Net Promoter Score: the “Wow Signal” for Business
Thirty-two years ago this week, the UK was coming to the end of a summer that featured the Queen’s Silver Jubilee, the anti-establishment version of “God Save the Queen” by the Pistols and a new film called “Star Wars”. In Ohio, a volunteer observer at a radio telescope was looking through print-outs of antenna data, and was so excited by what he saw that he wrote “Wow!” on the margins.
What Dr Jerry R. Ehman had found is debated to this day. The ‘Wow! Signal was a startlingly strong signal detected on August 15, 1977 by the SETI project at The Big Ear radio telescope of Ohio State University. The signal bore expected hallmarks of potential non-terrestrial and non-solar system origin. It lasted for 72 seconds, the full duration Big Ear observed it, but has not been detected again. Amazed at how closely the signal matched the expected signature of an interstellar signal in the antenna used, Ehman circled the signal on the computer printout and wrote the comment “Wow!” on its side. This comment became the name of the signal, and has been featured in popular culture since (“X-Files” etc).
SETI (Search for Extra-Terrestrial Intelligence) projects use scientific methods to Search for Extra-Terrestrial Intelligence. Various techniques are used, but all scan parts of the sky consistently in a measured way, then carefully analyse the results to look for data that stands out from the background noise.
Companies with Net Promoter Score® programs are doing a similar observation activity, but on their customer base. By using a slim survey of just a few questions, they consistently measure their universe of customer loyalty (either on individual transactions, or on customer relationships) and analyse the 0-10 score and Voice of Customer to understand how to improve customer services. Sometimes the results can have a similar “Wow!” effect that Jerry Ehman found.
To illustrate, I have two (real, but disguised) examples here from our software CustomerGauge that helps companies measure Net Promoter Score.
The first shows how doing some simple segment analysis can throw out some interesting data. In this case the data is segmented by salesperson. Although the number of responses is a little small, it was obvious from the high score and positive customer comments that one of the salespeople was doing something special. These customers were incredibly positive about how they had been dealt with, and the score reflected that. By analysing the customer feedback (sometimes called “verbatims”), the Net Promoter Score team found that this salesperson had developed her own quoting tool that allowed her to respond quickly to customer requests. This “Wow!” factor was making the difference, and the quoting tool was adopted by the company as a best practice. In the next survey the customers showed their appreciation.
The second example shows Net Promoter Score responses each week to a particular customer service team. Scores were consistently around the “10”, and were getting worse. But at some stage, the scores jumped up, and then rose to a new plateau at around the 30 mark. After looking at the background, our client found what happened: The department manager had resigned, and scores were tailing off. It appeared that morale and leadership were low. The upward spike in scores was due to a new manager coming in, and setting new standards for service and customer interactions, which immediately had a positive (and lasting) impact. Same team, different leadership style – but significant improvement in loyalty. The new manager was also a fan of Net Promoter, and used customer feedback to reinforce good behaviour. Result for company? Widespread adoption of this persons techniques, and using Net Promoter in other service teams with CustomerGauge measurement.
Using the Net Promoter Score is not always about finding the “Wow!” signal. It can be most useful to show a consistent improvement over time. But cultural adoption of a new metric can take a while – and flagging examples of small but significant activities can be used to impact a large organisation. Unlike installing a radio telescope to search through galaxies, starting a Net Promoter Score program with CustomerGauge is not expensive, and you can be up and running with your own program within two weeks. Call it “SECI” if you like: Search for Extra-Customer Intelligence, and start to hunt for your own “Wow!” signal.
