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EVERYTHING YOU
WANTED TO KNOW
ABOUT NPS (BUT WERE
AFRAID TO ASK)
1/10/2016 Best Practices of Measurement and Execution
• Customer Feedback is a hot topic these days with several practices
of measurement.
• Our belief is that two key measurements can help transform your
business to a customer-centric organization.
• 80024Support.com has been instrumental in delivering technical
support that enables companies to make that critical pivot.
Everything you wanted to know about NPS (but were afraid to ask)
Page 1
Everything you wanted to know about NPS
(but were afraid to ask)
B E S T P R A C T I C E S O F M E A S U R E M E N T A N D E X E C U T I O N
ABSTRACT
Customer Feedback is talked about at some levels within almost every company in America. Executives speak
of improving the customer experience as a high priority. To aid in this, there are many disciplines of customer
feedback. Net Promoter Score (NPS) and Customer Satisfaction (CSAT) are among the favored approaches.
Our belief is that most businesses fall short of their potential because they concentrate too much on a score
and not enough time on engineering a customer-centric organization. We contend that a score is a starting
point and NOT and end point.
Customer feedback (in its many forms) provides valuable insight into the customer journey, their affiliation with
your brand and the operation of your business. By listening and understanding these dynamics, businesses can
truly differentiate themselves and create massive growth and ROI opportunities.
ACKNOWLEDGEMENTS
Tripp Kerr is Chief Operating Officer of 80024Support. Not only does Tripp bring
almost 20 years of designing and engineering support organizations but he also has an
extensive background in customer research. Tripp has executed customer research
studies in multiple fortune 500 companies that have enabled them to transform their
businesses and the markets they serve.
80024Support is an industry leading Technical Helpdesk service company. In business for almost 25
years, 80024Support has provided world-changing support to customers of many leading technology
brands . 80024Support brings a unique capability and expertise to these organizations allowing them to
better serve the needs of their constituents.
Everything you wanted to know about NPS (but were afraid to ask)
Page 2
A PRIMER ON METHODOLOGIES
Net Promoter Score (NPS)
Net Promoter Score (NPS) was first proposed as an effective measurement of customer loyalty in the Harvard
Business Review in 2003 by Fred Reicheld, a partner at US consulting firm Bain & Co. NPS asks customers to
score on a scale of 0 (very unlikely) to 10 (very likely) how likely they would be to recommend your company.
Those who score in the range of 0 to 6 are
Detractors; those who score 7 or 8 are
Passives; and those who score 9 or 10 are
Promoters. The NPS score is calculated by
subtracting the % of the sample who are
Detractors from the % who are Promoters.
So if 20% are Detractors, 30% are
Passives and 50% are Promoters the NPS
score is 50-20=30.
Reicheld maintained that NPS could be used as an effective predictor of growth because high scores on the
‘likelihood to recommend’ question were shown to correlate strongly with repurchases, referrals and other
actions that contribute to a company’s growth. For more insight into NPS you should read Reicheld’s book –
“The Ultimate Question 2.0”.
Customer Satisfaction (CSAT)
Customer satisfaction is a more traditional way of measuring a customer’s reaction to their experience
Typically; it is used with a 5 point. It deploys a format can be used in a wide range of questions. It lets you
investigate:
• Overall service experience – “How satisfied were you with your overall experience with Brand X?”
• Product – “How satisfied were you with Product Y?”
• Resolution – “How satisfied were you with the speed at which your issue was resolved?”
• Personnel – “How satisfied were you with the way our agent treated you?”
• Agent performance – “How satisfied were you with the knowledge of the agent you spoke to?”
Everything you wanted to know about NPS (but were afraid to ask)
Page 3
WHICH METHODOLOGY TO USE
Measurements such as CSAT and NPS have been developed to measure different aspects of customer
experience and perception: Effort and CSAT have an obvious role to play in gauging customer response to a
recent transaction or experience; NPS, recommending a brand, may take into account a much wider range of
experience than just a recent transaction.
Customer satisfaction – CSAT is best used when it is applied to a specific aspect of service.
