Every company, no matter its services, products, or abilities, relies on a positive reputation to stay afloat. Whether this perception is in the media, within an industry, or word of mouth among friends, a company everyone hates isn’t likely to stay open for long.
As such, most businesses looking to gain tractionfind themselves requesting feedback. They want to know how happy customers are, how much they enjoyed their experiences, and, most importantly, how likely they are to speak positively to those around them.
The biggest mistake these businesses make is to only ask once. Instead, to create an accurate picture of customer opinion, smart businesses connect with customers frequently.
The most common method? Net Promoter Score, or NPS. This concept, which relies on the human predilection to boast about successful interactions or amazing purchases, involves surveying customers after a completed transaction with one, easy-to-answer question.
When handled properly, these feedback requests can provide an accurate look into how the world sees your business.
How Net Promoter Score Works
Despite the seemingly complex name, obtaining a net promoter score only involves one simple question: how likely are you [the customer] to recommend a business to a friend. Scored on an 11-point scale from zero to ten, customers are asked to choose a number that corresponds with their enthusiasm. Zero is generally the equivalent of “not at all” while 10 indicates “extremely likely.”
Rather than assigning value individually to every numerical score, scores are grouped into three buckets. Scores of nine or 10 are considered promoters, or the people most likely to actively say good things about your company.
Scores of seven and eight are passive participants. These people liked what you had to offer, but not enough to promote their experiences without prompting.
Scores of zero to six are seen as detractors. These customers did not have an above average experience, and are most likely to spread negative feedback that will hurt your reputation in the public eye.
In order to calculate Net Promoter Score, the percentage of total detractors is subtracted from the percentage of total promoters. The difference is then expressed as an absolute number, not a percentage. While a higher number is obviously for the best, any positive score is considered a good sign for your business. The national average? Around 10.
The Shortcomings in Net Promoter Score
As all business analysts know, there is no such thing as a perfect metric. Net Promoter Scores, much like many approaches to customer feedback collection, only work when performed properly. Unfortunately, there are a few negatives to this method that can detract from results, especially for companies who don’t have the know-how to plan ahead.
Lack of Specifics
One of the biggest criticisms of the Net Promoter Score is a lack of specific guidelines. Customer ratings are completely subjective, and many customers will arbitrarily pick a number without putting much thought into the process. There’s no real way to relate one customer’s experience with another’s, leaving no way to draw a truly objective conclusion.
For promoters and passive participants, the window of answers is quite small. Most customers would have to feel very strongly about products to choose a nine or a 10. The range assigned to passives, however, is much more forgiving. Theoretically, the difference between a zero and a six should be vast, but the NPS method leaves no way to distinguish this.
Lack of Action
Despite the best of intentions, humans often have a hard time predicting their future behavior. An enthusiastic customer isn’t necessarily a chatty customer, and someone who rates their likelihood of recommending your service as a 10 is under no obligation to actually do so.
Lack of Direction
So, a customer hated your product. But why? This is one critical step the NPS system omits. Without a way to explain why a recommendation is or is not likely, there’s no way for a company to learn and grow accordingly. Some people may rate an experience with a zero because they hated you, while others may choose zero because they dislike talking about businesses with their friends. There’s no way to draw an accurate conclusion without more details.
Many NPS administrators try to solve this puzzle by including an additional question – an open text box that asks either why a customer didn’t rank you higher or if they care to leave feedback as to why submitted rank a nine or 10. Question logic allows survey designers the flexibiity to tweak messaging based on responses.
Why Time Matters
Have you ever made a purchase with a company that you really, truly loved? Of course; we all have, and this is what all companies strive to achieve. This point, however, is usually where most New Promoter Scores stop. Customers are happy, and that’s all that matters.
However, to truly make good use of what this method can offer, simply soliciting random consumers at random times isn’t enough. In fact, many proponents of NPS argue for use over the course of time, surveying the same people again and again in order to create an insight community that can truly shed light on how well a particular business element is performing. This method offers many advantages that can negate the most common shortfalls of this system, providing a more realistic and objective rating opportunity to companies in need.
As the shortcomings above indicate, a lack of specifics is a big downside. However, soliciting ratings from the same people over time can negate this issue. If a user continually gives a nine after initial purchases but a six a few months later, the six rating can be assessed relative to the first experiences. This implies a specific change in your performance, which is far more valuable than an arbitrary rating from a new customer.
Indication of Action
Asking a customer if they are likely to recommend you only goes so far. Asking the same customer at a later date if they did actually recommend you goes much further. This strategy both provides context to your requests, and also indicates the correlation between a high likelihood of recommendations and actual recommendations.
Performance Over Time
Building a community of responders allows you to check in on how your customers are feeling about your business, providing you access to real, relatable results. This ability to follow up on previous shoppers, ascertain changes in perception, and collect opinions at regular intervals adds both direction and action to a previously passive approach.
Business Success With NPS Feedback
Net Promoter Score, 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. 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; with a regular approach, an effective methodology, and a strong community, your business is poised to receive realistic, relative feedback that actually matters. At the end of the day, isn’t that ultimately what we’re all trying to find?