Net Promoter Score

Revenue growth and profitability – are the two metrics the C-Suite cares about the most. They tell you exactly how you did this month or quarter. But do strong sales predict next quarter’s results? Hardly.  

What if the C-Suite had a crystal ball that could not only predict their growth and profitability, but give  glimpses into the minds of their customers in time to save accounts that might otherwise go under?

We haven’t really had that capability, until now.

Traditionally, Net Promoter Score has been a “lagging indicator.” NPS surveys were typically sent out once a year, or once a quarter at most. There would be a big push to get the survey out, another push to respond, and then a mad dash of trying to piece together what happened during that time to result in the scores received.

But modern NPS programs are different. They can be that crystal ball.

Customer Experience Predicts Growth & Profit

More studies and reports are coming out by the day proving that Customer Experience is a key predictor of growth and revenue – for every type of company, business, product and service. It’s not just a “SaaS thing.” Brick-and-mortar businesses are optimizing for it too, and seeing results.

One of these reports, The Economist Intelligence Unit’s, The Value of Experience: How the C-suite values customer experience in the digital age, found that companies that prioritize investment in customer experience (CX) have better revenue growth (59% vs. 40%) and higher profits (64% vs. 47%) than companies that don’t prioritize customer experience.

McKinsey & Co. found that  “Optimizing the Customer Experience typically achieve[s] revenue growth of 5-10% … in just two to three years.”

And, there’s no better way to optimize for customer experience than by using the NPS metric.

NPS = Customer Experience

There are so many ways to ask about customer experience. You can send lengthy surveys and open-ended questions; you can ask customers in person or over the phone. But there is no question – or list of questions – that reveals the unvarnished truth like the NPS question:

How likely are you, on a scale of 1-10, to recommend this product?

Customers don’t have to worry about hurting your feelings or protecting the job of the “very nice customer service rep” who didn’t help them at all. They just have to choose a number. And, by framing the question as whether they would recommend the product, you tap into a very honest desire to help other people (help them by sharing great products, or help them by warning them away from bad ones).

With one question, NPS gets to the core of whether customer experience efforts are working, or not. This is what makes it the ideal tool to help teams optimize for customer experience. Budge this one, simple number, and you’ve got real progress.

In Fred Reichheld’s The Ultimate Question 2.0, he includes a revealing, real-world example of NPS in action:

Phillips electronics tracked NPS for a sample of accounts over time and found that where NPS increased, revenue grew by 69%. Where it remained steady, revenue grew only by six percent. And where NPS declined, revenues actually decreased by 24%.

Modern NPS = Crystal Ball

What is the difference between NPS and a modern NPS program? Part of the difference is in how the surveys and tracking are managed. A modern NPS program has an easily navigable dashboard that shows you your current scores and compares them to previous ones, lets you see trends clearly, displays qualitative feedback with the quantitative score, and records all of these results in one, central location.

But convenience isn’t the most important difference between the old ways of conducting NPS surveys and cutting edge NPS.

The most important difference is the ability to get NPS results in real-time.

This capability is what gives modern NPS programs the ability to act as leading indicators of customer experience, and by extension, growth and profit.

By polling different customers every day, your customers don’t get over-surveyed (so their response rates improve), and you can see the results of your customer experience efforts immediately, and pivot accordingly.

No more wasting time on customer experience strategies that don’t work. No more wasting resources on measures that don’t actually delight your customer base. If something works, you’ll know it. And, if something doesn’t work, you’ll know that too.

But the crystal ball of modern NPS can do one more thing: Let you catch a glimpse into the minds and hearts of your customers. Along with the basic NPS question, the survey offers a qualitative response screen that lets survey respondents tell you why they scored the way they did. Then, it lets you read those responses, tag them by theme (like “Feature Request“), and send them on to the appropriate department, like “Product Team” or “Marketing.”

The customer receives an appropriate response, improving their experience as a result of taking the customer experience survey.

Not even crystal balls can do that.

A modern NPS program is an incredibly powerful tool that lets you track customer experience in real-time and easily identify actionable insights.