Questions like ‘How satisfied were you that the call agent was friendly & helpful/had the knowledge to help
you/was able to resolve your query?’ can be used as the basis for measuring agent performance at
individual level and rewarding agents accordingly. Questions like ‘How satisfied were you with the time you
had to wait?’ can expose issues with process and provide quantified insight about what needs fixing.
Net Promoter Score – NPS is a simple way of gauging the strength of the relationship between a
customer and a brand. If someone is prepared to stake their own reputation with friends and family by
recommending a brand it means they are well connected to it. But, as a standalone measurement, it does not
provide valuable insight – you have to ask people to explain why they have given the score they have. That’s
what drives the insight and allows you to react appropriately.
Using Both Measurements Together --The key to getting the most out of any metric is to see it
as a signpost, an indicator of how your brand is performing over time. To do that you need both a consistent
measurement process and to be able to identify the reasons why people have given the score they have. By
measuring your key metric with the same question set, at the same point in the customer journey you will be
able to accurately measure changes over time or differences between teams. And with an open-ended
question you can swiftly identify why customers have given the scores they have. Armed with this information
you can address the issues that need addressing and improve service performance and your key metrics.
Transactional vs Relationship Measurement
We are often asked about the link between transactional and relationship surveys. First let’s clarify what we
mean, using NPS as an example of a metric that might be measured by relationship or transactional surveys:
Relationship NPS would typically be measured by a ‘point-in-time’ (quarterly or biannual) survey of a
representative sample of the client’s customer base. The NPS being measured is at a brand level (’top-down’)
and reflects all the experience that a customer has had with the brand. It also takes into account customers
who have had no recent contact with the brand.
Transactional NPS is measured through a continuous survey which generates feedback immediately or very
soon after an interaction between company and customer. Volumes are typically driven by the need to
provide a robust sample for the objectives of the survey (e.g. measuring performance at an agent level might
require 10-20 surveys per agent per month). The NPS being measured is focused on the customer’s recent
experience (‘bottom-up’) rather than the totality of the customer’s experience of the brand.
Everything you wanted to know about NPS (but were afraid to ask)
Page 4
Transactional Surveys are beneficial in that they provide:
• Immediacy – real-time feedback means you can fix issues swiftly or re-engage with dissatisfied customers
before they complain or spread negative word of mouth.
• Granularity – you can identify NPS at agent level and use it as an indicator of performance. This means you can
benchmark service levels, identify top performers, and clone best practice
• Relevance - you get a hard measure of NPS based on recent experience of the brand
• Tracking – you can see how your scores move in response to real-time events.
BENEFITS OF MEASUREMENT
The key benefit to measurement is that it allows your organization to transition to being customer-centric. By
getting valuable input from your customers, you can better tailor your business to their needs.
Rapid Response to Issues
Low scores allow you to immediately engage with customers to resolve lingering sources of dissatisfaction.
This is especially critical in the social-media age where a dissatisfied customer can tell millions about their
negative experience. In fact, quickly addressing a customer issue can yield a 300% improvement in likelihood
of promoting your business.
Prioritizing Improvements
Feedback from your customers can allow you to make changes within your organization. This feedback should
be reviewed for prevalence as well as severity of impact to your customers. Improvements typically fall into
three major categories of impact:
1. Changes to your product (Features, UI, design, etc.)
2. Changes to your processes (RMA process, ordering, employee empowerment, etc.)
3. Changes to people (accessibility, capabilities, knowledge)
To speed improvement, the right prioritization based on customer feedback provided maximum “bang-for-
the-buck”
Customer Point of View
Companies use surveys to map and identify process pain points across the customer journey. This feedback
allows them to plot the customer journey from a customer perspective, to identify where log-jams occur, to
understand the reasons why they happen and ways of improving the overall customer experience. Designing
Everything you wanted to know about NPS (but were afraid to ask)
Page 5
your product or service from a customer-centric point of view is key to aligning to expectations within your
constituent base.
