In case you didn’t know, this whole Net Promoter Score (NPS) thing is actually backed up by scientific study.
Frederick F. Reichheld, a business strategist and New York Times Bestselling Author, invented the NPS management system. The system with the standard question and scale is widely adapted by today’s companies. His studies and research lean towards loyalty marketing and loyalty business models.
The answer to the NPS question is quantified and easily computed. The resulting number becomes the Net Promoter Score, which has since become a reliable gauge of client loyalty.
Why Obsess About a Number?
There’s a healthy fixation on the NPS score, as it is considered as one of today’s benchmarks of business performance.
And there’s a good reason why.
NPS Scores let you know if your clients love doing business with you. When they do, then a couple of things happen:
- They buy your products regularly
- They advertise your service to their families and friends without being asked
- They spread good words about you
The effect on your business? Increased revenues and word-of-mouth marketing from satisfied customers. Getting the latter is like scoring raw advertising for free.
According to a study by the London School of Economics, for every 7% increase in your NPS score, your revenue will grow by 1%.
If you still don’t have any idea what your NPS score is, then it’s about time that you discover it. Creating and sending out NPS surveys is easy (and even free) with all the online form builders available today.
Aside from knowing whether you have loyal or unsatisfied clients, NPS surveys can actually help boost your marketing efforts.
The Twofer Move
NPS surveys are like double-edged swords that kill (in a good way) both your growth hacking questions and your marketing goals.
The insights that you’ll get from a NPS Survey can guide your business decisions and give you ideas on how to best deal with your current clients.
NPS Surveys let you categorize your clients according to their loyalty basing on their answers.
- Detractors - Those who gave you a score of 0 to 6
- Passives - Those who gave you a score of 7 to 8
- Promoters - Those who gave you a score of 9 to 10
Get to know the above categorizations in order to better appreciate the following marketing strategies that you can derive from NPS Surveys:
Gain user testimonials
Getting customer testimonials can be awkward if you directly ask your customers. NPS surveys are non-icky ways to get tons of them.
The ultimate question of recommendation on a NPS surveys is usually accompanied by the follow-up question, “What is the reason for your score?”
This open-ended question gives you more insights on how your company is doing.
Extremely satisfied customers – called Promoters – are usually ecstatic to share the things they love the most about your company. They are the people who, without question, will recommend you to family or friends. Yes, they sort of love you!
Listen to the Passives as well. This group of clients are those who are just so-so. They don’t dislike your company, but they don’t care enough to patronize or promote you either. But you will probably receive nuggets of wisdom from their feedback.
Detractors, on the other hand, are usually fired-up to point out where your company went wrong, what they disliked about your product or service, and other negative feedback.
To get awesome testimonials, focus on your Promoters. They have good things to say about you.
What you want to take advantage of is the good feedback that’ll be flowing from your promoters.
Guess what these things can double as – customer testimonials! Customer testimonials can be used on your website, social media posts, and in other marketing materials.
Of course, you have to get these testimonials legally. Ask permission. It can be as simple as adding a permission checkbox towards the end of your online survey like this one:
Ask the customer for their name and the company they work for when they check the box for testimonial credibility.
For additional safety, you can add a tooltip explaining how you intend to use the testimonial and how you are going to keep their identity anonymous, if they prefer that option.
Increase your customer lifetime value (CLTV)
Remember your Promoters and our Passives?
Tag them in your Customer Relationship Management (CRM) software so you’ll know who to take care of the most.
Invest in these people as they are the ones who can help the most in increasing your customer lifetime value (CLTV), which is the projected revenue that you will receive from one customer throughout their relationship with your company.
In short, taking care of your existing customers benefits you in the long run, and increases your revenue.
Why should you focus on your existing customers more than your newly acquired ones?
Because as per Inbound Rocket:
So, how can identifying your Promoters and Passives help you increase your CLTV? By nurturing them through email marketing.
Email content that works for Promoters and Passives include:
- Exclusive webinar announcements
- Free e-book reports or white papers that they can relate to
- Hacks that they can use with your product to grow their own businesses
- Monthly newsletters containing blog posts about company updates and how-to’s
- DRIP emails that help them make the most of your tool, product or service
If you can teach your clients how to grow their business, or to be better versions of themselves through what you offer, they will be loyal to you for a long time.
Who knows? You might even turn those Passives into Promoters.
Improve overall customer success
Now, let’s talk about your Detractors.
There are two good reasons why you shouldn’t ignore them:
- 75% of customers have indicated that they will likely share a negative experience with their friends and colleagues
- Around 50% of detractors are most likely to churn (or leave) within the next 90 days
Ignoring Detractors equates losing money.
Negative reviews may turn off potential customers and, if they pile up, you may earn a bad reputation in your line of business.
Leaving Detractors unsatisfied may also cause them to leave if you don’t do anything about it.
If the Detractors have reasonable concerns and problems, help them solve those. There might be an existing solution that they just don’t know of yet. If they have unique problems, create solutions if you can.
Here are ways on how you can deal with Detractors:
- Automate an email response inviting them to a call or chat about how you can fix their problem
- Dedicate a person, or a team, whose job is to turn Detractors into Passives, or better yet, Promoters
- Re-route appropriate Detractor feedback to your customer service support team
- Check-up on Detractors after a couple months later. Have they churned? Or do they now give you a higher score in the NPS survey?
Having NPS Detractors isn’t such a bad thing. Their honest feedback will help your company grow.