Net Promoter News: SAP at 60, SkiButlers serve up 89, 50 for Oz iiNet, SA beats Germany in World Cup
(From News Team: We have a new format for enGaugement news – hope you like it…)
Enterprise softer SAP’s Senior Veep of Community Mark Yolton mentioned Net Promoter Score in interview recently. Commenting on the value that his 1.7 million community members gained he said: “We ask for feedback about quality – and that feedback says community members get extremely high quality answers. Our Net Promoter score is in the 60% range.” Rubbing it in for other community leader he rather mischievously added “A good score would be in 30-35% range.” Found on SocialMedia
Oz Telco Minnow at 50: Australia’s 3rd largest ISP iiNet (which recently launched Naked DSL) are NPS converts. Brisbane Times writes: “… it is an obsession with customer satisfaction that is iiNet’s most telling differentiator. The company’s executive team starts each day with a review of the latest customer feedback and Net Promoter Score data [...] (CEO) Malone has almost half his bonus riding on the Net Promoter Score. Recent company filings show the Net Promoter Score is somewhere between 40 and 50, putting iiNet in the same bracket as brands such as BMW and Apple”. Having half your bonus on customer satisfaction is a real (Naked) balls on the line approach… Source: BrisbaneTimes.
Ski Butlers get an 89: In-room Ski/Board renter Ski Butlers averaged a Net Promoter Score (NPS) of 89% for the 2008-2009 ski season according to news site. “This score tells us two things,” said Bryn Carey, President and Founder of Ski Butlers. “One that we have consistent service throughout the 25 North American resorts we serve and two we have found a way to make ski and snowboard rentals convenient and hassle-free. This is not only good for Ski Butlers but also the industry as whole.” Source: VisitVail
Early World Cup Scoreline: SA 96, Germany 88
Brand advocacy egghead Dr Nikolaus Eberl delights South African business owners with latest brand advocacy survey conducted this year (reported by the optimistically named “ComeToCapeTown.com” site) – visitors to South Africa for the FIFA Confederations Cup, gave a score of 96*, while after the last World Cup in 2006 Germany scored an NPS of 88%. All this to promote early tourist bookings for the 2010 FIFA WorldCup. Let’s hope the stadia are finished in time. Sources: CometoCapeTown and eTurbo.
Net Promoter News Snippets…
Webjets announce NPS program, staff rewards ahoy… ONLINE retailer Webjet announces 15% increase in net profit this year. Key to success in a down travel market? According to TravelTrends, it could be due to “substantial investment in quality initiatives and customer guarantees including the development of a net promoter score system, with associated technology and incentive arrangements, where all staff are measured and rewarded according to a sophisticated quality index.” Source: TravelTrends
87 to Life… Self-puffer from Minnesota Life: Minnesota Life Insurance Co. top ten US group life insurers claims “Respondents to customer surveys are 100 percent satisfied with the service they receive from Minnesota Life group insurance, giving the company the exceptional Net Promoter(R) Score of 87 percent.” Source: Self-Puff.
CoinStar Stick At 80: As reported here back in Feb, money-to-DVD-vendingster CoinStar reported NPS at 80. Don’t get too excited, but in Q2 Earnings they report NPS again as 80. At least they are consistent – both with NPS and income growth. Source: Seeking Alpha:
Travel Sector arriving late at 5: eDigitalResearch published a benchmark of customer loyalty in the UK online travel sector. Using a “net promoter score” to find which sites are most likely to be recommended through word of mouth, the study found the online travel sector as a whole achieved score of +5. For comparison purposes retail scored +27,finance +18, car manufacturing +7. Editors note: Looks like this based only on website experience, not purchase or travel experience, so be careful in benchmarking. Source: eDigital Presentation.
Bridgeway say 70% score a 10, but mislead on score… Legal softer Bridgeway claim in a self-puffer that 70% of clients give them highest Net Promoter Rating. In the press release, they say “Bridgeway measures customer feedback rigorously using the Net Promoter benchmark”. The release gives impression that they have a world-class score of 70. All it’s saying is that 70% of clients scored a 10. It could also mean that it has NPS down to 40% (if 30% of clients scored 6 or less…). For a company in the legal space, you would expect some more diligence – we’d like to know the truth! Source: Self-puffer