Building Better Products
Listening to your customers allows you to design your products better. My responding to feature requests or
user interface issues, you can not only head off issues before they happen but you can drive stronger overall
satisfaction within your customer base.
Managing Customer Relationship
Feedback surveys can help to identify the channels that customers use to interact with a brand. Simple
questions about the number of times they have called or whether they went online first can be referenced with
NPS and effort scores to identify major frustrations in the access process.
ROI OF CUSTOMER MEASUREMENT
NPS has been proven to be a single, high-correlation measurement to a company’s ability to grow. Across
multiple industries, this measurement has proven to be a reliable indicator of future growth. According to
extensive research, companies with leading NPS scores grow at almost 2x the rate of their industry peers.
ROI can be calculated in many ways. We believe it is a sum-total approach that truly derives your return
from becoming a Customer-centric company:
1. Enhanced sales / easier marketing through customer referrals and testimonial
2. Strong positive Social representation of your brand
3. Faster speed to market with impactful products
4. Share of Wallet / Share of market against lesser-performing competitors.
5. Lower cost of support through root cause analysis
6. Freedom of internal teams to think / act more strategically
7. Greater brand equity
Everything you wanted to know about NPS (but were afraid to ask)
Page 6
USEFUL LINKS:
www.80024support.com – Corporate Website
www.blog.80024support.com – Further Blog Postings on NPS and Customer Experience
https://www.facebook.com/80024support/ - Facebook
https://twitter.com/80024Support - Twitter
https://www.linkedin.com/company/80024supportcom - LinkedIn
ABOUT 80024SUPPORT
80024Support is a leading provider of Outsourced Technical Support Services. Our organization is built
solely around delivering exceptional customer experiences that drive NPS for our valued customers.
80024Support’s outsourcing services are used by leading businesses to:
1. Stabilize Customer Experiences to deliver Quality of Service and Drive Satisfaction
2. Give organizations the headroom to think and act differently about their customers
3. Create a capability that companies can leverage to strategically pivot to customer-centric
organizations.
4. Pivot organizations for scalable growth based on market success.
CONTACT US
www.80024Support.com
(800) 24-Support
5625 Ruffin Road, Suite 220
San Diego, CA 92123
rdrbsales@80024support.com

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80024 support whitepaper nps

  • 1. EVERYTHING YOU WANTED TO KNOW ABOUT NPS (BUT WERE AFRAID TO ASK) 1/10/2016 Best Practices of Measurement and Execution • Customer Feedback is a hot topic these days with several practices of measurement. • Our belief is that two key measurements can help transform your business to a customer-centric organization. • 80024Support.com has been instrumental in delivering technical support that enables companies to make that critical pivot.
  • 2. Everything you wanted to know about NPS (but were afraid to ask) Page 1 Everything you wanted to know about NPS (but were afraid to ask) B E S T P R A C T I C E S O F M E A S U R E M E N T A N D E X E C U T I O N ABSTRACT Customer Feedback is talked about at some levels within almost every company in America. Executives speak of improving the customer experience as a high priority. To aid in this, there are many disciplines of customer feedback. Net Promoter Score (NPS) and Customer Satisfaction (CSAT) are among the favored approaches. Our belief is that most businesses fall short of their potential because they concentrate too much on a score and not enough time on engineering a customer-centric organization. We contend that a score is a starting point and NOT and end point. Customer feedback (in its many forms) provides valuable insight into the customer journey, their affiliation with your brand and the operation of your business. By listening and understanding these dynamics, businesses can truly differentiate themselves and create massive growth and ROI opportunities. ACKNOWLEDGEMENTS Tripp Kerr is Chief Operating Officer of 80024Support. Not only does Tripp bring almost 20 years of designing and engineering support organizations but he also has an extensive background in customer research. Tripp has executed customer research studies in multiple fortune 500 companies that have enabled them to transform their businesses and the markets they serve. 80024Support is an industry leading Technical Helpdesk service company. In business for almost 25 years, 80024Support has provided world-changing support to customers of many leading technology brands . 80024Support brings a unique capability and expertise to these organizations allowing them to better serve the needs of their constituents.
