Customer Success management is a hot topic these days and for good reason: keeping your customers happy is a necessary component to growing your business. But how does one go about quantitatively measuring the satisfaction of a client? And how does this actually contribute to a Customer Success program?
One valuable tool to gain insight into what your customers want is to determine your company’s Net Promoter Score® (or NPS®).
Your NPS doesn’t ask your customers to rate a specific purchase or interaction; it measures their overall satisfaction and loyalty to your brand. Your score will ultimately tell you if your customers are happy and willing to refer your products or services to others. It’s truly a window into your performance directly through your customer’s eyes. Before diving in, be sure you understand why it matters and the value your company’s score can give you.
What is an NPS?
An NPS is a simple tool to gauge the loyalty of a company’s customers. As simple as it may sound, this is determined by asking your customer one question: “How likely are you to recommend (company name) to a friend or colleague?” The customer is then prompted to choose a score between 0 and 10, which is used to calculate your company’s NPS (more on that later). Since the question is about how likely they are to recommend your company, as opposed to their experience with a specific transaction, the score can be used to predict potential growth through customer retention and referrals. While growth is not guaranteed, of course, identifying those that love your product or service and cultivating their loyalty can help drive growth by converting those passive customers into active promoters and increasing your customer base.
Given the 10 point scale, the responses collected bucket your customers into three groups:
- Promoters: These are customers that rated you a 9 or 10. They are loyal to your brand, happy to sing your praises and ready to actively recommend you to friends and colleagues.
- Passives: These are customers that rated you a 7 or 8. They are more indifferent to your brand and likely will not actively recommend your company.
- Detractors: These are customers that rated you a score of 0 to 6. They are unhappy customers who are likely to actively discourage others from doing business with your company.
The NPS is calculated by subtracting the percentage of respondents that are detractors from the percentage of respondents that are promoters, generating a score from -100 to 100.
A few best practices to consider when sending the survey:
- Keep it simple. While you can’t change that one important question, you can customize your survey by adding a follow-up question. The default follow-up is “Will you share why?”, but you can modify that to gather specific data that is more relevant to your company. For example, you might ask about how you could improve your products or services, or what you could do to make them more likely to recommend you – the options are endless. This open-ended question allows customers to share their feelings in their own words. While it may be tempting to add multiple follow-up questions, it has been shown that with each added click or question, the chances of someone completing your survey drop 50%. If your survey is short and sweet, people won’t mind taking the time to complete it.
- Don’t survey all your customers at once. While you’ll want to get feedback from as many customers as possible, if you send your survey to your entire database at once, you’ll only see feedback from everyone at that point in time. If you spread them out, you can see trends in feedback and make adjustments if the numbers are moving in the wrong direction.
- Include a representative sample of your customers in each send. If your customers come from varied industries or departments, be sure to include customers from all these groups in each survey send. It’s the best way to see the big picture, as well as specific areas that may need improvement.
- Repeat once per quarter. Since we want to gauge brand loyalty, sending once a quarter is better than after each transaction. This will allow you to watch for shifts in feedback and adjust accordingly. You don’t want to send the survey too often, but just enough that you can see drops in your score before it’s too late.
How do you deliver the survey to clients?
The best way to deliver the survey is to email customers a link to the survey using a service like Typeform, Promoter.io, SurveyMonkey or another survey app – or simply using a link to a Google Form. The advantage to using the survey apps is that they will help you make sense of all the data by keeping track of responses and documenting trends.
Should survey responses be anonymous?
To support the goals of your Customer Success program—which should include using data to proactively identify both opportunities to generate referral business (or new content, like case studies and success stories) and red flags where an unhappy or ill-equipped customer is on the brink of leaving you—no, customers who respond to your NPS survey should not remain anonymous. Of course, they should be very well aware of this before completing the survey, but in order to intervene and resolve an issue, your team needs to know where the issue is coming from.
Some Success specialists have said doing away with anonymity can have a negative impact on the willingness to complete the NPS survey or that it might influence the scores they give. So it’s best practice to stress that honest feedback is critical. After all, in order to identify patterns, as well as to know when to ask for a testimonial or referral, you need to know who is saying what. However, in internal use cases—an employee satisfaction survey, for instance—we argue that responses should remain anonymous in order to maintain the integrity of the results.
What do you do with the results once you have them?
The power of the survey is not only your NPS, but the additional feedback submitted with it. One of the key mistakes companies make is to not follow up with those customers that took the time to respond. Another reason for sending the survey in batches is so you have the time to thank your customer for responding and build that deeper relationship with them, hopefully encouraging the passives to become promoters.
Since you’ll be getting updated results every quarter (or at whatever frequency you decide on), be sure to watch for changes. Also look at customers from each industry or department to map trends. Whatever may begin suffering can be addressed and your own customers will help you move the needle back in the right direction.
The NPS survey is not just a number, it’s a vehicle to start a conversation with your customers and learn what they want and what you can do to keep them as a long-term customer. It’s an ongoing process that should be the cornerstone of your Customer Success management plan. Insights like this are necessary to retain your current customers and mitigate churn as much as possible.
Note: Net Promoter, Net Promoter System, Net Promoter Score, NPS and the NPS-related emoticons are registered trademarks of Bain & Company, Inc., Fred Reichheld and Satmetrix Systems, Inc.