Implementing Net Promoter system successfully

Written by: Kushal Dev | Co-founder, Customer Guru

How many times have companies gathered feedback from you and then vanished into thin air? These feedback surveys may be the long detailed ones with a never ending stream of questions or the single question Net Promoter® surveys. In either case there is no point if all this gathered data sits on research team shelves for future reference. So what’s stopping organizations from using this valuable data?

• Maybe companies are biting more than they can chew. Enormous amount of data does not always equals meaningful data that can be easily comprehended. Companies need a simple and easy to understand metric likeNet Promoter Score®.
• Many companies have effective NPS data collection systems in place but that is just the tip of the iceberg. A right system to derive meaning of this data and capacity to reach out to individual customers is required.
• It’s important to link individual customer feedback to products or services, touch-points and business functions within an organization and establish a communication roadmap across the length and breadth of an organization.
• Organizations tend to statistically analyze the data collected to create comprehensive reports and, more often than not, the data may become dated by then. What however is important that organizations listen to their customers at right touch points. Analyze this feedback and derive actionable insights. Tool like CustomerGauge help easily capture, slice and dice data to achieve this. It can help you know your customer better, WOW them and understand how their customer experience effects the bottom line.

Now that we understand what organizations need to do then the next obvious question is. How can this be achieved. These are the best practice steps you need to undertake to implement a successful NPS process [1].

1. Initiate

An NPS program needs to trickle from top to bottom to make it a success. The initiate phase is about senior management buy in and defining the corporate governance structures that is required to drive change. Identify the teams to run the NPS program as per the governance structure, their key members and the charter of these teams.

2. Customer Strategy and Context

Once the program has been initiated you need to focus on the customers. Its important to identify which customer segment you want to target. What is the criteria of identifying this segment and what are the key touch points to interact with this segment. The goal is to identify the key opportunities that you need to quickly tackle to improve business performance.

3. Listen and React

Now you should get down to data collection through survey design and implementation phase. The primary part of the Net Promoter system survey design process is the NPS question. “How likely is it that you will recommend our product/service to a friend or colleague?”

Is the NPS score enough? To execute a successful NPS program its important to understand the reason behind this score. Its of minimum use if you just collect the NPS score without the supporting data to understand what drives this score. A transactional NPS survey which requires you to collect, analyse and act on feedback data every day, day and day out requires the right tool to enable this and derive actionable insights.

The react phase is key to generating customer loyalty. An important aspect this phase is to reach out to unhappy customers and making them happy.  This can be ensured through a solid service recovery (Actions taken in response to service failure) system in place.

4. Quick Wins

Once the system is in place its important to quickly showcase some result. Ample effort has been put in establishing this system and some early result instills faith in it. The changes can be as simple as easier client interfaces or empowered front-line employees.  If you can show uplift in your NPS score you then you are on the right track. Linking it to higher conversation rates or the bottom line is even better.

5. Big Bets

Having proved that NPS process works, it’s time to move on to bigger bets.  Quick wins should have developed the confidence and respect of management so business case for big bets like product design change, process change etc get approval easily.

Reach Kushal at kushal@customerguru.in

[1] An Adaptation by Genroe from “Answering the Ultimate Question: How Net Promoter can Transform your Business”, Brooks, Lara, 2009

An Indian context to NPS

Written by: Vivek Jaiswal | Co-founder, Customer Guru

Since my return from Amsterdam, I have been repeatedly told that it’s great to have the experience of helping European organisations implement NPS, but I’ll have to keep the ‘Indian context’ in mind while implementing the same in India. Some even cast doubt on whether NPS is applicable in India because Indians rarely respond to surveys. It got me thinking if it’s actually true, if there really is an ‘Indian context’ to NPS. With respect to the same, I would discuss three major questions.

1. Is the NPS question relevant to the Indian community?

2. Do Indians have a relatively low response rate to surveys vis-à-vis people of other nationalities?

3. Can NPS be skewed because Indians are culturally inclined to give low scores?

I started by conducting small experiments locally. Whenever I went out to purchase anything of value – a new mobile connection, an Internet dongle, or new earphones for my iPhone, I would always ask the NPS question to the salesman:

Would you recommend this product to your friends and family?

And

Why?