  • 3. Everything you wanted to know about NPS (but were afraid to ask) Page 2 A PRIMER ON METHODOLOGIES Net Promoter Score (NPS) Net Promoter Score (NPS) was first proposed as an effective measurement of customer loyalty in the Harvard Business Review in 2003 by Fred Reicheld, a partner at US consulting firm Bain & Co. NPS asks customers to score on a scale of 0 (very unlikely) to 10 (very likely) how likely they would be to recommend your company. Those who score in the range of 0 to 6 are Detractors; those who score 7 or 8 are Passives; and those who score 9 or 10 are Promoters. The NPS score is calculated by subtracting the % of the sample who are Detractors from the % who are Promoters. So if 20% are Detractors, 30% are Passives and 50% are Promoters the NPS score is 50-20=30. Reicheld maintained that NPS could be used as an effective predictor of growth because high scores on the ‘likelihood to recommend’ question were shown to correlate strongly with repurchases, referrals and other actions that contribute to a company’s growth. For more insight into NPS you should read Reicheld’s book – “The Ultimate Question 2.0”. Customer Satisfaction (CSAT) Customer satisfaction is a more traditional way of measuring a customer’s reaction to their experience Typically; it is used with a 5 point. It deploys a format can be used in a wide range of questions. It lets you investigate: • Overall service experience – “How satisfied were you with your overall experience with Brand X?” • Product – “How satisfied were you with Product Y?” • Resolution – “How satisfied were you with the speed at which your issue was resolved?” • Personnel – “How satisfied were you with the way our agent treated you?” • Agent performance – “How satisfied were you with the knowledge of the agent you spoke to?”
  • 4. Everything you wanted to know about NPS (but were afraid to ask) Page 3 WHICH METHODOLOGY TO USE Measurements such as CSAT and NPS have been developed to measure different aspects of customer experience and perception: Effort and CSAT have an obvious role to play in gauging customer response to a recent transaction or experience; NPS, recommending a brand, may take into account a much wider range of experience than just a recent transaction. Customer satisfaction – CSAT is best used when it is applied to a specific aspect of service. Questions like ‘How satisfied were you that the call agent was friendly & helpful/had the knowledge to help you/was able to resolve your query?’ can be used as the basis for measuring agent performance at individual level and rewarding agents accordingly. Questions like ‘How satisfied were you with the time you had to wait?’ can expose issues with process and provide quantified insight about what needs fixing. Net Promoter Score – NPS is a simple way of gauging the strength of the relationship between a customer and a brand. If someone is prepared to stake their own reputation with friends and family by recommending a brand it means they are well connected to it. But, as a standalone measurement, it does not provide valuable insight – you have to ask people to explain why they have given the score they have. That’s what drives the insight and allows you to react appropriately. Using Both Measurements Together --The key to getting the most out of any metric is to see it as a signpost, an indicator of how your brand is performing over time. To do that you need both a consistent measurement process and to be able to identify the reasons why people have given the score they have. By measuring your key metric with the same question set, at the same point in the customer journey you will be able to accurately measure changes over time or differences between teams. And with an open-ended question you can swiftly identify why customers have given the scores they have. Armed with this information you can address the issues that need addressing and improve service performance and your key metrics. Transactional vs Relationship Measurement We are often asked about the link between transactional and relationship surveys. First let’s clarify what we mean, using NPS as an example of a metric that might be measured by relationship or transactional surveys: Relationship NPS would typically be measured by a ‘point-in-time’ (quarterly or biannual) survey of a representative sample of the client’s customer base. The NPS being measured is at a brand level (’top-down’) and reflects all the experience that a customer has had with the brand. It also takes into account customers who have had no recent contact with the brand. Transactional NPS is measured through a continuous survey which generates feedback immediately or very soon after an interaction between company and customer. Volumes are typically driven by the need to provide a robust sample for the objectives of the survey (e.g. measuring performance at an agent level might require 10-20 surveys per agent per month). The NPS being measured is focused on the customer’s recent experience (‘bottom-up’) rather than the totality of the customer’s experience of the brand.
