Net Promoter News: Customer Delight is the New Bottom Line, plus YouTube, Bingo and Lawncare

 

“…for now, the net promoter score is the best measure available for determining client delight”

A couple of relevant articles caught our eyes this week.

Steve Denning in the Forbes article “Measuring Business’s New Bottom Line: Customer Delight” neatly summarises  the Net Promoter® Score methodology. “To measure customer delight at the organizational level, the best place to start is the work of Fred Reichheld. [...] Initially he had trouble getting firms to take loyalty seriously or to do anything about measuring or tracking it [...] So he set out to create an instrument so simple that people could easily understand how it tracked the quality of their client relationships“. In a balanced way, Denning describes the growth of Net Promoter, and closes with “Reichheld himself is careful not to overstate the reliability or validity of the method. It’s not intended as a tool for academic study, he notes, and it doesn’t work in some settings [...] Nevertheless, it is practical and intuitive, and, most important, it drives rapid learning and action across the organization [...] for now, the net promoter score is the best measure available for determining client delight.“

On the VentureBeat Entrpreneur column, Clate Mask (of Conquer the Chaos fame) counts up 3 ways to avoid costly customers. News-At-Ten-headlines:  1. Get totally clear on who the target customer is, 2. Put metrics in place to measure the cost of a customer. 3. Re-negotiate with or terminate costly customers. Back up to bullet 2) and he suggests: “A few key metrics can help you steer clear of this trap. These will vary, depending on the type of business you run, but a few common examples are cost of goods sold, lifetime customer value and net promoter score.”

Company/Segment News

Social Media: Netpop Research publish Net Promoter Scores for social network sites in US, and find that YouTube users are more likely to recommend than FaceBook and Twitter. Scores include YouTube 50, Facebook 36, Groupon 33, LinkedIn 30, Craigslist 29 with Twitter at 11. Source: MarketingProfs

Finance:

Canada’s BMO Financial Group shout out their NPS and Profit  in their Q1 results: “We continue to focus on the customer experience, as reflected in our high loyalty scores. Our retail net promoter score was 41 for the first quarter of 2011 and 40 in the prior quarter, and remains very strong compared to the scores of our major competitors.”. Profits up too: Net Income Increased 18% to $776 Million. Source

Military’s own USAA topped NPS tables for third year, coming  first in consumer banking, personal auto insurance and homeowners/renters insurance categories in Satmetrix 2011 Net Promoter Benchmark Study. Texas based USAA led in all three industry sectors by squarebashing Net Promoter Scores of 87 in consumer banking; 78  in homeowners/renters insurance; and 73  in auto insurance.From San Antonio Business Journal. [Net Promoter insiders should check out the USAA testimonial page, which is beautifully executed and kept up to date with new tributes daily.]

Card-Not-Present e-commerce processers Litle and Co win 2011 Stevie Award for Litle Vault. PR reads “The company’s customer-obsessed culture is committed to Voice of the Customer initiatives, including Net Promoter Score (NPS)” More.

Staffing Specialists: In a slew of self-puffers covering Net Promoter scoring in Inavero’s 2011 Best of Staffing/CareerBuilder one stood out with a number. Hudson, who “secured their place on the winner list by obtaining at least a 55% Net Promoter Score for extraordinarily high levels of client satisfaction. This score is nearly double the national staffing industry’s Net Promoter Score benchmark…” Source.

Gaming: British bingo-to-roulette gamblingistas Rank Group touted financials for 2010 showing increase in revenues to £567.8m, and mentioned NPS in refreshinghly honest way. “Revenue accelerated strongly and operating margin expanded [...] Net promoter score declined significantly, principally as a result of customer dissatisfaction with our online casino and sportsbetting sites.” Not clear if they are fixing the NPS score, or if mug punters do not recommend losing money to friends or family. iGaming

International: Genroe and Directness announce partnership to bring continuous Net Promoter Score measuring system CustomerGauge to Australia, calling out early success with insurer iSelect. More

Small Business: We like to see heartwarming stories from smaller companies having success with Net Promoter. This from Lawn and Landscape News , and covers Brad Johnson, owner of LawnAmerica in Tulsa, Okla., talking about on how companies can measure their customer satisfaction. “True growth in any industry is hard to find,” Johnson said. “We’re geared for not just pleasing customers, but exceeding their expectations. They’ll talk about us if we’re really, really bad or really, really good. … That determines your future growth: how happy your customers are. I’m a numbers guy. I like to see data. The Net Promoter Score is a number I can look at, and I can be confident of how we’re doing on customer service.”

From a Net Promoter perspective Johnson does the right thing: incentivizing his entire company on the NPS results; depending on their position, managers can receive as much as $3,500 more at the end of the year if they exceed their goals. Technicians and office staff earn bonuses based on the performance of the company as a whole. “We post all of our data. There’s some peer pressure, because it’s very visible,” he said, and added “It seems to be working: In 2010, retention went up, turnover went down and employees’ attitudes were better”.