It was a fun experiment because almost always it made the salesmen think for a while. It was different from asking ‘Is this product good?’ to which they instantly responded ‘Yes! It is one of the best set of earphones we have.’ But when asked the NPS question, I was given an honest answer – ‘you should buy this one instead because it has so and so advantages over the other one’ OR ‘absolutely, in fact a friend of mine has the same product and is very happy with it.’ Having run this simple experiment across several small and big purchases, I received the same level of engagement from the sales people. It reinforced my faith in the NPS question and it is safe to extrapolate the observation across all Indian organisations.

Now comes the question of whether we Indians have an inherently low response rate? That is to say that we rarely respond to surveys. I believe that culturally we are very enthusiastic about sharing our product knowledge with others. Like the rest of the world, we regularly seek and offer opinion about products/services we would like to or have used, often volunteering to help with purchasing decisions. Though offline, these are manifestations of customer feedback. Then why is it that companies fail to capture them? In a recent call with a prospective client, I was told – “Customers don’t have the time to respond to surveys.” it prompted me to think “Yes, as long as they are sent 10 page long questionnaires, the response rate will remain abysmal.” Traditionally customer surveys have been extremely lengthy. And, along with corporates, customers have come to believe that if it’s a customer survey; it will be lengthy. However, does the length of a survey really affect response rate? Well, our dear old Surveymonkey guys have the answer to that. As one of the most widely used survey platform, Surveymonkey studied around 100,000 customer surveys for a correlation between respondent dropout rate and length of the survey. The results are depicted in the following chart:

C, Brent. “Does Adding One More Question Impact Survey Completion Rate?” SurveyMonkey Blog. https://www.surveymonkey.com/blog/en/blog/2010/12/08/survey_questions_and_completion_rates/ (accessed July 20, 2014)

So, if you are a company that really wants to improve customer response rate, you have to cut down the number of questions. It’s that simple! Again, since NPS relies on asking just the two questions I mentioned earlier, its response rates are phenomenally higher than traditional customer satisfaction surveys. To give you some perspective, CustomerGauge, our technology partner, gets NPS response rate of  >60% in B2B and >25% in B2C. This is across more than 130 countries that CustomerGauge receives responses from, India included.

Finally, some would also point that NPS could be skewed because of cultural bias: that Indians do not have a tendency to rate an organization very highly. However, in contrast to the notion, I believe Indians are more generous in that regards compared to their European counterparts. On a global scale if India scores lower than other markets, it should not be assumed to be because of a cultural bias, rather the service quality in India should be closely observed. As long as service levels are delightful, companies can be assured of receiving a 10 from Indian customers. Adam Dorrel’s (CEO CustomerGauge) blog – “Net Promoter: is there a ‘Dutch effect’?” corroborates this view.

It is important to understand that NPS is a way to measure customer delight and is a must have for every organisation. What Indian organisations really need to implement are the processes that make it easier for customers to share feedback and NPS facilitates that process most effectively.

What is Net Promoter Score® or NPS®?

Written by: Kushal Dev | Co-founder, Customer Guru

Net Promoter Score® is a loyalty metric developed by Fred Reichheld, a fellow at Bain and Co. In 2003. It is a management tool widely replacing the traditional customer satisfaction (CSAT) research and is being used by global brands to gauge the loyalty of their client relationships.

It is based on the fundamental construct that by asking one simple question –

“How likely is it that you would recommend our company/product/service to a friend or colleague?”

Measured on a scale of 0 to 10 every company’s customers can be divided into three categories

1. Promoter (Score 9 and 10) These are loyal enthusiasts who will keep buying and referring others thus fuelling organic growth
2. Passives (Score 7 and 8) These are satisfied but unenthusiastic customers who would easily switch for better offering
3. Detractor (Score 0 to 6) These are vocally unsatisfied customers who damage your brand and impede growth through negative word of mouth

NPS = % Promoters – % Detractors

Net promoter provides easy and quick customer feedback. The power of NPS however is not driven from data collection but from using this data effectively. Its easy to collect data using any of the survey tools available online but can effective data collection alone lead to NPS success? The real value is in evaluating this data effectively and deriving actionable insights so you exactly know the actions you need to take to delight your customers. An organisation striving for NPS success needs to realize that NPS is not just about measuring customer loyalty but also a way of doing business. NPS should be seen as a change agent that transforms an organization into a customer centric one.

Disclaimer: Net Promoter, Net Promoter Score, Net Promoter System, and NPS are trademark of Satmetrix Inc., Bain and Co., and Fred Reichheld.