Net Promoter News: Brooks Brothers, CTCA "Digital" Hospital, Temkin Asks Temkin, HAPPY Radio
News snippets for Friday 27 Feb:
Net Promoter in the Health segment
Cancer Treatment Centers of America (CTCA) report that their highly “wired” approach to healthcare (electronic records, networked equipment, patient-centric care) also allows them improve clinical care as well as to track patient satisfaction. CTCA uses Net Promoter Score methodology, and says that more than 90% of their cancer patients would recommend another patient to a CTCA hospital. Source: PRnewswire.
Brooks Brothers find tailor made NPS solution
High-end apparel retailer Brooks Brothers confirm they use the Net Promoter Score. Announcing a new CRM system, Brian Dean, VP of direct at Brooks Brothers said “[our] idea is to improve relevance of mailings while honoring customers’ preferences for contact frequency”. Dean added that the company will be carefully watching its net promoter scores throughout the year. Source: DMNews.
Temkin Self Q&A on NPS
Bruce Temkin, customer experience sage and Vice President & Principal Analyst at Forrester Research writes an excellent Net Promoter Q&A by asking himself some searching questions, including:
Q: [...] is Net Promoter a good thing?
Yes, absolutely! [...] it’s made customer experience relevant to the executive suite. And [...] it has introduced a common language around customer segments: Promoters, Passives, And Detractors. The use of common vernacular is a very powerful tool for aligning organizations.
Q: What should companies using NPS do going forward?
First of all, get everyone in the company to use of the three labels for customers: Promoters, Detractors and Passives….
Source (along with other useful Net Promoter wisdom): Customer Experience Matters.
Public Radio scores Net Promoter of 76.
The late Edwin Starr would have probably been a promoter too. US Public Radio scores average NPS of 76. (women 80, men 72). (undated) Source Ron Cook KBYU (ppt)
EU Court slaps eRetailer over fee for faulty used laptop
A case that was settled this week in the European Court of Justice (ECJ) in favour of the consumer concerned a German distance retailer that tried to charge a buyer who returned a second-hand laptop for the eight months of use she had had from it. The retailer said that the woman had got eight months of use out of the €278 second hand laptop before the screen stopped working. The ECJ ruled that Germany is NOT allowed to have a law allowing the charge for use.
Know the law
The case should be of interest to Manufacturers selling directly to consumers as it once again underlines the care that should be taken in managing the communication of contract terms and return procedures to consumers, and the handling of returning goods. A consumer could easily embarrass a brand owner who tries to impose too-tight return considerations.
Online retailers cannot reclaim some of the purchase price of goods even if they are returned after a long time and have given the user some benefit, an advocate general of the European Court of Justice (ECJ) has said.
Return period of seven days (plus three months…)
Buyers can return goods and get a full refund in the first one to two weeks of ownership of goods, said advocate general Verica Trstenjak. That right can last for months if the seller does not send the buyer the right paperwork correctly outlining a buyer’s right to withdraw from a contract. Retailers are barred from imposing charges and penalties on people returning goods.
“The only charge that may be made to the consumer because of the exercise of his right of withdrawal is the direct cost of returning the goods,” says Article 6 of the Distance Selling Directive. “For any distance contract the consumer shall have a period of at least seven working days in which to withdraw from the contract without penalty and without giving any reason,” says the Directive.
Even though the right of withdrawal need only last seven days under the Distance Selling Directive, but if the retailer does not inform the customer of the right properly then it lasts until seven days after that information is provided for up to three months. German law says that that right does not expire until the notice of the right of withdrawal is provided to the customer, which is why the German woman could still exercise it after eight months.
Trstenjak said that she recognised retailers’ concerns that some people might take advantage of the Directive’s protections, but that this was no excuse to erode everybody’s rights. “The fear of abuse by individuals may not generally result in the protection of rights guaranteed under Community law being restricted for everyone,” she said. “For that reason alone, a provision such as the one at issue cannot fall within the discretion of Member States.”
Source: OUT-LAW.com
Online sellers should carefully check terms and conditions of return on their site, and compare them to the Distant Selling Regulations. In the case of doubt, you should lean in favour of the consumer. An excellent guide is also available on the OUT-LAW site.