Net Promoter News: No alarm for SF Fire at 79, Ambassador spoils us at 70, Bank Montreal trouve 39. Steamboat chairlifts 82

Net Promoter News 9 June 2010

San Francisco Fire Credit Union hits 79

Grow your Net Promoter Score, reports the CreditUnions.com,  and see an increase in new business. According to the informative article “The Successful Near $0 External Marketing Budget” San Francisco Fire have have tracked Net Promoter Score since 2004, and now bases all staff incentives on the score. With “…focus on the member [the SF Fire] creates word of mouth,” says CEO Diana Dykstra. A useful table shows the link between rising Net Promoter Score and gross new member growth. In 2009, NPS climbed to 79, with new members rising to 14%. And with not a dime unwisely spent on marketing.

 

 

 

 

Wall Street News – NPS in the K10s

Ambassadors Group (NASDAQ: EPAX) Q1 2010 Earnings Call

Peg Thomas, President of student-tripster Ambassadors Group confirmed on the Q1 2010 call “our Net Promoter scores today are at 70%, in comparison to a score of 62% at the end of 2009. Source: Seeking Alpha

Intuit (INTU) Q3 2010 Earnings Call May 20, 2010

Bookkeeping softer Intuit won’t go into NPS details, but on the Q3-2010 earnings call Brad Smith, CEO shows confidence that analysts know about NPS:  “…continued improvement in our product and our continued execution in terms of our online marketing capabilities are showing up in terms of improved net promoter scores. And as you know, net promoter scores are a pretty good indication of which way retention is going to go.” CFO Williams added “Revenue per customer exceeded last year’s level, driven by fewer promotional discounts on QuickBooks and a better product experience as indicated by improved net promoter scores.” SeekingAlpha

SAVVIS (SVVS) – Q1 2010 Earnings Call

CEO James Ousley of server polishers Savvis pulls out NPS (but no numbers): “we continue to see the results of our efforts in client care outreach. This is reflected in our improving Net Promoter Score rankings.” Freiberg adds “[With Net Promoter] you’re reducing your churn, you’re increasing the stickiness of what you have and the ability to put more than one product into a customer, really for us, drives better margins because a lot of the value-added services may not necessarily take additional square-feet space in a data center.” SeekingAlpha

Franklin Covey, Co. (FC) F2Q10 Earnings Call

Robert Whitman of trainola Franklin Covey was proud of “very high net promoter score from our customers in the customer loyalty practice” (although that is the one place you would expect to find a high NPS – Ed). SeekingAlpha

BMO Financial Group / Bank of Montreal Q2 2010

Reported in the Canadian BMO FinGroup earnings press release: “Our continued focus on the customer experience is reflected in our high loyalty scores. Our retail net promoter score was 39 for the second quarter of 2010, compared with 40 in the first quarter. Our retail net promoter score remains very strong compared to the scores of our major competitors.” MarketWire

 

Net Promoter in the News

QVC with NPS Asker

Gina Deeble from UK home shoppery QVC discussed NPS at Gartner CRM Summit UK stating “75 percent of QVC’s customers would recommend” with around 100,000 reviews a year.  Using NPS and reviews  helped QVC find issues they would not have known about – product examples include an ice cream maker that initially sold well,  but, in fact, the product was so bad “it was hurting QVC’s brand reputation,” so quickly discontinued selling the product, and canceled future orders. Some good tips on how QVC communicated to customers, and worth registering to read. 1to1Media

In brief

Thank you Quantix, a UK based server polisher for telling us you “have been given” Net Promoter of 34″ which is “miles ahead of industry standards”. Congratulations, but some more detail would have been helpful. Self Puff, RemedialMathPR

SatMetrix phones it in with Hoffman: From Tom Hoffman’s blog – Deborah Eastman, Chief Marketing Officer at Satmetrix, discusses how NPS has evolved and how companies are applying it to improve the customer experience (podcast) – 1to1media

IMD, leading executive teachery and MBAmonger adopts NPS: Jim Pulcrano, IMD executive director says “We still need to make more effort in our post-programme work with participants and companies, [...] and [with] all of our improvements efforts, I believe our efforts with NPS (Net Promoter Scores) will help us immensely.” GenevaLunch

Fast Company: NPS is a silver bullet: “There’s really only one way–to get as close to the paying customer as humanly possible. If there’s a silver bullet, it’s the Net Promoter Score–a research metric, but a breathtakingly intuitive one.” FastCompany

NPS helps career prospects: Seen on the job boards – Better World Books, the “online bookstore with a soul,” is seeking a Chief Operating Officer to help us change the world through a new form of capitalism focused on people, planet and profit. [...] Actual experience of driving and implementing a NPS (Net Promoter Score) culture a real plus.” Send in your CVs here.

Steamboat Ski area surveyed 3,000 skiers to gauge net promoter score of 82 percent. The spokesmen said Steamboat had a Net Promoter score of 80 percent in 2008-09 and 79 percent in 2007-08. Source: SteamboatPilot

And finally, Portland Development Corporation undertook a Net Promoter asker among the city’s tech community, which prompted the headline of the year: “PDC survey suggests software developers like Portland, but there’s room for improvement”. But not all the askees were happy, not least with the methodology: “they asked multiple choice questions which potentially had answers other than the options presented on the list, which caused me to answer questions in a false manner” complained one. The PDC boss summed up the result rather glumly: “We may have to take a bit more of a hands-off approach”. OregonLive