  • 5. Everything you wanted to know about NPS (but were afraid to ask) Page 4 Transactional Surveys are beneficial in that they provide: • Immediacy – real-time feedback means you can fix issues swiftly or re-engage with dissatisfied customers before they complain or spread negative word of mouth. • Granularity – you can identify NPS at agent level and use it as an indicator of performance. This means you can benchmark service levels, identify top performers, and clone best practice • Relevance - you get a hard measure of NPS based on recent experience of the brand • Tracking – you can see how your scores move in response to real-time events. BENEFITS OF MEASUREMENT The key benefit to measurement is that it allows your organization to transition to being customer-centric. By getting valuable input from your customers, you can better tailor your business to their needs. Rapid Response to Issues Low scores allow you to immediately engage with customers to resolve lingering sources of dissatisfaction. This is especially critical in the social-media age where a dissatisfied customer can tell millions about their negative experience. In fact, quickly addressing a customer issue can yield a 300% improvement in likelihood of promoting your business. Prioritizing Improvements Feedback from your customers can allow you to make changes within your organization. This feedback should be reviewed for prevalence as well as severity of impact to your customers. Improvements typically fall into three major categories of impact: 1. Changes to your product (Features, UI, design, etc.) 2. Changes to your processes (RMA process, ordering, employee empowerment, etc.) 3. Changes to people (accessibility, capabilities, knowledge) To speed improvement, the right prioritization based on customer feedback provided maximum “bang-for- the-buck” Customer Point of View Companies use surveys to map and identify process pain points across the customer journey. This feedback allows them to plot the customer journey from a customer perspective, to identify where log-jams occur, to understand the reasons why they happen and ways of improving the overall customer experience. Designing
  • 6. Everything you wanted to know about NPS (but were afraid to ask) Page 5 your product or service from a customer-centric point of view is key to aligning to expectations within your constituent base. Building Better Products Listening to your customers allows you to design your products better. My responding to feature requests or user interface issues, you can not only head off issues before they happen but you can drive stronger overall satisfaction within your customer base. Managing Customer Relationship Feedback surveys can help to identify the channels that customers use to interact with a brand. Simple questions about the number of times they have called or whether they went online first can be referenced with NPS and effort scores to identify major frustrations in the access process. ROI OF CUSTOMER MEASUREMENT NPS has been proven to be a single, high-correlation measurement to a company’s ability to grow. Across multiple industries, this measurement has proven to be a reliable indicator of future growth. According to extensive research, companies with leading NPS scores grow at almost 2x the rate of their industry peers. ROI can be calculated in many ways. We believe it is a sum-total approach that truly derives your return from becoming a Customer-centric company: 1. Enhanced sales / easier marketing through customer referrals and testimonial 2. Strong positive Social representation of your brand 3. Faster speed to market with impactful products 4. Share of Wallet / Share of market against lesser-performing competitors. 5. Lower cost of support through root cause analysis 6. Freedom of internal teams to think / act more strategically 7. Greater brand equity
  • 7. Everything you wanted to know about NPS (but were afraid to ask) Page 6 USEFUL LINKS: www.80024support.com – Corporate Website www.blog.80024support.com – Further Blog Postings on NPS and Customer Experience https://www.facebook.com/80024support/ - Facebook https://twitter.com/80024Support - Twitter https://www.linkedin.com/company/80024supportcom - LinkedIn ABOUT 80024SUPPORT 80024Support is a leading provider of Outsourced Technical Support Services. Our organization is built solely around delivering exceptional customer experiences that drive NPS for our valued customers. 80024Support’s outsourcing services are used by leading businesses to: 1. Stabilize Customer Experiences to deliver Quality of Service and Drive Satisfaction 2. Give organizations the headroom to think and act differently about their customers 3. Create a capability that companies can leverage to strategically pivot to customer-centric organizations. 4. Pivot organizations for scalable growth based on market success. CONTACT US www.80024Support.com (800) 24-Support 5625 Ruffin Road, Suite 220 San Diego, CA 92123 rdrbsales@80024support.com