Keeping customers satisfied and loyal has become one of the key foci for recurring revenue companies. To do this account managers need to determine which accounts to prioritize and what kind of measures they exactly need.
In an earlier article it was shown that by measuring a customer’s loyalty (the Net Promoter® Score) with a product/service and pairing this with their revenue, companies can better segment their customers into different strategies. Those that score a company poorly but bring in large revenue are more in need of problem resolution and are more important than those that score the same but bring in low revenue.
The loyalty spectrum as a guide
However, this is just the beginning of the story, as a question quickly arises that needs clarification. Does a higher NPS mean an account is more healthy or loyal than lower scoring accounts?
To this, the answer is yes, but this ‘yes’ is just a rule of thumb not an absolute. For at times accounts with a lower NPS may be in fact be more loyal than accounts with a higher NPS.
[caption id="attachment_15629" align="alignright" width="371"] NPS is a good measure of health, but appearances can be deceiving.[/caption]
For NPS as a measure of account health should be understood in terms of likelihoods. If the NPS (-100 to +100) of one account is 0 (meaning an equal number of detractors and promoters), while it is possible, it is less likely that this account is more loyal or healthy than an account with an NPS of +10 or +20.
However, while an account’s NPS is a measure of the likelihood of its health, those accounts with scores at the extremes (-80 or +80) are clear indications that they are either very unhealthy or very healthy.
Loyalty helps account managers better segment accounts and create a system by which one can generally say that the higher their NPS the healthier they are, but it is not the complete picture. Why is that some accounts may show a high NPS but ultimately need more care, while other lower scoring accounts are actually more satisfied than their score portrays? To answer this account managers need to look at the granulized NPS data of each account to gain a better understanding of just what is happening.
Unpack an account’s loyalty
Within every company there exists three levels: the decision makers, influencers and end-users. A well-managed account then will have key individuals from each level in relation to the account and it is the results of these individuals that create an account’s NPS.
[caption id="attachment_15618" align="aligncenter" width="661"] Who are your promoters and detractors, and at what level of the company do they exist?[/caption]
However, by unpacking an account’s feedback and discovering which level exactly is scoring a company poorly or highly, account managers can better understand the overall NPS an account displaying.
Here a few scenarios help outline why this is so. Take for example an account in which all respondents are promoters (9 or 10 out of 10), all except one or two decision-makers who score you a 2 or 3. In this type of account you would have a good NPS. But while your end-users and influencers love it, there is something going wrong at the top level. This account then might not be as satisfied and loyal as you think, as the key players are struggling to see the value of your product.
Alternatively, you may have an account in which all the end users are detractors, while all influencers and decision makers are promoters. Such a makeup will produce a low NPS especially if you survey more end users, which is often the case. However, by looking further into the data though it is clear that this account might not be as disloyal as first thought, as the key levels of the account are satisfied with the product’s results.
N.B. End user’s problems are most of the time functionally related. These problems then are often the result of lacking the ability to do something. Scenario’s as the example just above, mean these accounts can be primed for add-ons, new features, new licenses.
Your customers will tell you what’s right or wrong
Above we explained how account managers could better understand the composition of an account by looking at the individual scores of each respondent in an account.
Whether it is NPS that is used or other loyalty metrics, a good but concise loyalty survey will not simply ask a rating score, but also ask for the drivers behind that score presenting the respondent with a list of options. With a comment box also presented to the respondent in which they are free to say what they feel.
This third layer of data enables account managers to look at individuals within an account and determine what is it that makes them loyal or disloyal. Did they select customer support, product performance or maybe professional services as the reason behind their score? While the comment box allows respondents to either elaborate further or highlight a completely separate issue.
For example, maybe a respondent scores a company a 5 or 6 but within the comment box they explicitly state that they are looking for a particular functionality. This extra information means that the account manager not only knows what the problem is exactly, but could potentially resolve the problem through an upsell.
Loyalty data provides direction
Creating account management that targets the needs of each account and better allocates the resources of account managers is a three-step process.
- Measuring the NPS of a company’s accounts provides a system by which account managers can better understand the health of their accounts. However, while it is a good means of bringing up “red flags” quickly, it is only a measure of the likelihood of their health.
- Unpack an account’s loyalty feedback. What is the individual’s score by account level? What is the composition of each account? Knowing which level is giving you a high or low score means a better understanding of an account’s loyalty score.
- Discover the drivers behind a score and comments, help account managers understand what specifically is causing a grievance or is maybe greatly valued. Actions and resources can be better targeted inline with the information gained here.