Net Promoter News: Bank Montreal 44, HomeDep nail 64, eBay go 0-10, Gas burns 30, SmartPen writes 54
Bank of Montreal Group report Net Promoter Score of 44
From the BMO Financial Group F4Q09 (Qtr End 10/31/09) Earnings Call Transcript. Bill Downe – President & CEO: “[we] improved our net promoter scores for both retail and commercial in 2009.” He drilled down to P&C Division U.S, emphasising strong fourth quarter results and added: “Our retail net promoter score was 44 for 2009, compared with 42 in 2008, while the average scores of our large bank competitors declined.” Source: SeekingAlpha and TradingMarkets.com
Other financial snippet: The managing director of A & G Insurance Services Australia, Michael Weston, boasts his company’s direct-to-market brand, Budget Direct, has a high net promoter score (but is only teasing us by not revealing it…) Sydney Morning Herald.
Weaponising NPS at Easynet for an Industry to become “responsible”
UK ISP Easynet Connect are calling for a common benchmark for measuring customer service for business ISPs: “We’ve been using the Net Promoter Score internally for a few years now. Since adopting it our score, and therefore the customer service that we actually deliver, has improved significantly in just a few years. It is a powerful tool that keeps you on your toes,” said Harry Eastman, Operations Director, Easynet Connect “Crucially for us, we use the NPS to zone in on problem areas. If our CRM is the big gun in our arsenal, then NPS is without doubt our targeting system for that gun.”
Julian Harriott, Business Manager, Communications Management Association (CMA) says “… Adopting a standard like Net Promoter Score is the responsible thing [for the industry] to do…” Sourcewire.
Home Depot toughs it out.
It was a tough 12 months for the DIY shedsters. But they took comfort from increased customer loyalty. Frank Blake – Chairman and CEO: “On the store operations side, our net promoter score, [...] with 64.1% in October, over 8.5 percentage points higher than last year at this time.” From the Home Depot, Inc.Q3 2009 Earnings Call Transcript on SeekingAlpha and slides.
eBay “just testing” the zero to ten scale
“This is a just a test…” say eBay UK, who have started to trial Net Promoter Score feedback for buyers (Source: Tamebay). Sure it is. eBay have been using the Net Promoter Score internally for a while. This from the recent eBay Q3 2009 Earnings Call Transcript: “Our net promoter scores are up for both buyers and sellers.” says CEO John J. Donahoe. “….our focus on great customer experiences and customer retention and loyalty is as strong or stronger today than in any time in the last couple of years. [...] I changed the senior management incentives so the top 600 people in the company, part of their annual bonus is driven by improvements in essence in customer loyalty, as measured by net promoter scores. So we made good progress.”
British Gas Mark 30
Sensible tips from British Gas, winners of the European Call Centre of the Year award.
Tip 4: Use Net Promoter scores – Show scores on your wall boards. “We adopted the Net Promoter score as our key measure of customer satisfaction. Our agents are bonused on a combination of their Net Promoter score and the percentage of their customers that fill in a telephone-based post-call satisfaction survey. A bonus is payable based on the score and if 25% of their customers complete the survey. Progress has been significant and has gone from -20 to +30 in the past 18 months.”
Source: Call Centre Helper
DragonAge NPS (as recommended by Dark, Heroic Fantasy World Gamers)
Founder/CEO of Canadian developer Dragon Age: Origins BioWare, Dr. Ray Muzyka spoke about KPIs for game developers: “Net Promoter scores, which is more of a fan opinion they recommend to their friends, that’s a useful metric.” Source: VideoGamer.com
Strong loyalty with “Life Changing” Pen
Livescribe’s senior marketing director and UK GM, Eric Petitt was interviewed about the no-computer-needed SmartPen. Read more on PCR
In a recent US national survey of 5801 registered Pulse smartpen users, 74.5 per cent said they were very likely to continue using it, 92 per cent have demoed the pen to a friend, while 73 per cent said “Pulse has changed my life”. We also got a 54.2 net promoter score (recommenders minus detractors) – this puts us in an elite group of brands, alongside Apple and Southwest Airlines.
Buy on NPS!
One of the original ideas behind Net Promoter Score was that companies with a high Net Promoter Score should provide better investment opportunities. In the appendices to The Ultimate Question Fred Reichheld shows graphs with NPS and growth correlated. So it’s nice to see the market catching up with this thinking. I saw this headline: “Companies You Should Buy Right Now” from MarketMixup, with the sure-fire stock picking strategy of “So if you want to make serious money in stocks, start with great companies. [...] Costco (Nasdaq: COST), for example, has a high net promoter score“. I’m looking forward to the first NPS Portfolio I can invest in…
Career Tip: From IT manager to CEO via NPS.