Fred Reichheld invented the Net Promoter Score (NPS) survey 14 years ago to better gauge customer desires and loyalty, and the practice quickly caught on. But when Fred himself announces that he’s sick of customer feedback surveys, you know we have a problem.

There’s no question there is a tsunami of surveys that’s just overwhelming. I think of it as a little bit of a pollution effect that we have to find a way to overcome. – Fred Reichheld

Customer surveys are everywhere. After you hang up from a customer support call, you are almost guaranteed to receive a request to complete one. There are probably at least a handful in your inbox right now.

Surveys are critical to any voice of customer (VOC) program, but they require thoughtfulness, and intentionality.  Don’t just send another email with the subject line, Your feedback is important to us, with content like this:

Please take 3-4 minutes to complete a short survey about your phone call to us on Jun 15 2016 10:23AM. Your feedback will be used to make future improvements to the customer experience. To take the survey, please click on the link below.

Or even worse, a survey email we received that actually ended with this:

Nothing makes a customer feel more valuable than a request to write a letter (what is this the 80s?), or a caveat that their feedback will not receive a response. There are much better ways to solicit customer feedback  — ways that avoid the “pollution effect” and get more customers engaged. Below are tips for getting a higher level of response when reaching out to your valued customers. 

The Key is to Put Yourself in Your Customer’s Shoes

A solid place to start is to ask if your survey process is adding or detracting from your customer’s experience of your brand. You may be surveying customers in order to gather feedback that you can use to make them happier, but is your survey strategy part of the problem? To answer that, think through these five aspects:

1) Resist the dreaded “3-4 minute survey”
Unless absolutely necessary, only ask one question. The NPS question:

How likely are you to recommend this product (or service) to a friend or colleague?

Why? NPS let’s you metricize customer loyalty, and the open-ended feedback question allows customers to get specific about what’s important to them. Instead of surprising your customers with more than they bargained for, consider NPS as a method for receiving actionable feedback in a way that is low impact on customers.

In stark contrast, the “3-4 minute survey” referenced above was actually comprised of 30(!) questions mainly in the following format: “How satisfied are you with _______________ on a scale from 1 to 10?”

 How tedious is that? And by extension, how accurate? Nobody is going to fill this out unless maybe they want to share about a negative experience or have plenty of time on their hands. That means that the “randomly selected” cohort is not going to be that random.

Excessive questions contribute heavily to survey fatigue. According to SurveyMonkey, data suggests that if a respondent begins answering a survey, there is a sharp increase in drop-off rate that occurs with each additional question up to 15 questions.

2) Reduce friction

Our inboxes are ground-zero for survey fatigue. For example, the last time you returned from vacation, how long did it take to return to inbox zero? Did you even bother to read half of the mountain of emails you faced?

The trend is for communication apps to replace email whenever possible, and NPS is no exception. Consider an in-app solution for an experience that doesn’t require the user to remember every specific detail of their encounter, and can give you real-time contextual feedback from customers.  It isn’t unusual for in-app response rates to exceed 40%. At the same time, in-app is less intrusive because customers can easily dismiss or ignore the survey if they are busy.

And for businesses who still choose to interact via email, embed survey questions for higher response rates and less friction. A great example of this (and one you have likely seen) is gathering feedback on your support. Here is a way to integrate feedback without asking the customer to open yet another email.

3) Don’t pester

How often should you survey? Well, how often is your product changing? Are you introducing a new feature set all at once? Making significant UI tweaks every week? If you aren’t changing that rapidly, then maybe asking for feedback quarterly is ok. If not much has changed, then check-in less frequently.

If you want to gain insight into your customer journey, ask for feedback from customers at each milestone along the way. Just don’t ask the same customer at every point in her journey.

If you are asking customers to fill out a survey after every transaction, know that can be a major contributor to fatigue. An example of this is when dining at a restaurant, and the waiter appears constantly to check if “everything is ok.” It won’t be long before what is intended to be great service has the outcome of you being pestered. (Not to mention that the word “ok” is off-putting, because it suggests a mediocre experience.) 

