If you have a business it’s likely you want it to grow, become more successful and ultimately become more profitable. I believe that by asking one powerful question you can gain real insight into your operations and have a competitive advantage over your competitors.
Companies that achieve long term success have a Net Promoter Scores (NPS) that is on average two times higher than their competitors and as a result grow a twice the pace.
So what is a NPS? Simply put it’s a fundamental system created by Bain and Co. They believe every companies customer base can be divided into three categories. “Promoters”, “Passives”, and “Detractors”
The most efficient way to work out your company’s potential to grow is to take the percentage of customers who are “Promoters” and subtract the percentage who are “Detractors”
Your customers will answer the ultimate question on a 0 to 10 scale, which is “How likely is it you would recommend us to a friend” This is a powerful question as great and interesting companies provide a lot of social capital, unlike companies that might be lacking in certain areas of customer service. Many people will not recommend poor performing companies to their friends so this is why the questions is so vital.
Impress one person and potential get a handful of their closest friends signing up to buy off or insult and underperform and have many of them defect and leave to your competitor.
The scale and question is easy for customers to understand and answer. It’s quick and painless too so you can gather results fast especially if you use digital online tools like, SurveyMonkey this will crunch all of the numbers for you and you can get some pretty interesting data to aid in your business decisions.
Remember that you want more Promoters (score of 9 – 10) in your business. This is a true measure of how well you are doing and going above and beyond the expected levels of service.
People who score 7 – 8 are Passives these customers are normally 50% less satisfied then promoters and will defect if a competitor offers them a better deal.
And what you really want to avoid are Detractors (score of 0 – 6) these are unhappy customers and can count for up to 80 percent of negative word of mouth. These can cause all sorts of issues in regards to your company’s reputation and they might even try and discourage new customers signing up to you in the first place.
If you do find you have a low NPS this is not the end of the world as you can tweak your business practices, improve the products and services you provide and hopefully increase it, Feedback is a gift and a free one at that.
This is a powerful tool to use and one I would especially start asking at the beginning of the year.
*Originally published in About Thetford Magazine