Net Promoter News: Private tops NHS in UK, LawnAmerica cuts competitors’ grass, Banks v Credit Unions: 67 point gap, Vanguard +70, H&R Block up 5
Private franchise blows NHS competitors out of the water
Much ado has been made of the UK Government’s initiative to use Net Promoter (rebranded as the “Friends and Family” test) to measure customer advocacy in the National Health Service. After many weeks of commentary (not to mention punditry), NHS Midlands and East is the first region to publish results.
The most interesting finding for our UK friends was that the joint “winner” in terms of scores is Hinchingbrooke Health Care Trust, which is not a publicly managed facility – it has been run by private provider healthcare provider Circle since February. According to the HSJ: “Circle won a £1bn 10-year contract to run Hinchingbrooke in November, making it the first ever non-state provider to deliver a full range of NHS district general hospital services when the contract began earlier this year. Patient safety, patient experience, staff engagement and value for money were set out by Circle as its four priorities…”
Is this a case of private enterprise offering a demonstrably and measurably better level of care, or are there flaws in the method? Stay tuned as we keep an eye out for more on the topic in coming weeks. Health Service Journal (subscription)
LawnAmerica cuts competitors’ grass
Many businesses incentivize employees, but few do it with the zeal and dedication of LawnAmerica. An article in industry publication Lawn & Landscape claims the company has 15 performance categories for its route managers alone – each one with a customized performance spreadsheet.
Besides this, the company tracks everything from production goals to cancellation rates, with one important metric being Net Promoter – for which the business scores in the high +70s.
The measurements are backed up with robust incentives. Besides a number of short-term bonuses, 25 per cent of annual profits are placed into a pool and shared with employees based on their yearly pay, which means that employees that perform better during the year also stand to gain more at the end of the year. All in all, bonuses can account for an eye-popping 40 per cent of employees’ salaries.
This system has paid outstanding dividends all the way to the bottom line – LawnAmerica has grown every year since it was founded in 199 – even through the last recession – and is on track for 18% sales growth year on year in 2012. To pile glory upon glory, the company boasts impressive employee and customer retention rates. Imperfections? You’ll have to read the full article, but we have to agree the downside is limited. Lawn and Landscape
Banks “stunningly low”, but credit unions still have work to do
Banks in the Northwest of the US received some chilling news this weekend – according to a survey of 867 respondents commissioned by the Northwest Credit Union Association (NWCUA), their collective Net Promoter Score was -17. (It should be noted that the survey included 477 credit union members and 390 non-members – kudos to the NWCUA for being so transparent with this information.)
In stark contrast, credit unions scored a significantly stronger +49.6.
The yawning chasm between the two may suggest to punters that bank customers are all but falling over themselves in their mad dash to the superior service and customer care offered by credit unions. However, this is not the case. According to Dr. Neil Goldman, who was responsible for the research, “You can be completely disloyal and still be satisfied.”
He believes that despite the gap, credit unions have to do more to differentiate their service and product offerings in order to reach their growth potential. Northwest Credit Union Association
Vanguard marketer fights for pennies
In an era when financial services firms are in the news for all the wrong reasons (see the banks above), investment-management firm Vanguard differentiates itself by operating all of its funds at cost. In practice this means that all outgoings are constantly under the microscope, and for head of retail advertising and prospect marketing Michael Ma, it means he has a responsibility to show that advertising lowers rather than increases expenses.
In terms of advocacy at least, this strategy appears to be driving strong results – for current investors, the firm has Net Promoter Scores in the +70s. AdAge
Travel Counsellors launches “TC score”
Customer advocacy rock stars Travel Counsellors, generally accepted as owner of some of the highest Net Promoter Scores on the planet, have launched a program based on Net Promoter to monitor client loyalty among corporate travel clients that they call “TC Score”.
Managing Director Steve Byrne comments; “By increasing the scope of our TC Score scheme to cover business travel our agents can quantify the nature of their client relationships, plus used as a marketing tool the results can help to demonstrate the value of their travel service to new and existing clients.” E Travel Blackboard
H&R Block announces earnings and improved NPS
Tax specialists H&R Block briefly mentioned an improvement in its Net Promoter Score in its Q4 2012 Earnings Call. “Our Net Promoter Score grew more than 500 basis points, and that this year’s marketing investment drove an 11 point increase in the awareness of our digital products…” said CEO William C. Cobb. Non-financiers may want to know that 500 basis points is what most people call “5 percent”. Seeking Alpha
“It’s all about the Why…”
CustomerGauge heroine Jackie Huba talks Net Promoter sense in this video clip on Dell’s Official Flickr Page. If you have not read her book “Creating Customer Evangelists” we can definitely recommend it… : Flickr
Net Promoter News: Scottrade Invests in Loyalty, Reaps Windfall, Kohl’s and Macy’s are NPS Catwalk Queens; Walmart a Fashion Disaster, Dell makes Inspired Acquisition, Execs *Heart* Net Promoter
Scottrade profits from high customer service returns
Scottrade has announced to the world that it scored the highest in customer loyalty in the brokerage and investment category in the recent US Net Promoter Benchmark Study by Satmetrix.