How a senior IT executive can move beyond a traditional role in technology (i.e. become a CEO) is discussed in What it takes to become ‘the extended CIO’, a book from Richard Hunter and George Westerman. An excerpt:
Since 2006, Leonardson [Butch Leonardson is CIO of Boeing Employees Credit Union (BECU)] has cochaired a BECU customer and employee loyalty initiative called Net Promoter. [..] “When a BECU employee logs on in the morning, if he’s [customer-facing] staff, he sees our four strategic objectives—the target and where we are,” Leonardson explains. “With Net Promoter we’re supposed to be at 73.5 percent right now, and we’re at 74.6 percent.” [...] Leonardson continues to seek improvements in the company’s ability to use data to improve performance for customer service. … “
From CIO Canada (24 Nov 2009) IT World Canada
Our occasional feature showcasing links to NPS-deniers. This week, Flat-Earther Augustine Fou gamely argues the view “What’s wrong with the Net Promoter Score”. Plenty of (well-informed) pro-NPS heckling follows in the comments, with even the author repenting: “… I will definitely grant that some clients may be able to use NPS, given a deep understanding of what it can and cannot do.”
*Researchism: A new term that I just made up referring to the quasi-religious beliefs of some market research professionals that the Net Promoter Score is pure Evil, and that a proprietary scoring system derived from 40-question questionnaire is better than any other surveying system. A form of business creationism, probably done to protect a revenue stream rather than helping clients.
Weekly round-up of Net Promoter News from round the globe.
Smart Resources Inc, a Chicago Temp Agency promotes “Industry’s Highest Client Satisfaction Ratings” in a self-puffer here. Citing recent study by CareerBuilder and Inavero Institute, Smart Resources received a Net Promoter Score of 74. As a control, the staffing industry average NPS was 25%. More…
Miserable marketers minimise media, move to metrics… After the slump brand owners are ready to go straight back to spend, Spend, SPEND reports MarketingDaily but may also have to employ some people who can do math, as they expect to use more customer-related metrics. According to their survey, marketers are more interested in brand health metrics compared with February 2007, with increased attention on customer conversion/repeat rates and net promoter scores (73% now vs. 67%). Source here. Hold tight while marketers actually start to listen to customers…
HD Supply win award, save $3m… San Diego based Fac-Mans HD Supply won the Gold Award from American Society for Quality with innovative approach to use voice of the customer data to drive operational excellence. Benefits included improved customer loyalty and +6% NPS, which resulted in $3 million in savings. Read details here
eBay move to transactional NPS… Coverage of interview with Director of Seller Standards and Feedback, Brian Burke at the online gavel-swingers on replacing existing old-as-the-hills feedback system: that “Transactional NPS is applying customer loyalty metric after each transaction, much like we do with Feedback today… NPS provides sellers with much richer information about the transaction and the sellers who’ve participated in the pilot have pleased with the added information.” More from Gianostore.
NPS-softer CustomerGauge shows new views on Net Promoter in summer-09 release. Lots of b2b views plus customer sentiment classification improvements on top of easy-to-use interface. Details here.
Home Depot report NPS in F1Q09 Earner Call. Home Depot notes to Wall Street via CEO Frank Blake: “Customer service continues to improve… Our net promoter score… has improved 790 basis points year-over-year and is now at 61.5%. That is a meaningful improvement.” We agree. From SeekingAlpha
Fin-Server Investors Capital Corporation whips up Net Promoter Score to “deliver Premier Service to Financial Advisors”: Investors Capital’s NPS for the first quarter of 2009 was 66%, up from 60%, 60.2%, 60%, and 49% for the four quarters of 2008. Source: American Chronicle
More market research community flat-earthism from the Southern African Marketing Research Association, who continue to deny marketing Darwinism: “The ideas that spread the furthest are often not those with the most merit: …the widespread use of the Net Promoter Score when it does not stand up to scientific scrutiny are examples.” says their King Canute Enrico Tronchin. Chuckle more about it here
Finally, from Net Promoter Conference London, 4 June via twitter:
- “Philips has seen that promoters spend more (69% sales growth) compared to passives (6%) and detractors (-24%).”
- “Experian mentioned that many of their own clients also use NPS, so it is becoming a common language to discuss feedback.”
CustomerGauge June 2009 release adds new features to this simple, cost-effective loyalty measurement system based on Net Promoter Score®*. CustomerGauge is known for its extensive business-to-consumer (b2c) surveying capabilities, particularly for automatically surveying customers after e-commerce transactions.
In this release, it adds specialised reporting for business-business (b2b) applications.
New reporting helps clients view Net Promoter Score by multiple segments and grouped by organisations. Real-time dashboards show scores and comments from individuals inside an organisation by job or function level – to give a top down view of major corporate customers. Compare results with all customers, or by all job categories. Quickly identify promoters and detractors within major accounts.