Net Promoter News: Hertz drives +26% in Europe
Hertz Global holdings reported a $1.21 Bn loss in Q4, and announced cost cutting measures, but still stay true to keeping Customer Service as key selling point. Hertz also announced Net Promoter Score increases, according to the Q4-08 earnings call transcript (source: SeekingAlpha).
CEO Mark Frissora reported: “…net promoters fueled growth… In our North American car rental business [...] the number of net promoters increased 3% over 2007 despite the workforce and fleet reductions. In Europe we improved our NPS by 26% in a very challenging operating environment.” Later on in the call he responded to a question: “…I just want to be clear we won’t compromise customer service and NPS (net promoter score system) for cost reduction. That is the one thing we make sure we don’t do. We don’t cut costs to hurt that score. That score of customer satisfaction we get on a daily basis by airport and by location.”
I couldn’t find latest NPS scores for Hertz, but I was able to locate a previous chart from June 2008 which details scores in US (NPS 52.3) and Europe (NPS 43.3), and the number of responses (70,0000 per month). I don’t want to be uncharitable to Mr Frissora, but without him naming what point in 2007 he took as his baseline the increase of NPS reported could vary widely (and it’s not clear if it’s by Points or a Percentage of 2007 scores, as they used last year). Let’s give him the benefit of doubt and say that the US is in mid 50s and Europe now approaching 50. (source: Form 8K for year end May 2008)
Main takeaway is Hertz commitment to keep measurement, and constant improvement of customer experience even in trying economic times.
Net Promoter News: Quark quotes NPS 50, Overstock in excess of 70, Verity NPS converts.
In a previous (business) life I was the Marketing Manager of Morse Computers, back in the ’80s and ’90s when its staple form of promotion was 4cm x 2 column ads in The Times, or 20cm x 2 col. ads on the back of The Independent and FT, running week-in, week out. We produced the ads on a Mac IIcx (with a 80Mb disk) running Quark Xpress, and typesetting on a Linotronic 200. Advanced stuff for the day. If you had a problem with Quark, you were largely on your own. No internet forums to turn to. And definitely no help from Quark, who epitomised the frontier spirit of early desktop publishing by providing basically zero support.
So it was with some nostalgia that I read that Quark have become focused on customer service. This from Planet Quark: Paul Brothe on Customer Service. Brothe took leadership of Quark’s customer service in February 2008. Since then, Quark’s customer-rated level of satisfaction regarding customer service has risen above Adobe’s, and higher than almost any other software company. Quark uses Net Promoter and asks customers about their experience immediately after a contact with the company. According to Brothe, Quark’s Net Promoter score has risen to above 50. (In a “two-for-one” he also reveals Adobe’s highest score was 46.)
Success secrets:
- Maximize self-service. Free Virtual Knowledge Base includes self-help (which is like phone help except via email)
- Live chat
- Direct email to a tech rep.
- Keep phone support free and fast.
- Calculate the 10 most common reasons that customers call in for support, and put the answers on the customer support pages at Quark.com.
- Key discovery: people actually prefer online chat for support, partly because of how easy it is to send links to Web pages and downloads, and because it’s easy for customers to send screen shots and other information about their questions.
Overstock report NPS of 73
OverStick.com report Net Promoter Score in their earnings call this week. Thanks to SeekingAlpha.
From Patrick Byrne – Chairman and CEO of Overstock (OSTK) says: “Slide 14 – Net promoter score. All time high of 73 [ ... ] we’re running at 73% now in the fourth quarter. The red line is the NPS of the people who call our customer service, meaning they have had some kind of problem. They ran at 27%, which is an all time high for the fourth quarter. So, even the people who have some kind of issue and call us gave us a much higher score as a company than the average American company receives, according to Professor Reichheld.”
Verity Builds Member Loyalty, uses Net Promoter
A report by Sarah Boehle, ManageSmarter.com on how Verity Credit Union in Seattle started to measure customer experience. Before: Subjective feedback only from “raving fans” and “not-so-raving fans”. After: Verity implemented a Member Loyalty Program in 2007 based on the Net Promoter Score (NPS).
