Using the Net Promoter Score for your Business
What are your customers saying about you? Wouldn’t you like to know? Word of mouth has been long known as a very powerful form of marketing. It is often most blatant in the undeveloped world where businesses thrive on reputation without the luxury of large marketing budgets like Apple, Coca-Cola or Nike.
It’s always fascinating to note the stall at a market with the longest queue. I put this to the test on a recent trip to the Queen Victoria Markets in Melbourne and tested several stands, including the busiest. On appearance they all seemed of equal offering, but the crowded stall had by far the best product, and everybody lining up seemed to be well aware of their reputation as the best.
But how do you measure word of mouth or the loyalty of your customers? How do you know when they walk away from your stall or business that they will recommend you?
The Net Promoter Score (NPS) is a simple tool that was developed to measure exactly this.
Long gone are the lengthy, costly customer surveys filled out by bored students and discarded by most. The Net Promoter Score is a calculation of your customer’s loyalty with just one simple question:
“How likely are you to recommend (your business) to a colleague of friend?”
The customer then ranks their response on a simple 1-10 scale, with 1-6 being classed as Detractors, 7-8 Passives (those who weren’t fussed either way) and a 9 or 10 being a Promoter (those who will actively recommend you to their friends).
From here a simple calculation of the percentage of Detractors subtracted from the percentage of Promoters obtains your Net Promoter Score. This Net Promoter Score Calculation can form a powerful tool for your business.
Whilst a common measurement tool in the U.S.A., the NPS is still relatively new to Australia although I’m seeing the survey in my inbox more and more as of late. It’s always one I fill out as it takes less than a minute to complete, and I know first hand of it’s powerful nature to deliver feedback.
Additionally, it gives you the opportunity to touch base with your customers after their experience, to find out what went wrong, or what was right. I’ve been using this survey for about a year and a half now and we find the feedback invaluable. In fact, on most occasions when we contact our Detractors – we end up solving their problem or alleviating their frustration moving them up the ranks to a Passive or in some cases even a Promoter. The damage a Detractor can do to your brand can be considerable, so eliminating as many as possible is a sure-fire way to improve your brand!
A smart company will take the results and feedback and be unafraid to make appropriate changes, after all your business is driven by your customers, not you. The more positive word of mouth that you can generate the stronger your brand or business will be. How else does that market stall thrive?
