They say that fashions come around again roughly every thirty years. I can hardly believe it, but it has been that many years since the great Poet of Upminster Ian Dury released “Reasons to be Cheerful” in 1979. In its 4’43″ length, Dury checks an eccentric laundry list of what makes him happy:
Some of Buddy Holly, the working folly
Good Golly Miss Molly and boats
Hammersmith Palais, the Bolshoi Ballet
Jump back in the alley, and nanny goats
Dury’s sunny outlook is appropriate for the times we’re living in now, and I was struck by its positive tone when I started work last week on a new CustomerGauge client project to measure their Net Promoter Score.
Let me explain. Most of our projects involve analysis of customer feedback with the aim of understanding what an organisation should do to improve. We help businesses listen to the “Voice of the Customer” by categorising and “tagging” comments. Analysing the results show which areas should be improved, in order of priority.
Post-Sales Customer Service comes up a lot. Especially “You promised to return my call…”
Something Nice to Study
Acting on what customer Detractors are telling organisations to improve is at the heart of the Net Promoter Score system. CustomerGauge helps our clients by presenting useful charts and tables, plus other analytic tools to understand impact. Managers can find negative feedback quite distressing – and may ignore it Ostrich-like, or rush to fix trivial (but noisy) issues.
But often the simple approach is best. A simple bar chart of top issues. A print out of customer comments.
And rather than just focusing on the negatives, CustomerGauge can help understand the positives too. What customers like about the experience is just as valuable too. By understanding the areas of the business that customers like can be surprising. I’ve found that Marketing people can suffer from Attention Deficit Disorder, and forget that their messages take a while to be generally adopted by customers – they have moved on, while customers are just catching up. Around half of the customer comments in our clients are strongly positive.
Even in one of our worst performing clients, some customers still loved their products.
And flagging positive experiences has a doubly useful effect if the good news is delivered to front line teams. Often we find that customers will pick out and congratulate staff members by name. Delivering this sentiment can be a real morale booster.
A Bit of “Come and Share It”…
Display it on a plasma screen for all to see. Print out and pin up a selection on the notice board. Add them to your website. That’s the “CG” part. CustomerGauge can do all that for you.
Whether or not you use CustomerGauge, my tip is to channel Ian Dury. Find your organisation’s positive feedback and share your customers “Reasons to be Cheerful”.
Ian Dury, 1942 – 2000
Australian Banks seem to have caught Net Promoter Score fever, judging by the number of them that report on NPS, with admirable transparency. Please keep it up!
WestPac Annual Rep NPS-er
Today we have results from Westpac – Australia’s largest bank, ranked 15 in the the world. They state in earnings release: “NPS is a measure of franchise strength and the propensity of customers to recommend the bank.” Numbers: Westpac RBB’s Consumer NPS improved to -17.6; improving faster than peer average. Westpac RBB’s Business NPS improved to -21.7 closing gap on peers, St.George Consumer NPS improved to -5.1, improving well ahead of major bank peers and closing the gap to Regionals from 27bps (basis points) to 15bps. Source: Age
Hats off to Westpac for being proud of a negative NPS, but they are the best of a bad lot, and credit for improving - see “Oz Banks Ranks” – our previous coverage of Australian Banks.
Arxis go NPS
From a self-puffer: “Arxis Technology Honored with Customer Excellence Award Award Granted by Sage in Recognition of “Exceptional Customer Service”. Won Sage 2008 Customer Excellence Award for Net Promoter Score (NPS) that is more than double the industry average. We say: Too vague – tell us details please, if any PR folk reading. Source: Horse’s Mouth
FixYa Gets Ya Net Promoter
User-feedbacker FixYa reckons it can stand out from crowd with a product-specific and user-generated Net Promoter Score. The end game, explains CEO Yaniv Bensadon,”is to establish a type of Net Promoter Score for products and their manufacturers.” And “As much as there are different review sites out there, none are offering product-specific assistance on demand,” added Bensadon. Sources: Self-Puffer and TechCrunch
EG up by an “Enormous Number”
More proof that PR people struggle with math*… According to news item: “EmploymentGroup Customer Satisfaction Outpaces Industry Average by More Than 400 Percent”. Out-staffer EmploymentGroup (EG) announced 2009 Net Promoter Score is 52, exceeding the U.S. staffing industry’s average by more than four times. Also EG’s Managed Services division (mail/ship/gardening) aced a 67 in its first year of tracking Net Promoter Score. Source: TalentManagement
*You can’t mix points, percent, NPS!