This strong performance is definitely unusual for financial services brand, considering the robust criticisms and headwinds the sector has faced in the last few years.
And perhaps even more impressive, the self-puffer claims not only that the company’s growth from its beginning in 1980 has been entirely organic, but that it has never closed an office or had to lay off an associate. Bearing in mind recent crises and obstacles this would be a great achievement for a company with 50 branch offices. But for a company with over 500 branch offices such as Scottrade, I think we can safely call it exceptional.
Women’s clothing: Kohl’s and Macy’s are the new black, Walmart the uninspiring beige
New Net Promoter research by BigInsight that analyzed the top five US retailers for Women’s Clothing (Kohl’s, Walmart, Macy’s, JC Penney, Target) throws up some interesting insights:
- Of the five, the most heavily advocated brands by a long shot are Kohl’s, Macy’s and JC Penney, all of which are department stores (as opposed to the discount options of Target and Walmart).
- For Kohl’s and JC Penney, price and selection were the key reasons that drive shoppers to make their purchases, but for Macy’s, it was quality and selection.
- Walmart was the only retailer of the five to calculate a negative score (-10.3).
There are several takeaway here for clothing retailers. But for shoppers there’s only one: If you want to pleasantly surprise your female friends and loved ones, visit discount retailers at your peril. The BIG Consumer Blog
Dell acquires AppAssure, based in part on Net Promoter Score
Dell has announced that it is acquiring software firm AppAssure, which it says will become the company’s primary backup offering targeted at small to medium-sized businesses.
According to Brett Roscoe, general manager and of data management solutions at Dell Storage, the key factors in the decision-making process were that it was going through a huge growth phase, and that this was complemented by Net Promoter Scores that were “off the charts.”
We’re always interested to read about high Net Promoter Scores that correlate with business growth, and it will be interesting to check in on this acquisition in a year or so to see if the momentum has continued. In the meantime, this appears to be an inspired move by Dell. ARN
Austin Benn outperforms in advocacy, falls short in transparency
This week UK recruitment solutions firm Austin Benn trumpeted a Net Promoter Score of +72 on its website, and says its nearest competitor comes in at +56.
While both of these scores are exceptionally strong, details on the site are pretty light. In the interests of transparency, we’d love to know more details on who did the work and sample size. The usual basics. (Plus, a small #fail. They tell us “*Net Promoter methodology based around customers scoring given factors on a scale of 1 to 10″ – should have used standardised 0 – 10 for accurate results).
Austin Benn – if you’re reading this please feel free to add this to your NPS CV, and re-apply for the top Net Promoter spot! Austin Benn
A third of execs claim to use Net Promoter
According to Acxiom and Loyalty 360, Net Promoter is one of the most popular metrics used by CXOs as part of their customer retention strategies. So popular, in fact, that approximately one third of those surveyed claiming they use it – a big number indeed and somewhat higher than we may have estimated.
Perhaps in a related matter, less than half agree that they know who their most loyal customers are. Marketing Charts
In Brief: Other Net Promoter news this week
- CustomerGauge’s Australian partner Genroe discusses the three critical elements of Customer Loyalty surveys
- The Motley Fool sings the praises of Net Promoter-using cloud computing specialists Rackspace
- Costco claims highest Net Promoter Score among major department, wholesale and specialty retailers in recent survey by Satmetrix
- CustomerGauge followed up the “Monday Effect” news in last weeks Net Promoter News by looking at some data in They Don’t Like Mondays. Or Do They?
Net Promoter News: Marketers, Metro Bank ‘get it’ but Barclays don’t, plus Smartphones, Ireland and Clockwork Home
In what is a kind of Net Promoter ‘Love-fest’, the UK’s Marketing Week devotes many column inches in their latest issue to NPS. In “How to get more from your score” they explain how “adding extra layers to the Net Promoter score technique of assessing levels of customer satisfaction is enabling marketers to take their insight into the boardroom.” They add “…there is no doubt NPS has proved useful for marketers. Mark Blayney Stuart, head of research at the Chartered Institute of Marketing (CIM), believes the use of NPS continues to increase because the system is so straightforward and easy to use.” Article name checks companies: Hays Recruitment, Standard Life, Aviva, Carole Nash and Philips.