Other reporting helps show distribution of Net Promoter Scores 0 – 10 by frequency, and the evolution of detractors, promoters by week or month. Drill-downs allow quick analysis of comments in each segment. Another report makes it simple to rank Net Promoter Score in a particular segment (for example by country, or sales revenue cluster). A/B options allow experimentation to find optimum survey design.
Understanding customer sentiment is a key component of CustomerGauge. Reporting has been enhanced to provide multiple level of analysis. Simple graphs showing trends help get to root causes fast and effectively.
CustomerGauge is made for global deployment, with new enterprise-class features for multiple countries/divisions roll-out. But flexibility is also built-in to allow local management, reporting and customisation. A new global dashboard option allows roll-up of Net Promoter Scores from separate divisional instances of CustomerGauge (or even other survey tools).
With this release, CustomerGauge continues to evolve and provide a fast, effective way for enterprises to measure Net Promoter Score, priced from EUR 1500 per month.
CustomerGauge is a hosted software solution from Amsterdam-based Directness BV designed to automatically survey customers and measure loyalty. The results are compatible with the Net Promoter® Score* (NPS), acknowledged as the industry standard for loyalty measurement. It can be rapidly deployed anywhere in an organization, without investment in capital equipment or IT assistance.
*Net Promoter is a registered trademark of Satmetrix Systems, Inc., Bain & Company and Fred Reichheld
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.
Satmetrix release their 2009 Net Promoter Benchmark Reports today. Some highlights include loyalty leaders Apple driving NPS of 77, Amazon at 74 and Google at 71. Online services had the highest average Net Promoter Scores of all industries, with Telco bringing up the rear with an average of -7. More details in press release.
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Australia’s MacMillan Shakespeare (“premier provider of workplace benefits”) confidently predict hitting a Net Promoter Score target: “We will achieve high net promoter scores ≥45%” (according their analyst presentation PDF, March 2009)
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Still in Australia, Chris Roberts talks about Generating Growth in a Contracting Economy, and his 1500 customer Net Promoter Score survey of Australian banks. Source: UQ News
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Finally, web-hosters ServerBeach ride a high tide of Net Promoter Scores to reach 49, according to blog.
Franchised tripperco TravelCounsellors climbed to a Net Promoter Score of 94 in early 2008 using a seven country metric. Each Travel Counsellor franchisee can see his/her score on company intranet. More from eTravelBlackboard (note that the reporter seems to have made an error in documenting NPS methodology)
Cherry-picksters NES Rentals do some heavy lifting to get to Net Promoter Score of 72, and trending higher says company spokesman according to Rental Equipment Register. With 15,000 surveys completed since March 2007, NES look set to reach 76 later this year. Recently rival RSC Rental announced NPS of 64 (enGaugement).
Brown-goodsters LG‘s Veep of Comms presents the LG Consumer Electronics Overview 2008, including some Net Promoter Scores of TVs. John Taylor quotes their mean Net Promoter Scores of 64 in LCD range, with a high of NPS 72 for a 42″ LCD, although no mention of methodology or numbers. Grab the presentation from the web before it disappears. In another snippet, agency bravely aims to track online conversations with LG offline Net Promoter Score (New Media Age)
New Zealand Post-owned finco Kiwibank notches up Net Promoter Score of 60, according to twitterer BankingReview. If so, this puts it close to top of the list of Australian Banks (see article enGaugement: Oz Banks Ranks)
Finally, blogger shmula writes about the power of negative word-of-mouth, and how publicising a twitter-powered whinge about HomeDepot experience reached 3,000 people. HomeDepot amazingly picked up the twitter-moan, but since dropped ball. Net Promoter Score: Fail. Follow story here.
Australian Big Banks Lose out to Smaller Lenders
Australia’s Broker News carries news of CoreData’s survey of a selection of Net Promoter Scores from Bank Services, with a small bank beating the big boys. In the NPS survey, Banking minnow Members Equity Bank (MEB) scored +61.6.
Other banks appeared to be all negative:
- Westpac –29
- ANZ –32
- CBA -40
- St George –40
- NAB -60
Our previous coverage of Aussie banks (mar 2008) here for comparison of last years scores.
Theatre Group’s excellent Net Promoter performance
Sweden’s Södra Teatern surveyed its audience for the third year running. Their Net Promoter Score (in swedish: Ambassadörsindex) was a standing ovation winning 76%. Source ”Publiken gillar Södra Teatern” here
eBay bonus plan includes Net Promoter
AuctionBytes Ina Steiner reports that eBay are focusing on a customer retention strategy, and using Net Promoter to incent behaviour. In eBays new comp plan, executives may lose up to 20 percent of their bonuses if they don’t meet customer retention targets. Source: AuctionBytes