KPN Wire Up for NPS
News on how the former-state-monopoly Dutch Telco KPN aims to become consumer friendly using Net Promoter Score (in Dutch, but the gist handily translated for you…). Programs Manager Henriëtte Bakker Selz says they are moving to a single CRM system in place of 14 customer registration system. There will be a top-down and bottom-up approach: Strategic survey with multiple questions and a short operational survey after each operational touchpoint, using an automated system. Source: KPN wil met NPS dienstverlening verbeteren, ManagersOnlineNL
Lawson imps’ NPS
ERP-Softer Lawson will implement its “Net Promoter Project” from June according to Peter Quinn, Chief Customer Officer. reporting. Company hopes that NPS may show customers that “Lawson cares what they think” – useful in competing with SAP and Oracle which have bad reputations for being aloof to all but their biggest customers. According to article, negative customer feedback will help Lawson understand where to improve. It may prove scary for the salespeople at Lawson (already under Pink Slip or P45 pressure), as the project will weed out the Lawson salespeople who excel at the service aspect of their jobs, and which ones are dragging the company down.
Source: IT Jungle
Clearswift clear about NPS.
According to a PR-puffer on its earnings release, UK security co Clearswift announces it is the first security company to embrace the Net Promoter Score. “The continuous brand monitoring by online feedback enables Clearswift to focus business efforts on delivering value to customers more efficiently and effectively.”
Source: Earnings Release
SW Partnership based on NPS?
In a Q&A on why NPS poster-boys Southwest Air have teamed up with Mexican-bound Volaris Air, one the reasons listed is “…like Southwest, they have earned exceptionally high marks for their Customer Service through commonly used Net Promoter Score… All of these factors make Volaris a good fit for Southwest.”. Interesting to see NPS explicitly mentioned in terms of Company Culture Compatibility (that’s CCC – your new TLA for today). Source: NutsAboutSouthwest
Overstock Over 30′s
From internet-excess-mover, Overstock.com Inc. Q1 2009 Earnings Call Transcript: Net Promoter Score is 31, “an all-time high”. From Earnings review, Seeking Alpha
Scanner reads in 35%
Small survey results on what Customers Think of Microvision’s ROV Barcode Scanner: 25% response, Microvision and products received a +35% Net Promoter Score (NPS), service department received a +30% NPS.
INetU host NPS 58
In a recent PR-Puffer, managed-hoster INetU announces results of fifth annual customer service survey with 97% Customer Satisfaction, and Net Promoter Score of 58. (Nice, but then they go on to make an unproven claim that it’s “nearly 50% higher than recognized industry leaders.” 50 points? 50 percent? Accurate reporting please!). They have been sending annual satisfaction surveys since 2005, and helpfully offer that 2009 survey results are based on a 25% response rate. Source: the wires
Sometimes companies report both Customer Satisfaction Scores and Net Promoter Scores, and you might notice from the INetU news that there seems to be hardly a correlation between Customer Satisfaction Score, and NPS. In their case, Customer Sat is 95%, and NPS is “only” 58 (which actually is nothing to be ashamed). Why the gap?
I conclude that customers might unthinkingly report that they are satisfied, but only a smaller number actually internalise the question and go on to recommend the company to others. This, by the way, is the basis of the strength of the Net Promoter Score. Unless your NPS is near 100, you have some customers who are not passionate promoters. If you stick to customer satisfaction as a barometer, and get above 90, you would understandably be feeling quite pleased. But a look at the NPS will dispel the hubris, and force you to work on improvements.
Quis custodiet ipsos custodes? For those who missed out on a formal education, memorise and learn this latin quote, which can be translated as “Who Watches the Watchmen?” (that includes you, CIA). I choose to modify this expression to mean “Who Surveys The Surveyors?”, and I move for a standardised reporting of the Net Promoter Score®.
In the last 3 months I’ve reported around 100 company Net Promoter Scores. I’m delighted that companies are choosing to reveal the scores, especially in Earnings Calls. But unlike GAAP audited accounting figures I am never sure if the figures are meaningful or can be trusted. I am certain that intentions are good, but also certain that some companies are reporting on small sample sizes or with non-standard questions.
I call on you, the nascent Net Promoter Industry, to agree on a standard for reporting, so we can benchmark companies further. My suggestions are:
- Minimum sample size: Let’s say n=100 as good place to start. If you can’t get to 100, please list the “n” used.
- Sampling: You have a minimum response from survey: 20% is a good start. If you claim an “relationship” NPS for the company, that means you should have something like 20% of your customers responding. For “transactional” NPS on touchpoints, same applies.
- Standardised Likert scale: Fred’s book says 0 – 10. Nothing else please.
- Standard Question: Question must include be “Would you recommend…”
- No-gaming: Take sensible steps to ensure that survey-fraud has not taken place
- Auditing: Self-certification should be enough, but you should be ready for peer review of results to ensure an outside perspective.
- Designation: So the industry knows when a result meets above criteria, I suggest a small designation. My first idea was NPS100 (meaning n=100) but I think too restrictive. My new suggestion: NPS-a – meaning “Net Promoter Score – Audited”
The more discipline on reporting the better for all concerned. If Net Promoter Score is to become a gold-standard for investing, let’s make sure we can all do a better job to enable comparison.
I welcome your comments.