Net Promoter Score

Net Promoter Score – What is it and Why Does it Matter For My Business?

A Net Promoter Score (NPS) is a metric used to gauge customer loyalty. It is calculated by subtracting the percentage of detractors from the percentage of promoters of your business. It’s that simple. But what does it mean? This one figure can hold a lot of meaning for your business.  Read below for advice on interpreting your NPS as well as how to interpret other key CX metrics.

1 in 4 of you will loose your job this year

Why 1 in 4 of You Will Lose Your Job in 2020

1 in 4 of you will loose your job this yearYour CFO doesn’t care about your customer experience (CX) surveys. She cares about the health of your business, and it’s unlikely she sees a direct link between your survey scores and the measurements she follows.

Meanwhile, your CEO is focused on your customers, but that doesn’t mean he cares about your surveys, either. As one business leader confessed to me, “I keep seeing these survey scores saying we’re doing great. Then I meet with customers who they tell me how frustrated they are. So I don’t believe in the surveys.”

By extension, that means he doesn’t believe in his CX team.

So by focusing on customers scores, you’re at risk. Forrester predicts that one in four CX pros will lose their jobs in the year ahead, because they aren’t showing business impact.

Measurements Beat Metrics

Metrics are survey scores – that’s what CX focuses on. We’re really into them. They’re nice and neat, and easier to collect.

Measurements are what the business cares about. But they are trapped in operational systems, making them messy and hard to nail down. Lost customers, reorder rates, order size, service costs, repeat business – those are all measurements with financial impact.

That’s where you grab your CFO’s interest. You’re at risk if you don’t tie your program into these measurements.

The Evolution of CX’s Trouble

I see this story played out repeatedly. A customer-focused leader introduces the concept of CX to the organization and builds a CX team. She believes in the power of CX, and the team puts together a survey system and introduces the Net Promoter Score (NPS) system or the Customer Effort Score to the company. All is right in the world.

Until that leader moves on. That’s when things get dicey.

The new boss isn’t steeped in CX philosophy. So she asks a simple question: “How does this impact the business?” And CX struggles to respond in a compelling way.

This happened to a friend of mine. Her boss was terrific, sharing the CX story throughout the company. She loved working for him. Then his position was eliminated.

His replacement met with her still-new team and shared that he didn’t really understand what they did. Furthermore, he said, “So, you have insights – so what? What are you doing to drive the business?”

Suddenly, my friend and her team were at risk of being among that 1 in 4.

How do you ensure you’re one of the 3 in 4 who will keep their jobs?

Or, better yet, how can you become one of the 25% of companies that are able to quantify CX benefits or achieve a competitive edge?

One way that we’ve seen work well is loosely based on the research shared in our book, How Hard Is It to Be Your Customer? Using Journey Mapping to Drive Customer-Focused Change. My co-author Nicole recently addressed this topic here, too. To do this:

  1. show CX impact to drive changeUnderstand what the business cares about. Look for the measurements that matter and find a meaty business problem you can attack.
  2. Identify a journey and customer that impacts that measurement. Start with a journey, because since it involves multiple silos, it likely involves handoffs, a common source of customer friction. It’s also easier to impact than the entire end-to-end experience, as I discussed here. One phrase that came up repeatedly when we interviewed successful CX leaders for our book was “boiling the ocean.” Avoid that pitfall by choosing a focused journey. Identify a clear business problem, then rally your leadership to conquer it.
  3. Form a team that can create CX impact, as we discussed here and here. Involve every silo that touches the journey, including back-end teams such as IT, Finance, and Legal.
  4. Involve customers to learn what’s really driving their experience, so you truly understand what’s causing the lost business or low reorder rates. And remember – you can’t create a customer journey map if you don’t involve customers in the process.
  5. Identify the measurements that matter in the journey. You may have started with a high-level measurement, but you’ll discover many more, such as wait time, number of interactions, and handoffs. Track these as you…
  6. Drive change. Identify what most needs to change and rally your teams around these problems.
  7. Don’t forget to record the CX impact you’re having on those business measurements!

It’s the last part that will keep you out of that 1 in 4 at risk – showing how you’re actually impacting the business. And then bring that back to your CFO, so she can validate that you’re truly driving value.

Customer experience has a tremendous ability to impact your business – there’s no shortage of data to demonstrate that on a macro scale. But that doesn’t give you a blank check. You need to show your CX impact if you want to continue to drive change.