Results: Significant improvement tied to the Member Loyalty Program. Loyalty ratings up more than 15 percent; member referrals +30 percent; new accounts increased more than 50 percent. Plus benefits of strategic alignment across corporation.
Key bullets from Verity Program:
- Aligned corporate culture. Streamlined bonus systems across company to just three elements, including credit union’s NPS. No “competing values” and ensures everyone working toward shared goals.
- Communication of program’s validity and importance. Organization-wide training on NPS, and quarterly meetings, where successful NPS initiatives and best practices are discussed in depth.
- Transparency: Online site where all staff can view the credit union’s most recent NPSs and compare them to organizational goals.
- Use customer feedback to target training.
- Get every department involved.
Full article here. (Verity Builds Member Loyalty)
Net Promoter News: SchoolDude chalks up 93, CoinStar collects 80
SchoolDude.com, a leading provider of educational facility software won Front-Line Customer Service Team of the Year in the third annual “Stevie Awards”. They must be doing something right: Joan Maddox, SchoolDude`s VP of client spoke of “98.6-percent client satisfaction rating and 93-percent Net Promoter Score ranking, which demonstrates our commitment to legendary service.”
No details on how score was calculated, but impressive nonetheless. Source Reuters etc.
CoinStar Inc report NPS in annual report; Score 80
Along with other companies now routinely reporting Net Promoter® Scores, Paul D. Davis, COO at coins-to-giftcards company CoinStar, pulled out NPS on their Q4 earning call: “Consumers tell us price point, ease of use, convenience, selection, the return anywhere option and online reservation feature guaranteeing in stock status. One of the more startling revelations as shown on chart 14 is Redbox net promoter score which is a major that asks, “Would you recommend this product or service to your friend?” Redbox’s net promoter score was a whopping 80% putting it in elite company with the likes of eBay, Apple, Amazon and others. A net promoter score of 60% is considered quite good, a net promoter score of 80% is outstanding.”
Nice stock uptick recently – coincidence? Or due to NPS? Transcript via SeekingAlpha
Net Promoter News in brief
Just a couple more snippets for today:
Companies Missing Big Opportunity to Turn Customer Pain Into Competitive Gain, Says CMO Council Report.
Synopsis: Chief Marketing Officers (CMO) Council self-flagellate over listening to Voice Of Customer. Majority don’t compensate staff on customer satisfaction or loyalty. Most don’t have programs to track word of mouth. Only a third thought they did well on handling customer complaints.
Among general hand-wringing only 38% said they gathered any feedback from customer engagement situations, and only 13% use real-time systems (pssst! Easy solution for you 87% who need to do this: CustomerGauge). Companies who did measure experience said it helped brands and business grow. Source: MSNBC.
Customers Invest in—and Promote—Charles Schwab
Charles Schwab CEO Walter Bettinger outlines the impact of the Net Promoter® Score in his organisation. 200 “exit interviews” with departing staff and customers in 2004 started their feedback culture. Key takeaways:
- 9 out of 10 Schwab employees speak to customers on a daily basis (it used to by 6 out of 10)
- All detractors are followed up within 24 hours of a survey.
- “Power of the follow-up” – shows the company cares
- NPS improved from -34 to +26 in 3½ years (an increase of around 1.4 points per month – my math)
Source: DestinationCRM
Fund Companies flunk Net Promoter Score test
In the current economic climate, it seems fund performance is no longer the main driver of mutual fund company loyalty. Cogent Research‘s newly released Investor Brandscape 2009 details the Net Promoter® Scores (NPS) for 38 leading mutual fund companies. Supporting Cogent’s earlier analysis, firms that receive the highest ratings from investors on perceived financial stability and product offerings also have the highest NPS. The overall average NPS for all mutual fund companies included in the study is -29, which means that, on average, mutual fund companies have more detractors than promoters. An 84-point spread exists among firms, ranging from Vanguard, which receives the highest positive score of +21, to Calamos which receives the lowest negative score of -63. The only mutual fund companies surveyed to achieve positive NPS scores were Vanguard, Fidelity Advisor Funds, and Fidelity Investments.
