Is your business model based around great customer service? If so, do you measure how good your service is, and whether it is improving? If not, then Net Promoter Score might be the tool that makes all the difference to your business. We chat with Dominic Monkhouse, who has used net promoter score to transform service delivery in a number of different organisations.
Net Promoter Score
Dominic lives near Salisbury and works with a company called Shirlaws Group, helps companies between £2 and £12m growth fund or exit. His background is IT services. He is a sales and marketer. His secret sauce in his career was staff engagement and customer experience, he has experience in:
- Hiring the best people;
- How do you keep the best people?
- How do you engage them?
Then, how does that manifest itself to produce great customer experience? Then, how do they buy more stuff off you and tell everybody about you.
So what is Net Promoter Score or NPS?
We should note that NPS now stands for NET PROMOTER SYSTEM – it’s not all about the score. Net promoter score originates with a Fred Reichheld article in Harvard Business Review. https://hbr.org/2003/12/the-one-number-you-need-to-grow
Net promoter score gives a very simple measure of customer satisfaction.
ONE QUESTION: Would you recommend The Next 100 Days Podcast to a friend or colleague?
This question is scored on a 1 -10 scale
9-10: are satisfied enough to recommend you. – these are promoters
7-8: are neutral, they won’t act, they won’t hurt you, but they won’t recommend you.
6 and below are detractors, they are likely to get away from you, and potentially are customer terrorists and may well tell everybody that you are rubbish.
Add up the number of people who give you a 9 or 10, then take away those who gave you 6 and below. 7-8 are neutral. That gives you the NET PROMOTER SCORE
NET PROMOTER SCORE = # Promoters – # Detractors
Ideally you are looking for a positive score. Most organisations will have a single digit net promoter score. A world class net promoter score will be is in the 80s.
Ask a supplementary question: Why did you give that score?
Once your customers have provided their score, you would follow them up and ask them WHY they gave that score today. This gives free text thinking help to understand how customers are thinking about your business.
You can measure across touchpoints in an organisation. Finance team sending bills etc. CEO could have a relationship score. Its not just about the external customer, many teams serve internal customers so its a great way of measuring performance of e.g. an IT help desk.
There is often a 10-20% difference between a transaction and relationship score.
Is this an easy thing for someone to set up?
At one level, it is simple. Send an email. Get replies. But Dom advises you to build a system around this. SAAS platforms are available. https://www.livechatinc.com/blog/what-is-net-promoter-score/
Transaction score of 4, you’d want to call and say that’s terrible how can we alter what we do in future to get you to a 9?
Tips and tricks.
- Make the first communication about NPS from you as the CEO. This is important to me. If at any time you have a problem, this is my email address, this is my telephone number – give me a call. (in 20 years, Dom has done that, and only 5 people called him out of hours).
- It’s not a department thing. It’s a company thing.
- After the results come in, send them feedback and tell them what you have done. So many surveys don’t let people know the results of the survey.
Net promoter score and driving more referrals
Dom’s experience is that 9s and 10s SPEND MORE MONEY. A 9 and 10, they ring them up and say who have you referred us to? I haven’t, they’ll give you a name or two and you have business development ammunition.
If you can get the 9/10 to do a referral, then you are pre-sold. They’ve already said you are amazing. You don’t need to sell them.
How do I turn 7-8 and 0-6 into 9-10s?
The free text field will help. It gives you specific feedback about departments – that you may think are performing admirably. i.e. Your invoices are impenetrable and your debt collection staff are rude and aggressive! So, can you fix stuff around detractors?
Also, some people are consistently giving you a 4 but are customer hostages – so maybe it’s an opportunity to reduce their negativity on your team, raise their prices and get rid of them.
Target the detractors first! Its easier to turn a detractor into a neutral than a neutral to a promoter
Is this the KEY to the Golden Gate?
Dom recommends the book HOW FULL IS YOUR BUCKET? By Tom Rath https://www.amazon.co.uk/Full-Your-Bucket-Positive-Strategies/dp/1595620036
Product, services and staff. Restructure your teams where they give great service and not great service. Dom says your external customer experience is NEVER better than your internal processes?
Ask the question about MANAGERS. To get an idea of culture, working styles. Manager or culture? Dom mentioned a lady talking about leadership. On her slide: Most people have worked for S*** leaders. What are the chances of you NOT becoming a S*** leader?
Is Net promoter score a useful consultancy technique? Is it readily accepted by businesses where it is new to them? The customer satisfaction industry initially poo-pooed it. But Dom says it works well if your mindset is you want to improve. It gives you a benchmark versus other industries.
Isn’t the score about referrals ultimately?
Unless the join is made to the referrals. Growth comes from mitigating churn too. Promoters will spend more and stay with you. A 5% churn reduction can increase profits by 25%-85%.
Therefore, net promoter score gives you an indication of where customers are letting you down. 0-6 customers are susceptible to an approach by a competitor.
First Direct has an 80s NPS. Graham set them up with their first postcode! A major part of their success!! LS98 1FD.
You can structure a marketing plan around the Net promoter score
When was the last time they bought? The Recency, Frequency & Monetary measure (Listen to the Brian Kurtz podcast).
Dom advises doing things in small manageable chunks. A monthly cadence of improvement. It’s about a mind-set.We compete on service… Is it any good? How would you know? Measure how much people value your service.
If it doesn’t get measured, it doesn’t get done, or improved.
In the next 100 days, what do I do to make a difference?
Look at the article from Reichheld. The NPS link https://hbr.org/2003/12/the-one-number-you-need-to-grow PLUS Zero defects https://hbr.org/1990/09/zero-defections-quality-comes-to-services
Look at NPS SAAS tools – such as https://asknicely.com
Most of the time you get a negative score, normally they want to improve. You respond to people you like. If you have segmented your customers by revenue, do weekly blocks by survey. Tell them it’s coming in advance. It’s important, please give us feedback.
ASK: Is there ONE thing that I’m not doing as well as someone-else you deal with? Your customers must keep us honest.
How many companies are trying to GAME the score? i.e. Car dealerships. Don’t worry about the score. It just must go in the right direction.
Dom is also a motivational speaker. He referenced his friend and author Henry Stewart https://happymanifesto.com/author/henry-stewart/
How do people get in touch with Dominic:
Dominic Monkhouse – LinkedIn