What do Qantas, Lego, Vodafone, Apple and The Icehouse have in common? All of them are organisations which use NPS to gauge client and customer satisfaction.
Used by millions of businesses around the world, NPS stands for Net Promoter Score and is held up as the gold standard customer experience metric. First developed in 2003 by Bain and Company, it requires a score between -100 and +100 as a single measure of customer experience success, with a score closest to 100 as the most desirable outcome.
Survey Monkey assessed the NPS of more than 150,000 organisations and discovered that the average score is +32, while ‘the upper quartile of organisations (or the top 25% of performers) have an NPS of +72 or higher.’
The Icehouse score
With a score of 70+ considered ‘world-class’, The Icehouse is very proud to boast an NPS in 2021 for its business coaching of 79, it’s workshops 93 and its long format programmes 74.
Used in customer experience programmes, NPSs seeks to measure customer satisfaction, perception and loyalty based on one simple question: ‘How likely is it that you would recommend [Organisation/Product/Service] to a friend or colleague?’
It has variations on a theme… eCommerce sites, for example, might be better asking, ‘Now that you’ve received your [product], how likely are you to recommend [company name] to a friend or colleague? (0-10 ).’
Regular NPS surveying enables follow-up questions which can help move with trends, capture important information around specific products and services, and reassures organisations that they have good processes in place. It also enables businesses to move quickly if things aren’t going so well.
The misconception is to believe you can’t gauge a lot from one question, but that’s not the case. NPS enables business to establish best-practice across a surprisingly high number of data points – and capture ‘moments in time’. For example, if you score well you can cross reference with what you were doing at the time. Were you trialling a new courier company? Did it coincide with the roll out of your new customer-facing chatbot?
It also helps answer some difficult questions – is your product/service up to the consumer’s standard? Are your peripheral processes around it (like back office experience) letting you down? Could you be losing market share to another competitor? What are they doing well?
As Perceptive points out, ‘One of the key benefits [of NPS] is that it measures the likelihood of new and repeat business. This measure is useful for forecasting business growth, cash-flow, as well as assess the health of your brand and overall customer satisfaction.’
How much business from referrals?
Approximately 65% of new business comes from referrals, states Retently, ‘making word of mouth your most valuable marketing channel. Since you don’t have the multi-million dollar marketing budget of a Fortune 1000 brand, maximising referrals from happy clients is an excellent way to bring in new clients and fuel your service business’s growth.’
SMEs like NPS because it helps them get quick responses to current trends, it’s a low-cost and standard way of measuring immediate customer experience, and you can track changes over time. As it’s so easy to implement NPS questions you can trigger them as often as you like, such as very quarter, to measure ongoing success of a specific department.
A strong NPS reflects that your business is doing everything right – from the initial front-line staff to the product/service, marketing, and customer support. It also enables you to assess what’s not going so well, and make changes accordingly.
The Icehouse uses NPS to gauge the effectiveness of its programmes, workshops and coaching and advisory services so it can commit to continuous rounds of refinement, improvement, and relevancy.
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