NPS 101: Promoters
In this post, we explore NPS Promoters. This is Part 1 of 3 NPS 101 lessons we will be publishing over the next few weeks. Stay tuned for follow up lessons on Passives and Detractors.
What is NPS?
NPS (Net Promoter Score) is a customer satisfaction benchmark that measures how likely your customers are to recommend your business to a friend. It is a measurement used to evaluate customer loyalty too. It differs from CSAT (customer satisfaction) or CES (customer effort) metrics in that it measures a customer’s overall sentiment about a brand, rather than their attitude towards a specific interaction.
NPS is simply calculated based on the question – “On a scale of 0-10, how likely is it that you would recommend us to a friend?” And the results determine if a customer is a Promoter, Passive or Detractor.
What is a Promoter?
A Promoter is a customer who gives a score between 9 and 10. These are your loyal customers who will recommend your business to their friends and colleagues and who carry a high customer lifetime value (CLV). Promoters are your happiest and best customers and the more you have, the better your business will fare.
Both promoters and loyalty programme members are two categories of customers that spend more, so if your business is excelling in these categories, you will see higher returns. American Express, for example, sees a 10-15% increase in spending by promoters and far better retention rates.
Customer lifetime value increases when they promote your brand to bring you new customers who will hopefully continue the trend; with the lifetime value of a customer obtained via referral being 16% higher than a non-referral customer. The value of a word of mouth referral is significant, with 92% of consumers trust recommendations from people they know and 70% trust opinions posted online. Furthermore, nearly 65% of new business comes from referrals, so the lifetime value of a loyal customer who is a Promoter is multiplied when you factor in their willingness to advocate for your brand. They are spending more and bringing you new customers who will also spend more than a customer obtained via a traditional new customer acquisition strategy.
In an ideal world, every customer would be a Promoter, but unfortunately, this is not usually the case. And oftentimes your NPS scores will more heavily reflect the experiences of unhappy customers, who are eager to vocalise their displeasure, rather than satisfied customers who were pleased enough with your business to not feel the need to leave feedback.
All too often, Promoters are overlooked. Because they are already satisfied, a lot of businesses take them for granted. Detractors usually bear the brunt of the remediation efforts of CX departments because their dissatisfaction will mean they could easily never return and could tell their friends about their negative experience. They demand a lot of attention as keeping an existing customer tends to cost a lot less than gaining a new customer. Brands spend up to 11x more on recruiting new customers than retaining existing ones, but the existing customers are where the true value lies. But a customer who is loyal and satisfied now, may not stay that way, so it is important to pay close attention to Promoters as well to maintain their level of satisfaction.
How to get the most from your Promoters
Close the loop on positive feedback
Happy customers will often leave a really kind or useful comment praising a specific customer service experience, staff member or product. You should personally follow up with them to express gratitude for their comments or tell them how you plan to action their feedback. For example, if a customer says they really appreciated how a specific employee went out of their way to help them with a problem, let them know that you have shared that feedback with the employee in question and they were really grateful for the positive feedback. This added level of personalisation will make the customer feel that their feedback is valued and encourage them to continue to leave positive feedback in the future (therefore positively impacting your overall NPS scores).
Redirect them to social media channels
If a customer leaves you a high score in an NPS survey, ask them to “walk the walk” and resubmit that score to a review site such as Trustpilot or Google Reviews. In this way, they are not only recommending you to their friends as suggested in the NPS question, but also to strangers who might be looking for recommendations online. At CX Index this is done via our Social Advocate tool which automates the process of turning your most satisfied customers into online brand ambassadors. The tool enables you to better engage with your customers to drive authentic positive content from customer feedback onto popular review and social media platforms. It has an incredibly strong track record of enhancing online reputation in both the quality and quantity of reviews. You can download a brochure to learn more HERE.
Thank them!
It’s nice to remind customers who are consistently happy with you that they matter too. This can mean offering incentives, but sometimes just a note of appreciation or thanks, an unexpected bonus like expedited shipping, extra loyalty card points or early access to new products can mean a lot to your customers. Customers enjoy a bit of personal attention and personalisation and it isn’t difficult or expensive for you to offer this to them. Reinforcing that they matter to your business will, in turn, strengthen their loyalty to you and their likelihood to spread the word about how great your business is.