And continuing in the same issue Mark Ritson writes “Why I would recommend NPS to my friends” with some well thought out reasons and solid metrics: “Lego revealed that it was aiming for 5 million club members by 2015 and a net promoter score (NPS) of 75%…. the head of Citigroup’s consumer banking division had some good news for his team. After two years of crisis and more than £20bn in losses, the bank’s NPS had risen to 54%. That was 9% higher than a year earlier, and the first time the bank had risen above the 50th percentile since the data was first collected.” He also adds “Against the recommendations of professors and jealous research agencies (that despair of any metric simple enough for clients to use without their assistance) thousands of marketers have become advocates of NPS.”
iPhone tops NPS poll, no one surprised.
Zokem, an Espoo, Finland-based marketing company used standardized net promoter score (NPS) survey to analyze user loyalty of over 6,000 U.S. consumers in 2010 and found that the iPhone scored a 73 percent rating, while Android handsets took second-place with a 40 percent score. Research in Motion’s BlackBerry line earned 30 percent, Nokia’s Symbian was 24 percent, while Palm and older Windows Mobile phones pulled just 10 percent each. Interestingly, Zokem said Android users were actually the most likely to buy an Android phone again, at 89 percent, while iPhone owners get another iPhone 85 percent of the time. To explain how the statistics relate to the large gap in scores they point out Android powers a number of models and carriers, and consumers have more opportunity to choose and jump from one Android handset to another.
BlackBerry users stick with the platform 61 percent of the time, but only 28 percent of Palm owners and 8 percent of Symbian users plan to stay the course. Full source here.
When Irish “1″s are smiling…
Dublin based metricists W5 recently freely published useful Net Promoter benchmarks in Ireland. High street and grocery stores achieved the best scores, with health insurance and broadband providers achieving the worst. Download as a PDF here.
Metro Bank: Committed to NPS. Now this is newsworthy – a bank focused on customers using NPS. Anthony Thomson, co-founder and chairman of Metro Bank — first new high street bank to be opened in the UK for 150 years - talks about being a retailer not a bank, nixing staff sales commission and using Net Promoter as a business metric. “None of our customer facing staff have sales targets or sales bonuses — their rewards and bonuses are based purely on their customer satisfaction scores. We use Net Promoter and currently we have a Net Promoter score of 87% which I believe is among the highest anywhere in the UK — and eight out of 10 of our new customers come as recommendations from existing customers — 97% of our customers rate our service as being exceptional.” Read more…
According to self-puffer, NES Rentals Holdings, Inc. has set a “new Net Promoter Score record for the aerial equipment rental industry” with a 2010 annual score of 80.1. The lifting company achieved consistently high quarterly scores in the NPS process throughout 2010, including a quarterly high of 82.6 in the fourth quarter, derived from results of thousands of customer interviews and ratings throughout 2010. The company implemented the NPS program in 2007 and has received growing Net Promoter Scores each year since. “Achieving high customer loyalty scores in the midst of tremendous economic pressure in our industry is a testament to our team and their dedication to our customers,” stated Andrew P. Studdert, NES Rentals chairman and chief executive officer. “By making the customer experience our priority, it has led to a natural emphasis on customer safety and service, an emphasis that sets us apart from our competition and gives us the highest customer loyalty scores in our industry.” Source.
Sage keep “A deep customer focus” according to an opinion article covering their annual analyst event. Unusually for Sage, who have given NPS scores out before, it seems there was some reticence to give details. Could be that some rather sharp comments on the blog might be a more accurate representation of current customer sentiment. Judge for yourself on ZDNet.
Clockwork Home Services, a home repair conglom from Sarasota (owned by Toronto-based Direct Energy, the North American subsidiary of publicly traded Centrica) talk about Net Promoter in the Gulf Coast Business Review. Company head Scott Boose has implementedNet Promoter for all three service brands after learning the NPS ropes at British Gas. “A key component to the success was to be absolute on one rule from the first day: Well-dressed, polished and professional technicians were the only employees allowed to arrive at a customer’s home.” Key takeaway for Scott: Educating customers couldn’t be an afterthought in the home services sector. “If all we had done was fix the customer’s appliance,” says Boose, “but we hadn’t fixed the customer, then we’d be back.” Source.