A skilled waiter, like anyone who services customers, will be invisible and will only interrupt the experience to guide it along. They may offer only one specific question at a natural time in order to rate your main experience – “How are you enjoying your salmon (or other main course)?”

No matter what service you provide, you never want to overwhelm your customers. Instead you want to be sparingly curious. If your intention is to provide a vehicle for feedback after each transaction, consider framing it as “is there something we should know?” Sending a “Please complete this survey” is akin to over-serving a table.

By simply shifting the language, people no longer feel pestered. They know that they have a conduit for feedback, framed as a subtle request in case they ever feel inspired to share. They know that representatives of your company are always standing by to listen.

4) Don’t over sample

Many app users switch between desktop and mobile, so you don’t want to double-dip with your requests. Make sure your survey mechanism can see your user’s activity across platforms and take this into account.  

Over-sampling can also happen when multiple departments are surveying customers. Product or Marketing may ask a customer for feedback on your SaaS product or service, and then the customer initiates an unrelated interaction with support, only to get asked again by Customer Support.

The net impact for the customer is, “Hey the right hand doesn’t know what the left hand is doing at this company. I just answered a survey!”  Being clear about the purpose of each survey can help. The best way to handle this is to have one Voice of the Customer (VOC) champion that has the big picture of what customers are being asked and can coordinate NPS (and all survey) efforts, and avoid the faux pas.

5) Be sure to close the loop

If a customer takes precious time to fill out your survey, be sure to thank them.  Better yet, get back to them about the results of the survey and what you are planning to do as a result.  

That kind of transparency is refreshing and demonstrates that you take feedback seriously.   And guess what? That customer will be more likely to open and respond to a future survey.

Always Consider the Customer Experience

The basic principles of customer experience are the same whether you are offering SaaS or grass-fed steak. When it comes to gathering feedback, empathize with your customer’s survey fatigue and err on the side of less is more.  Your customers will be more likely to respond to your surveys.

The name of the game is collaboration. You may have an engineer delivering excellent code, or a business development associate pursuing opportunities for long term growth. If they aren’t working collaboratively with others on the goal of providing a fantastic customer experience, they are holding the company back. Read More…

In my last piece I shared my thoughts on the why Net Promoter Score is so popular. I’ll now share the NPS program model I recommend. It’s intended for the novice NPS program owner, as well as the veteran NPS program owner who isn’t getting the expected traction or results. This model has evolved since the four years when I implemented salesforce.com’s first ever NPS program across 15,000 employees. I’ve since modified it to make it more agile to fit the needs of small and mid-size clients. Read More…

Net Promoter Score (NPS) is the popular metric that shows you how well your company is doing at the job of keeping customers happy. A high score means that the folks who really love your service or product vastly outnumber those who’ve had a negative experience.

That’s valuable information, but a single number doesn’t tell the whole story. In fact, just relying on your company’s NPS could be limiting your ability to attract and retain customers. We’ll explain how segmenting NPS data can be easy, and why it is important to a successful Net Promoter Score program.

What Is NPS Segmentation?

Even if your company provides only one service or product, your customers are not the same. Categories of users have different needs and are bound to experience your company in a slightly different way.

Segmentation lets you slice and dice and see the NPS for particular user groups of your business and determine how you’re faring quantitatively. You’re able to figure out whether everyone feels equally or if the big number is being driven up by one segment and down by another. You then have the ability to make your product or service better for users in those precise segments that lag behind the curve. Thus, it is a very efficient tool for improving customer satisfaction.

Historically, NPS segmentation has required the laborious process of sorting NPS data and qualitative responses in Excel spreadsheets. Using a modern NPS platform like Wootric automates this process, providing segmented customer data in real-time on a dashboard.

Need a Place to Start with Segmenting your NPS?

You can segment by any property that you have on your users – if you’ve dreamed it up as a segment, you’re probably already capturing that data somewhere in your system. (Note: Segment.com users can capture and segment NPS data automatically with this integration.)

