The following post is part of a series that will help inform readers of the power that a company’s Net Promoter Score has on its long-term business goals. The previous posts in the series can be accessed via the following links:
- The Top 5 Challenges That Hold Companies Back from Leveraging NPS Data to Develop and Improve Products
- Using Net Promoter Scores to Boost Customer Satisfaction and Loyalty
- The Higher The NPS, The Larger The Market Share
In this series, we have addressed the challenges that often inhibit companies from using NPS data to improve their products. We have also explored how measuring NPS can lead to increased customer satisfaction and loyalty. Additionally, we discussed how companies with higher NPS typically hold larger market share.
Benchmarking Your NPS Against Competitors
Early in adopting NPS, compare your score with others in your industry to gauge its significance to your business strategy. This perspective will show that some industries trend very high in average NPS. In contrast, other industries receive lower scores despite individual companies’ efforts.
For example, 2017 research by Satmetrix found that the average NPS for Department/Specialty Stores was 60, while the average NPS for Internet Service was only 2. If you’re in retail, don’t compare your NPS to that of an internet service company.
Without a definitive benchmark comparison to your competitors, you may struggle to see your market position. You also might find it difficult to determine which score signals the need for significant action.
Calculating Your Score Over Time
To fully understand your company’s customer satisfaction compared to competitors, collect NPS data consistently. Analyze this data over time for a comprehensive view. NPS is the only accurate measure of whether a company’s strategic changes affect customers’ perception of the brand. It provides clear insights into the impact of these changes.
Companies that send NPS surveys only once a year or quarterly risk missing opportunities to impress customers. They may also fail to address concerns promptly.
Consider randomly selecting people daily for your NPS survey and tracking the score constantly. This real-time connection with your customers will drive your decision-making. It will also provide evidence that your decisions are based on data, not impulse.
How to Act on NPS Feedback
In order to be truly successful at boosting customer satisfaction, you’ll need a full system in place to support your NPS survey administration and data collection.
NPS must be a constant topic of conversation across all teams in your business. This includes customer service, marketing, sales, business operations, and anyone else who interacts with customers.
Examine fluctuations in your scores carefully to identify and address their root causes. What are you doing well? What could you improve on?
At many tech companies, small hiccups in software performance often trace back to NPS results. These results can help identify customer segments that want specific updates or changes to the software. Treat this on-the-ground feedback as incredibly valuable across your organization, especially for the product team.
It’s also critical to keep in mind that monitoring and administering NPS questions is not a “set it and forget it” process. Several people should keep their finger on the NPS pulse at all times and be prepared to act on both individual responses and emerging trends.
Feedback as a Promise
These customers have provided input on their interactions with your product or service. By asking for their feedback, you imply that you will act on their responses.
If you consistently ignore customer input, expect them to start abandoning you.
The Secret to NPS Success? Time.
Every company, no matter their services or products, relies on a positive reputation to stay afloat and profitable. As such, most businesses looking to gain traction find themselves requesting feedback. They want to know how happy customers are, how much those customers enjoyed their experiences, and, most importantly, how likely these customers are to speak positively to those around them. Not only that, but companies want to know why their customers feel the way they do.
The biggest mistake that businesses can make is to only ask for customer perception once — most often at the point of sale. To create an accurate picture of customer opinion, smart businesses connect with customers frequently. This includes before, during, and after their purchase. The timing of these interactions depends on the overall objective of using NPS data.
NPS, like all metrics in business, is what you make of it. If you simply ask questions when the mood strikes, there’s a good chance your data will be insignificant at best, and misleading at worst. If you don’t act on the feedback you’re receiving, then what’s the point of even asking? When you take the time to reach out, build a community, and use customer insight to improve and fine-tune your operations, the effects of NPS can be quite significant.
The key ingredient to success, both in business and in the NPS method, is time. A regular approach, effective methodology, and strong community will help your business receive realistic, actionable feedback. At the end of the day, isn’t that ultimately what we’re all trying to find?