The boss of Clayton Homes of Abilene, Texas describes the important the customer treatment to the company. Clayton Homes keeps track of each office’s Net Promoter Score, and earlier this month the Abilene office stood at 86 percent. To Buddy Parish they represent people customers can contact for testimonials about Clayton Homes. Those who answer with a 9 or 10 are promoters who will keep buying or referring friends. Nice homespun small-co reference: Source.
PPC-tweaker Covario held their annual INFLECTIONPoint Conference in downtown San Diego, CA last week, basing the conference theme on the movie Top Gun (Hey Covario, the 80′s called and want their uniforms back!). Oh and they announced that their Net Promoter Score, had shown an increase of 20 points. From where, to where, we sadly are not told.
TD Ameritrade announce jump in NPS. At an event so star studded that when Tony Blair had to cry-off (citing some minor middle east peace issue), Colin Powell stepped in at the last minute (what do the finance sector have on these people?), and it was announced that the company’s net promoter scores had ‘zoomed’ from 49 to 75. The jumps apparently reflect the fact that the company has ironed out technology glitches that cropped up when Ameritrade and TD Waterhouse worked to integrate systems and service after their merger in 2006. More conference details here.
Dell’s 66 second NPS soundbite: Adam Brown, Director of Social Media at Dell, explains why Net Promoter Score (NPS) matters so much to the computer-maker. Relevant snippet: At Dell, the NPS score is shown top right hand side of intranet screen, right under stock tracker. (Surely only a cynic would say that’s Dell’s relative positioning of NPS vs stock price?) YouTube.
Vodafone’s Turkish Delight: Vodafone Turkey on Thursday said its service incomes in Q3 in 2010 went up 31.7 percent over the same period a year earlier, becoming the fastest growing operator within Vodafone Europe, also adding that its net promoter score was 18 higher than that of its closest competitor. Source TurkishPress
Back-officers Blue Frog Solutions self-puffed about record high client loyalty and satisfaction levels “as ranked through a national scoring system”. “Blue Frog surveys its distributor and carrier clients semi-annually using Net-Promoter Score (NPS)… ” said SVP Joe Breakey, “Survey results … help assess the performance of our employees.” (translation: we bonus our staff on NPS). BlueFrog claim industry leading survey 72% response rate and say Net Promoter Score climbed to an all time high in December and “scored higher than nationally well known organizations such as EBay, Costco, State Farm, Geico, and Cigna.” Source.
Amcor, Australian based ore-botherers talk about NPS and the amalgamation of Alcan. “All the while the discipline of the so-called “Amcor way” will be drummed in – the key elements are safety, customer focus, talent, capital discipline and low costs, each with its own key performance indicators, programs and deliverable targets.” Customer focus, by way of example, is delivered by making clients happy through innovation and profitable sales growth, which comes from a range of programs including environmental action, and is measured by Net Promoter Score, among other tests. Australian.
BallenIsles birdies NPS, crowned Country Club Facility of the Year. Interesting to see that Net Promoter has been adopted by the golf set. Troon Golf, the world’s largest golf management company, with operations at properties located in 30 states and 23 countries honored BallenIsles Country Club, as it nearly tripled its NPS ranking, used to evaluate loyalty and the Club’s relationships scores. Source.
Bloomingdales hire for NPS: Spotted in the SitVac ads, retailer Bloomingdales specify Net Promoter Score Experience in job ads: “…analyze our performance in the Net Promoter Score (NPS) customer engagement survey” Manager, Customer Service and “Achieve store Net Promoter Score goal.” Distribution/Logistics Manager
And the NPS Razzie goes to… Barclays.
As a bookend to the Metro Bank story, read another Mark Ritson piece in MarketingWeek, about how tone deaf Barclays manage to be. “After more than 90 minutes of bonus-based questioning, committee member George Mudie MP changed tack and [...] then referred to Barclays’ all-important net promoter score, widely acknowledged as a key metric of banking performance, which currently sits at the astonishingly low -35. Mudie asked whether Barclays’ ability to generate huge profits while treating its customers so badly provided clear evidence of a lack of competition in the British banking sector. He looked across at [Bob] Diamond and waited for a response. But Diamond, sensing that this was a question about customers, took a long drink from his cup of water and handed the floor over to Anthony Jenkins, his head of retail banking.” (This also tallied with surveys completed by Millward Brown and Geronimo that both rated Barclays as the worst performing bank in their respective net promoter research studies). Ritson closes with “perhaps no-one at Barclays actually cares about what their customers really think. In the weeks ahead the furore around £1m bonuses during Britain’s worst period of austerity in living memory might encourage the leadership team at Barclays to take a more customer-centric view. MW.