“It’s rather stunning to see that nine out of ten fund companies have more customers at risk of defecting than remaining loyal. In times like these, where positive investment performance is difficult, firms must provide or promote other offerings that address the existing mood of the market – thus, smaller or boutique firms with limited options will have a tough time maintaining loyalty due to lack of product or service breadth,” said Antonio Ferreira, Managing Director of Cogent’s Wealth Management Group.
Sources: Wise Marketer, BNET
Apple Tops Sat Survey, No One Surprised
As reported in The Register, Apple has the highest highest level of customer satisfaction among computer-buying consumers, according to a recent study (PDF) conducted by ChangeWave Research. Apple scored 81% “Very Satisfied”. Dell, HP, Lenovo languished around the 50% mark – or to put it another way, around 50% of their buyers were only “somewhat satisfied” or worse…
As the owner of multiple PCs and Macs, I completely relate to the scores, but it’s not for hardware reasons. Using a computer is more than the the box design or reliability – it’s the operating system and the software. And I suspect that I am not alone in having a poor experience with Vista that has caused this score. We have perfectly nice HP and Sony notebooks. Hardware design and build: excellent. Software: Not so great. Slow performance of Windows Vista and lost productivity. Overall user experience: Mediocre to lousy.
Compare this to my new MacBook Pro: Instant start up. Immediately finds WiFi. Search is a breeze. “Just works”. Overall experience: superb. I would be one of those voting “very satisfied”.
PC makers – I feel sympathy for you. If I was in your crew, I would seriously consider if the Windows platform is damaging the hardware brand. Better hope Windows 7 is as good as OS-X…
Four Bullets to Beat the Recession
At our recent Manufacturers D2C e-Commerce event at Schiphol, I shared a presentation with some of the group to help bring together ways of fighting a downturn in e-commerce sales – I called it “Four Recession-Busting Bullets“. We particularly focused on loyalty, repeat business and “Zero-Defections” of customers – as usual, measured by Net Promoter® Score.
Many of the ideas here were inspired from lots of sources – thanks to NewIncite, RightNow, TrendWatching, GetElastic, DuctTapeMarketing.
Of course, you are probably doing many of these, but feel free to use whatever you can to improve sales, and leave any comments to help others. Hope you enjoy it…
Or…
Download a PDF version here (5Mb): 4_recession_bullets – PDF
Microsoft coming to a High Street near you…
Much coverage this week of Microsoft starting its own retail stores. And plenty of brickbats for Microsoft for pursuing a “Me-Too!” Apple strategy.
However, I’d like to give Microsoft some kudos for deciding to open a consumer store. It’s a brave step because like many potential consumers I can’t really get excited about an MS store (compared to the Apple stores which are always fun to go in) – and I’m sure they are aware of this. For a manufacturer to start selling directly is a big thing (we call it Manufacturer D2C) – you can bet they endlessly discussed potential channel conflict, whether to staff it with MS employees or contractors, and what sort of “personality” will be on display.
Plus, it can only be *good* thing for MS to get some direct contact with consumers. You can’t hide away from criticism if you invite customers to buy from you. All it remains for them to do is to really listen to that voice of the customer, and then act on it.
Not many SKUs?
I counted less than 100 SKUs on the Microsoft Online Store so not too many space issues, I guess. Plenty of vacant retail property at the moment for Microsoft to occupy – old Woolworth stores perhaps?
Excellent commentary from Robert X. Cringley on how Microsoft is becoming WalMart-ed here.
… as Sony closes store
In a reverse step, Sony announced today that it would close it’s flagship PlayStation store in downtown San Francisco. With a slightly mixed message, Sony spokeswoman Liz Archibald said “…we felt it best not to continue with a dedicated PlayStation Store at the Metreon at this time, …[but]… We are actively looking at other opportunities to offer PlayStation products through direct retail channels.”
Sony is also closing a Style store devoted to its products in the Metreon – so could this mean a global ramp-up of SonyStyle online stores?