Typical customer properties you may already be collecting include:

• Account creation or purchase date.
• The type of product or service that your customers use or pay for.
• Revenue associated with the customer.
• Size or type of business, such as Small Business or Enterprise.
• Customer Persona or other profile info such as Role/Title, Age, etc.
• Location

Take Into Account Your Business Model

The Wootric platform doesn’t have any default segments set up for our customers; we know that every company is going to define for themselves the segments that will provide the best insight into their business. That said, in the course of coaching our customers to set up successful NPS programs, we have seen that various business models tend to want to analyze their data in similar ways. For deeper insight into your overall NPS, use these ways of segmenting users as a starting point:

Software as Service (SaaS)

• Pricing plans, product plans, and cohorts (customer longevity). Does customer satisfaction grow the longer users are with the company? Is there a difference in the NPS of an enterprise customer versus a pro plan user?
• Account-level NPS is particularly useful for Customer Success and Sales Teams that need to monitor the health of large accounts with multiple users. Problems can be quickly identified and proactively addressed to prevent churn.

Marketplace

• User Personas. It makes sense to segment marketplace customers into different “buyer/seller” user personas. For instance, you might have both employers and employees using a recruiting platform and want to isolate the NPS of each group to find out their level of user satisfaction.

E-commerce

• Stage of Engagement. For our e-commerce customers, segmenting feedback from the time of purchase to the moment of delivery produces useful results.
• Purchasing patterns are another valuable way to segment customers in this industry. For example, what is your NPS for customers who spend more than $1000 a year as opposed to those who spend less than $200? Are you drawing in people who purchase shoes than purchase apparel?

Website Visitors

• Device, Geographic Location, Browser. While you don’t have personal information for your NPS survey respondents, you still have information that may be useful to you. For example, what is your NPS for site visitors on mobile versus those that experience your site on their desktop?

Try an Innovative Way to Segment Your NPS: A/B Happiness Testing

Another valuable use of segmentation is to perform A/B testing on different versions of your product or website to see which one yields a higher level of customer happiness. Likewise, you can test a new product or feature on a small subset of customers, using the tool to track their satisfaction until you’ve achieved a high enough level to warrant the product’s general release.

What are the Benefits of Segmenting NPS Data?

When you isolate NPS score by segment, you get a far more meaningful measure of customer satisfaction than you do by looking at a single number — it’s unlikely, after all, that promoters and detractors will be evenly dispersed among all the segments, or that they will have the same desires or delights. This approach lets you know which group of users are your happiest. It also helps you to prioritize your challenge areas so that you know how to take meaningful action to remedy the situation.

The analytical ability to drill down and answer the “why” is much easier with segmentation. It gives you demonstrable evidence of where the key drivers of your business are, which is something that the CEO will want to know off the top.

Segmenting your NPS score also helps you deploy your resources efficiently. Ideally, you can make all user segments happier. But since most businesses need to make trade-offs, segmentation lets you prioritize improvements that boost NPS among user groups that drive the most revenue.

Escape from Excel: How to Automate NPS Segmentation

An NPS survey platform can automate data segmentation, maximizing efficiency. Here are the three steps to do this in Wootric:

1. Determine which segments are the most valuable measures of your business’s customers.
2. Include customer properties in your Wootric installation (instructions here). Note: If you use Segment.io to collect customer data, you may not need to involve a developer. Marketers, customer success, or other non-technical employees can pass user properties to Wootric themselves with a few clicks.
3. Log into your Wootric dashboard to view:
   • NPS by user segment – daily, monthly and by custom period and trends overtime.
   • See Promoters, Detractors and Passives by segment.
   • Sort and respond to user feedback by segment.

Once set up, all NPS survey responses will include your customer properties. It’s a fully automated survey process that gives you NPS data and qualitative feedback you can view through filters you control on your Wootric dashboard. No more excel sheets, no more number crunching after the fact.

And of course, Wootric is always available to consult with our customers. We’re happy to provide extra guidance to help you get set up with segments that are optimal for your business. Everyday, we see how well-executed NPS programs are helping businesses to grow, and we want yours to be successful too!