Customers are the most valuable capital in any business. In addition to being the ones who will consume your products or services, they will be the main promoters or detractors of your brand, depending on the experience they have with it.
Having them on your side will guarantee you not only word of mouth advertising, one of the most effective and least expensive, but it will also allow you to build a loyal community around your company.
To find out how committed they are, today we present you a very useful tool.
One of the most important factors in evaluating whether what you are doing is working is measuring the degree of satisfaction of your customers.
You depend on their loyalty to make sure they continue to choose you and to get new ones added.
Knowing what those who consume your products think of you is essential to adjust strategies and above all to improve the user experience.
They are the only ones who can tell you with certainty if what you are offering works for them and if your marketing and advertising efforts are working.
In the relationship and interaction you have with customers, you will discover those things that, due to your position within the company, you may not be able to observe.
Now, how do we know what they think of your business? The Net Promoter Score is a tool that will allow you to know the level of satisfaction that your customers have and know what they think about your brand.
NPS (Net Promoter Score): Definition
The Net Promoter Score (NPS), as we said before, will help you measure the loyalty of your customers and know in-depth what they think of your business.
It is a formula that allows evaluating the level of commitment to a brand by just one question: “From 0 to 10, how much would you recommend my brand to your friends?”
On this basis, the question may vary in its formulation, but it is important that it conserves the essence to obtain the result that we seek.
The objective of this indicator is to discover, through this inquiry, the possibilities that a user will recommend your business to their inner circle.
This number shows the level of satisfaction since we understand that if as a user you are willing to recommend the brand, it is because you are more than satisfied with what you obtained.
We know that recommendations and word of mouth are essential and very effective forms of dissemination to achieve growth in the market. Users trust the comment of a person they know more than an advertisement, which greatly influences the purchase decision.
For this reason, the NPS will allow you to have an overview of the profitability of your business and the possibilities of expansion.
From this analysis, you will obtain an index of the disposition of your clients towards your brand, which will divide them into three groups according to their experience with it and the chances that they will recommend it: Detractors, Liabilities, and Promoters.
Later we will detail the typology of these users, but first, we must clarify what we mean when we say ” measure” loyalty. Let’s dig a little deeper into this topic.
Loyalty: Can It Be Measured?
We define the Net Promoter Score as an indicator that allows us to know the degree of loyalty of a client towards a brand and the satisfaction obtained with it. These two concepts are closely related, but they are different.
The NPS will allow us to know not only if customers are satisfied, but it will also show us their degree of loyalty. But what is the difference?
You can observe customer satisfaction in the relationship of the product with the expectations. If what you offer meets what the user expects, we can say that they are satisfied.
Talking about loyalty, on the other hand, implies a commitment a little deeper into the relationship between the consumer and the company. A user is loyal when they have the predisposition to buy again from your business.
So a user may be satisfied, but not loyal, but whoever chooses the brand again is very likely to be satisfied. Measuring the NPS will allow you to approach the information in these two senses.
Satisfying customers is not a difficult task: it is enough to meet expectations. Satisfaction is temporary and we can measure it in the specific attitudes of users when making a purchase.
Generating loyalty is a bit more complicated: it has to do not only with the product but with the entire experience that customers go through in the purchase process. It is a longer path, in which we can predict their behavior and future actions.
So can we measure loyalty?
Yes, and doing so gives us much more useful data than just measuring satisfaction. It is a forward-looking, low-variable, slow-growing metric that provides insight into upcoming customer movements.
How to measure brand loyalty?
There are many ways to measure loyalty that has developed over time. In general, they are divided according to the origin of the information they use.
On the one hand, we have those methods that collect data by analyzing transactions; that is, they are based on the recording of real behaviors, such as the number of purchases made.
With these numbers, very varied predictions can be made regarding the possible behavior of users.
Another option is to use information that the customer provides before making the purchase; that is, the declaration of interest. In this instance, it is common for a survey to be conducted to collect data.
However, none of these approaches can by itself provide us with concrete and complete information on user loyalty levels.
The Net Promoter Score came as a totally innovative mechanism: survey responses were compared with actual customer behavior.
Several questions were tested until reaching the one that worked best, the one we already mentioned: How likely is it that you recommend the brand to your acquaintances?
The relationship between responses with high scores and frequent purchases, recommendations, and future behaviors of great brand loyalty is proven.
This gives us the guideline of the great importance of measuring the NPS and its advantages. The next step is to learn how to improve this number.
As we anticipated a bit, the NPS will result in a division of clients according to the probabilities of recommending the brand.
The answer must be numerical, from 0 to 10. These values show the number of users who would never recommend your brand (those who score from 0 to 6), those who are neutral (7-8), and those who are at the highest levels of satisfaction (9-10).
Let’s dive into each of these categories.
They are those users who score between 0 and 6: they would not recommend the brand and are not satisfied with it. They are also usually very critical and would not interact with the company again.
The only way to make them change their minds is to give them a new experience, radically opposite to the one they had. To do this it is important if we can identify them, listen to them, and ask them the reasons that gave rise to this rating.
We can also divide them into 2 types:
- Low detractors (0-3). It is very difficult for them to change their minds in the short term, but you can think about neutralizing them so that they do not tarnish the reputation of your business by becoming trolls.
