiative is going to fail.

Let’s have a look at some common mistakes that brands make when designing an NPS survey. A typical example of doing it wrong is in the questionnaire below. For instance, in the form given below, the NPS question is hidden beneath several other questions.

If you notice, question number 15 is the NPS question, which says the following:

Based on your experience with this flight, how likely would you be to recommend Delta to a friend or colleague?

  • Extremely likely
  • Very likely
  • Somewhat likely
  • Not very likely
  • Not at all likely

The first mistake here is that this question is hidden under a myriad of questions. Further, the options are equally vague. There seems to little difference between each of them.

Let’s now look at a few example of doing it right!

ACME Fireworks NPS

The below example demonstrates that the key is to focus on the reason for the ratings, not just the ratings.

Uber NPS

GrooveHQ NPS

Would you like to design an NPS survey that makes it easy for your customers to give you a feedback?

Book A Free Discovery Session

Collating and Analysing feedback

How do you collate and analyze feedback effectively? Use the following pointers!

  1. Design the email
    Firstly, you need to define what your email body is going to look like. Do look at the template given in the link below; it will help you design your indicative survey.
  2. Define the reasons based on the touchpoints
    Let’s take an example of a retail setup. The journey that your customer is taking starts right from the point he enters your store, where he looks at your visual merchandise. It involves all the points of interaction that the customer has with your brand.  For instance, it continues as he looks out for the clothes, has a word with the store staff, tries the clothes in the changing room, and finally bills his purchases and walks out of the store. So, that’s the overall journey that the customer has taken. You can have the categories or the reasons for the score based on these touchpoints that the customers experiences in doing business with you.
  3. Define categories and filters
    These could be based on the demographic details, geographic details, or the behavioral data showcased by a customer in using the product or in returning to do business with you. It could be based on loyalty or on psychographic information. We have talked about these categorisations of customers in detail in the previous lesson.

Closing the loop on Customer Feedback

Imagine this situation. Imagine going to a restaurant and having a great time with your family and friends. Now, at the end of the experience when you’ve had a jolly good time, the manager comes over asking for a feedback and checking whether you enjoyed the experience. As soon as you give a feedback, the manager just turns and leaves with a blank poker face.

How would you feel? Won’t you feel that the manager was doing this out of a protocol and did not really care for the experience that you had?

At times, we fall prey to not closing the loop on the feedback and we can only imagine how our customers would feel about it.

Closing the loop is an important and critical part of an entire NPS system implementation in your business. Let’s take a look at four reasons why should you close the loop.

  1. To let your customers know that you really care
    Your customers should know that you’re genuinely interested in asking for the feedback. They must feel that their feedback is precious to you and that you’re going to take action on the feedback. You must convey to them that this is not just a mechanical exercise that you’re doing out of a protocol.
  2. To resolve issues before they become big
    If you listen to the customer feedback and taking corrective action on it, it means that you solve problems before they get escalated. This means that you have resolved the grievance before a disgruntled customer escalates it to someone higher up in your business and multiple stakeholders get involved.
  3. To let the team know you’re serious about taking action
    If you’re closing the loop, your team believes that you’re serious about the entire initiative. It’s not an initiative you are pursuing because the competition is doing so or because everyone is talking about being customer-centric. It shows the team that you’re really serious about customer feedback. This ensures that the team is serious about this initiative too.
  4. To continuously derive insights and evolve your business
    When you consistently take feedback, you derive actionable insights from it. This, in turn, ensures that you can improve your business process, product, and strategy, essentially helping you evolve as a business itself.

How to close the loop on customer feedback?

The below diagram gives a wonderful representation of the four steps that are needed to close the loop on customer feedback.
Closed Loop NPS

  1. Listen
    Firstly, you need to identify the touch points at which you’re capturing feedback from your customers. This is because you must ensure that you are listening to your customers’ feedback on the right steps.

