Building life long loyal customers is difficult and complex. But the measurement of it can be easy. Fred Reichheld says that it comes down to one question – what is your Net-Promoter Score?
A company’s Net Promoter Score (NPS) is based on the fundamental perspective that every company’s customers can be divided into three categories: Promoters, Passives, and Detractors. By asking one simple question — How likely is it that you would you recommend [Company X] to a friend or colleague? — you can track these groups and get a clear measure of your company’s performance through its customers’ eyes. Customers respond on a 0-to-10 point rating scale and are categorized as follows:
Promoters (score 9-10) are loyal enthusiasts who will keep buying and refer others, fueling growth.
Passives (score 7-8) are satisfied but unenthusiastic customers who are vulnerable to competitive offerings.
Detractors (score 0-6) are unhappy customers who can damage your brand and impede growth through negative word-of-mouth.
To calculate your company’s NPS, take the percentage of customers who are Promoters and subtract the percentage who are Detractors.
We recommend this program to our clients. To find out more, you should visit Net Promoter http://bit.ly/8a2tAp . If this is interesting, there is a book about how to implement this practice.
In their book, Answering the Ultimate Question, Richard Owen and Dr. Laura Brooks of Satmetrix describe the Net Promoter Operating Model that captures the elements necessary for a successful program. The operating model provides a best practice framework for how companies collect and act on customer feedback to optimize financial benefits.
Please comment to mail@robertgonsalves.com and let us know if you have heard about the Ultimate Question and if you have had any experience implementing a customer satisfaction program at your business.
My friend and colleague, Robert Gonsalves built the award-winning, online success of Disney Online and Warner Bros. Online, and now consults to CEOs and senior executives to build loyal life long customers and to drive profitability from their online efforts. Check out his site at www.robertgonsalves.com.