Ten B2B KPIs to Track Starting Now (none are NPS) – Employee-Rated and Survey Items

Yesterday, we talked about Business KPIs that you need to track to truly understand the value and cost of different clients. Unfortunately, not every important metric can be captured in your systems. Some require employee judgment to rate, for example client risk, number of contacts at the client, and potential. Others require clients to tell you about themselves, such as share of wallet, likelihood to remain a customer, and trust. We’ll discuss these items today.

First, let’s look at Employee-Rated Items:

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Ten B2B KPIs to Track, Starting Now (none are NPS) – Business KPIs

Measuring Customer Experience’s (CX) business impact is hard. It’s one of the biggest challenges in passing the CCXP exam. One reason is that CX pros are very customer-focused; we’re confident that if we just focus on customer needs, the ROI will take care of itself. Unfortunately, our business partners aren’t always so confident.

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Business and Customer Experience Metrics

If All Customers are Important, You have a Bad B2B Customer Experience

“When all customers are important…none will be.” – Syndrome from The Incredibles (slightly paraphrased)

Are all customers worth the same to your business? No! But odds are, your CX program doesn’t recognize this.

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Stop Bribing Your Employees for Good NPS Scores

We’re early in Customer Experience (CX) capability development, and I absolutely love it! We’re discovering the best practices that our successors will take for granted; “of course that’s how you do it.”

Unfortunately, being in this early stage means that some “best practices” aren’t. Some actually hinder the goal of improved CX – to create loyal customers who love your brand and come back time and again.

One “best practice” that can create a terrible customer experience is paying employees to achieve good NPS, or Customer Satisfaction, scores. This needs to stop.

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NPS Pop-Ups—Low-Cost, Yet Low-Quality

Jean Fasching, Lead Consultant

This is a guest post written by one of our very own Lead Consultants, Jean Fasching. 

A friend of mine who’s new to NPS research recently shared that she was frustrated with the response rate (less than 1% of those asked) from a B2B, NPS (Net Promotor Score) question recently added to her company’s website. Executives dictated the addition as a low-cost and efficiency method to get at NPS. So, to keep it simple, she had it added as a one-question pop-up for every “n” visitor to their home page.

She was frustrated at the low response rate, especially to a one-question survey—it was as simple as it could get, so what could she do to get more responses? As we chatted, I mentioned a low response rates (let’s say, below 3%) for the clear majority of website surveys is a common issue, and I’ve only seen good response rates (let’s say above 10% – 50%) using pop-up website surveys in a very few instances. Read more

Your CX Scorecard is Probably Measuring the Wrong Thing

“The purpose of a business is to create and keep a customer.” – Peter Drucker

I love that quote. In one short sentence, Drucker summarizes what a business – and customer experience (CX) – is all about. But despite that wisdom, companies continue to focus primarily on creating customers, often forgetting that keeping them is the way to organic growth. And when they do focus on keeping customers, the focus is all too often on trying to trap them – requiring a phone call to cancel (I’m looking at you, TiVo and Comcast), or requiring contracts that assess fees to leave (Comcast, you again).

Jeannie Bliss has been beating this drum for years. We need to listen to her. What matters is new customers minus attrition, plus how much those customers spend with you. Everything else is just window dressing. Read more

Customers + Bad Math = Worse Strategy 

There’s something that always bugged me about how people present their customer scores – whether satisfaction, NPS, Customer Effort, or anything else. 

There are really two primary approaches to this reporting: 

  1. Give an average (4.65 out of 5, for example) 
  1. Give the % of top box (5 out of 5, 9 or 10 out of 10) or Top-2 Box (4 or 5 out of 5) 

From what I can tell, nobody really thinks about this. They just do what’s traditional. If a vendor reports one way to one customer, they report this same way to ALL customers. As if everybody’s customers react the same way, and all points in the scale matter the same. 

But that’s not true.  Read more

Your business doesn’t really care if your customers are likely to recommend you 

And neither should you.  Read more

Are Your New Customer NPS Scores Low? Here’s Why

It’s not unusual for new customers to have lower scores than expected—but it can seem counterintuitive. After all, they just selected your company – why are they so low? You’ve gone through and removed barriers, but your customers aren’t showing the love.

It might not be what you’ve done. The problem may be their reference point.

The more time you spend in a company, the more your perspective shifts. We all try to maintain the “beginner’s mind,” where we see things as if they were fresh.

But here’s the thing. Your customers don’t really have a beginner’s mind, either. They don’t actually judge your experience on its own merits, but by a separate reference point – one you might be aware of.  Read more