Net Promoter Score -Why Should Businesses Care?
DRIVING POSITIVE CUSTOMER ENGAGEMENT
Adecco New Zealand, have been surveying our customers for several years. Most recently we have moved to the Net Promotor Scoring system (NPS) which is widely recognised as a leading measure of customer engagement.
WHY SHOULD BUSINESSES CARE?
The importance of human interaction and the correct level of customer service continues to be a vital component of running a successful business, despite the digital robotics era. The techno trend has been thriving to reduce human resource costs in call centres, alleviating the problem of sick days and nonproductivity through use of technology.
However, research shows the majority of people still prefer to speak with a human rather than a computer when connecting with a business, whether looking for general information, to request a new sale or to raise a complaint or query. Poor interaction on these calls has a major impact on business revenue.
Bain & Company analysis shows organisations achieving sustainable, longterm profitable growth generally have Net Promoter Scores (NPS) two times higher than the average company, with NPS leaders growing on average at more than twice the rate of competitors.
HOW IS CUSTOMER ENGAGEMENT MEASURED?
Net Promoter or Net Promoter Score (NPS) is a widely recognised scoring mechanism used to measure the loyalty of customer relationships with a particular organisation. The NPS customer loyalty metric was created by Fred Reicheld, Bain & Company and Satmetrix in 2003.
The NPS metric has been widely adopted with over two-thirds of Fortune 1000 companies, serving as an alternative to traditional customer satisfaction research. Positive NPS is widely believed to have a strong correlation with revenue growth, with many companies conducting analysis to track the links and value of positive NPS. Simple questioning via survey is used to establish how likely it is that a customer would recommend you to others.
WHAT IS A LOYAL CUSTOMER?
According to the ‘Net Promotor Score’(NPS) scoring method, a loyal customer is one that scores the organization either a 9 or 10 on the NPS matrix and as such, that customer is deemed a promoter. Scoring below 9 will not be counted as a promoter and will either be scored as a detractor or neutral. A strong NPS is often deemed to be the anchor of company growth.
Customer engagement and strong customer loyalty are where organisations create deep connections that underpin positive purchase decisions, positive interactions, collaboration in working towards achieving agreed outcomes, and building trusted relationships.
FIVE TIPS TO IMPROVE CUSTOMER ENGAGEMENT
Communicate – Make sure you are constantly and effectively communicating with your client. This includes listening and having an open dialogue where the interest of both parties is looked after. Leverage positive feedback and address negative issues identified where possible.
Be present – Go and see your client, help understand what they see as your role and actively seek to clarify and offer solutions to
their issues.
Don’t assume – Ask questions, make sure you are clear on what is required.
Update – Give feedback, build a trusted relationship and speak openly. Set expectations on what can be expected and realistic timelines to achieve this.
Authenticity – Be wary of doing the ‘nice things’ immediately before a survey launch as the result could go the opposite way to what is intended.
WHAT IS IMPORTANT LEADING UP TO AN NPS SURVEY?
Deciding to measure customer loyalty is the first step to driving improvements. With a few basic steps taken, the survey process is generally simple to implement:
Verify data – Make sure survey data is clean, with valid and up to date customer contacts
Consistent – Do the same thing at the same time every year, you want to benchmark your results and then incrementally improve, comparing apples for apples year on year
Communicate – Communicate your intended survey and the purpose of the survey, encourage feedback and participation from your customers.
Questionnaire – Make sure your questions are relevant and directed at the appropriate level of the contact/client.
Feedback Loop – Share your results with your customers. They have taken the time to provide input so sharing with them what you do with that information and how it shapes your strategy is a good way of showing the organisation is listening and cares about their experience
The Adecco Group places engagement at the top of the priority list and obtains customer feedback to gain insight through the eyes of the customer. NPS provides invaluable intelligence on the customer perspective towards investments, strategies, and areas requiring improvement.
Teresa Moore is Operations Director at Adecco NZ
