Net Promoter System

Accessing the full benefits of an NPS System requires the organization to view NPS as a long-term strategy commitment in which the adjustments are made across the entire company. It is a complete overhaul, but one proving to be the greatest asset to a successful business in this day and age. The system is about more than improving an occasional CX; it is not a short-term or intermittent project. It requires executive commitment, dedicated leadership, widespread acceptance, financial investment, and ongoing review and flexibility to adapt as necessary. This is not an initiative that will be wrapped up in a few months but rather an ongoing process that will become an integral and pervasive part of how you do business. 

So, why NPS? Simply put, data shows that leading brands who made this commitment and adapted their organizational structure tend to grow at more than twice the rate of their competitors. 

The benefit is well worth the organization-wide commitment and strategy overhaul. Business thrives on growth, so aligning the NPS System to corporate objectives is key to ensuring its successful adaption. Any successful CX initiative understands the value of the effort and the investment that it requires. it is important to set the right expectations at all levels in the organization, meaning applying the right benefit to the right level of management and team. 

At the highest level, the C-Suite, management cares about business growth and alignment. Within management and operations, priorities are still growth-focused, but revolve more around what can be controlled in this environment i.e. keeping customers satisfied and controlling costs. 

Business growth can be achieved by boosting revenue from products and services or by increasing the profitability of the operation by minimizing costs. Revenue increases usually come from one of the following four sources:  

1. New customers are interested in buying your products and services because of the advertising campaign you run.
2. Your existing customers spend more on existing products and services.
3. Your existing customers decide to purchase other products and services from your catalog. Their pleasant current experience with the brand is perceived value and in returning increases customer loyalty. 
4. Those existing customers tell their family and friend to buy from the brand, which converts them to new customers.

According to Word of Mouth Marketing Statistics from 2020, people are four times more likely to buy a product or work with a business when referred by friends. [1] Therefore, keeping customers happy and focusing on customer loyalty is not just important for existing business but for future business as well. 

The Q2 2020 Economics of Net Promoter Score (NPS) Benchmark study by Qualtrics XM Institute found that NPS is strongly correlated with the quality of customer experience a company delivers and that promoters are significantly more likely than passives or detractors to exhibit all three key loyalty behaviors (purchase more, trust, forgiveness) – to name a few examples by vertical. 

● Banking: Promoters are 

• 4.3x more likely to purchase more from a bank 
• 4.6x more likely to trust a bank
• 4.8x more likely to forgive a bank if it makes a mistake. 

● Health Insurance: promoters are 

• 3.7x more likely to purchase more from a health insurer 
• 4.5x more likely to trust a health insurer
• 4.3x more likely to forgive a health insurer for a mistake 

● Software: promoters are 

• 3.8x more likely to purchase more from a software firm 
• 4.4x more likely to trust a software firm 
• 3.8x more likely to forgive a software firm if it makes a mistake 

Key Takeaways:

1. The system drives growth, not the score itself.
2. The results of the metric drives improvement and alignment. 
3. Customers recommend the brand when they receive value from their relationship with the brand. 

The core benefit of the system is driving growth. But there are three indispensable benefits of the system as well:

• Bringing alignment among departments and setting prioritization
• Driving improvements across the organization
• Increasing customer value

Some top brands that reap the reward of this system include Amazon, First Republic bank, Apple Retail, and Intuit. Despite minor hiccups or inconveniences, customers are staunchly loyal to these brands.

Successful systems must be updated every 18 to 24 months as changes continually occur in the customer base, market, employees, management, and processes. 

Updates will ensure system robustness, put your customer at the center of everything you do, and continuously drive improvements and actions on their behalf.

As Bruce Temkin sums it up, "Promoters are significantly more loyal, so most businesses would do well to create promoters and decrease detractors." Does your NPS System creating more promoters? Schedule your free one hour call with us at info@xperiente.com.