- High detractors (4-6). You can work to change their perspective, but you must listen to them and heed their criticism.
By identifying these two types of naysayers, you have the tools to personalize how you approach them to try to win them back and prevent them from passing over to the competition.
Passive or neutral users are those who scored 7 or 8 on the survey question.
It is a middle point where they are satisfied not to criticize, but not satisfied enough to recommend to their acquaintances.
This makes their loyalty fragile and they can be easily captured by the competition.
If you can identify them, try to discover what makes them not score higher and what you can do to make them become promoters.
They are the customers most committed to your brand: they rated it 9 or 10.
They are undoubtedly satisfied with your business and are loyal to your brand; it is very unlikely that they will pass the competition and they will surely recommend you.
It is very interesting to plan a strategy around these clients so that they function as your influencers or ambassadors.
How to Grow Your Recommendations
The first step to improving your NPS is asking the question and analyzing the results.
Focus on those clients who gave you good scores and study why they did so: so you can transfer the experience of the promoters to the rest of the users.
Your best efforts should be focused on retaining this segment so that your resources are used to the maximum. Increasing customer retention has similar cost-cutting effects (according to a Satmetrix study ) because it is cheaper than recovering those who are lost.
To grow your company, loyalty strategies have to be personalized and directly appeal to emotions.
Your main objective should be to create an emotional connection with customers that goes beyond the product, that lasts over time, and that causes feelings that culminate in a recommendation.
As we mentioned before, word of mouth is one of your most important allies and you cannot leave it to chance.
Reward the most loyal users: use the motivation and enthusiasm they already feel for the brand to boost your reach and plan actions around them.
You can ask for reviews or spread success stories, make special promotions for recommendations or campaigns on social networks with the use of hashtags.
Also, make sure you have a good understanding of why users become naysayers and spend time planning ways to neutralize them.
In this sense, it will be very useful to customize the reports of the studies according to the needs of your company. By focusing on what really works for you, it will be easier to hone your performance to offer better solutions.
“Your main objective should be to create an emotional connection with customers that goes beyond the product, that lasts over time and causes feelings that culminate in a recommendation.”
One of the factors that influence loyalty is the complete user experience with your brand. To grow your recommendations, you can evaluate the impact of customer service at all stages that consumers go through.
Good care generally means more loyalty, but the parameters that users consider good care can change.
To improve this aspect, you must share the results of the survey with all areas of your company: their collaboration will make it possible to find comprehensive solutions to improve the user experience.
Joint work is key to carrying out an action plan aimed at obtaining a greater number of recommendations.
Managers and team leaders are responsible for promoting a customer-centric organizational culture.
The best recommendation is to think long term. The loyalty levels of your customers will not rise from one day to the next: you must worry about building a meaningful relationship that lasts over time.
Address the claims and needs of your consumers to improve their experience and, as a consequence, the recommendation levels will rise.
Benefits of the Net Promoter Score
As we have already been talking, the Net Promoter Score is a metric that will be very useful for your business, as well as being one of the most used in the market.
It’s simple, consistent, and popular, making it the ideal tool.
It is easy to understand and therefore easy to communicate to all the members of your team. This allows us to propose improvements and talk about success stories in a much more accessible colloquial language.
Being one of the most popular indexes, there are several ways to compare the results.
If, in addition, you go beyond the number and seek to analyze the reasons for the behavior of your customers, you can generate a more efficient operating system to satisfy them and improve the scores you receive.
Other Metrics to measure the relationship with the customer
In addition to the NPS, there are many other metrics that will allow you to know the state of the relationship with your client.
These numbers can come from reports based on their behavior or from surveys that will allow you to collect information.
In the latter, you will be able to obtain the opinion of the users in a more direct way, while the former will give us data through their actions.
To have complete information, it is important to gather as much data as possible: you must bear in mind that a single indicator will not give you enough material.
Besides the Net Promoter Score, there are other ways to measure through questions.
The CSAT «Customer Satisfaction Score» gives us an approximation to customer satisfaction through a direct question: ” What is your level of satisfaction with respect to X?”. The numerical answer should be from 1 to 5 or 10.
The Customer Effort Score measures the customer’s effort to interact with the company. In this case, the question will be: ” How easy was it to use X service?” The answer must be between numbers 1 and 7.
On the other hand, we have those metrics that we will obtain from customer behavior, such as the Customer Churn Rate. This is the number of customers who, during a given period of time, did not engage in interactions with the company.
The Customer Profitability Score calculates the relationship between the amount of money a customer spends on the brand and what the company invests in acquiring the customer.
Finally, the Customer Lifetime Value allows calculating the profitability that a customer contributes during the time in which they remain as such.
With this information in hand, you can analyze the performance of your promotion strategies to continue applying those that show good results and to propose changes in which they can be even better.
Customers are one of the most valuable resources your business has: you must take care of them and ensure that their experience is positive and unforgettable.
The Net Promoter Score will help you to know in-depth what users think and the level of loyalty you have.
If you use this information to your advantage, you can plan and find alternatives to improve the way you interact with them from each area.
The best actions come from the real data provided by the users themselves. They will be able to tell you exactly what works and what you can optimize to deliver what they need.
Don’t forget: the recommendations of your satisfied customers are the best publicity you can get.