    • Fix
      Once you’ve captured the feedback, you need to fix the customer complaints and provide a tactical solution. There are some issues that can be addressed promptly and do not require a large team or massive planning. So, you must focus on fixing these issues quickly, providing you an opportunity to score some quick wins.
  2. Understand
    Secondly, you must get to the root cause of the customer dissatisfaction and understand the drivers of your customers’ satisfaction or dissatisfaction. This would entail analyzing the data. The analysis can be done by slicing and dicing the data or by deep-diving to some qualitative feedback that you have received. But, this essentially means putting your head around what your customers are saying about doing business with you. This must encompass all the feedback: the good, the bad and the ugly!
  3. Design
    Thirdly, you must build an action plan for improving CX. This must include developing project plans and budget. That’s where looping in the stakeholders and inputs from senior management is critical. This allows you to get a buy-in from the senior management for these projects. Further, it helps to fix customer issues based on the understanding of customer experience being delivered.
  4. Implement
    Once you have defined the projects you need to drive to improve customer experience, showcased the ROI, and received approvals from the senior management the final step is to implement the projects. To do so, you must identify the stakeholders and drive projects based on defined timelines.

That’s a loop; it’s a continuous process. You’ve to continuously listen to the voice of the customer and evolve the experience you are delivering to your customers.

While the above process discusses how you can close the loop on your detractors, let’s look at how can you do the same for promoters.

Let see this through an example.

Firstly, you must define the design the survey email, which must have the NPS question with the rating scale.

Step two is to capture the reason for the score. For promoters, the messaging could be: “Thanks a lot for amazing feedback.” However, for detractors, it could be: “We are sorry that we couldn’t meet your expectations. Please select the options below that best describes a reason for your score.”

The customer has the option to select the reason for the score here and click on ‘next,’ which takes him to the next stage – the verbatim comment. Here, you can ask the customer to leave a verbatim comment. That takes us to the next step – closing the loop.

Remember, promoters are those customers that have given you the rating of nine or ten. These are customers that are really delighted about doing business with you and would recommend you to their friends and family. In today’s age, the recommendation is driven a lot by social media, isn’t it? An example of closing the loop on promoters is to ask them to recommend you on social media or third-party review website. You can also incentivize this process. I don’t recommend incentivizing the survey request itself because that would mean the customer is giving a feedback just for that incentive or a freebie. However, you can certainly encourage them to leave a response and subsequently offer a discount voucher or a coupon that they can offer their friends and family.

Get XLS Template to design NPS Campaign.

NPS Best Practices and Tips

Finally, here are some best practices and tips to ensure that your NPS initiative is a massive success!

Remember that NPS is not a market research tool
NPS is a system that enables you to listen to the voice of the customer and use it to derive insights, making incremental business improvements. It is not something that you can use as a research exercise. This initiative should not be about adding just one NPS question in the plethora of questions that you’re already asking your customers. Use it in its truest flavor, bring in purity to that number, so that it can be a correlation to your business growth.

Don’t forget to close the loop
We’ve talked about this aspect at length. You must ensure that you’re closing your loop on your detractors, passives, and promoters. If you’re not doing so, your customer would certainly feel that this is just an eyewash exercise that you are not serious about it. So, you need to show your customer and your team the seriousness of this initiative and how it can help your business grow massively.

Focus on the ‘why’ and not just the score
The ‘why’ of the NPS question is a gold mine of information. You need to make sure that you’re meticulously reading every comment that your customers are leaving for you in the NPS question. For instance, there could be times that a customer has given a promoter rating but still has given an advice on an area to improve. Don’t you think you should put special emphasis on taking action on this feedback?

Share customer feedback within organization.
Customers tend to leave both negative and positive feedback. You must make the employees in your organization aware of this feedback. Negative feedback allows you to understand what the quick wins and big bets are. On the other hand, the positive feedback allows you to plan how to tune your marketing message, understand what your customers like about doing business with you, and what kind of customers like doing business with you. Subsequently, you can reach out to and get more of such customers.

Get your front line involved
Your frontline employees are the ones interacting with the customer day in and day out. These are the employees that understand your customers the best. You must get them involved in your initiative. However, it is also imperative that the top management is involved in this project.

Automate the feedback collection process
Remember that you don’t have to get involved with executing campaigns. This should be an automated process. Your focus should be on taking action, making sure that you’re closing the loop, ensuring that you’re using the insights to actually make business improvements.

How did you like this 3-part blog series on increasing your revenue using the Net Promoter Score? Do let me know your views!

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Grow Business Incrementally With NPS - 2

Part 2: Grow Your Business Incrementally Using Net Promoter Score®