Net Promoter Driving loyalty in lean times

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Daniela Newton
5 years ago
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1 Net Promoter Driving loyalty in lean times

3 The Net Promoter Score How likely is it that you would recommend [Company XYZ] to a friend or colleague? Net Promoter, NPS, and Net Promoter Score are trademarks of Satmetrix Systems, Inc., Bain & Company, Inc., and Fred Reichheld. Satmetrix Presentation June Satmetrix, Inc. All rights reserved 3

The Growth of Net Promoter Research Satmetrix Systems collaborate with Fred Reichheld, Bain & Company HBR: The One Number You Need To Grow Best Practices Net Promoter discipline Incorporated into our

4 The Growth of Net Promoter Research Satmetrix Systems collaborate with Fred Reichheld, Bain & Company HBR: The One Number You Need To Grow Best Practices Net Promoter discipline Incorporated into our solutions Industry Adoption >15,000 subscribers to netpromoter.com 1,000s of conference & certification attendees Best practice book Satmetrix Presentation June Satmetrix, Inc. All rights reserved 4

5 Why the recommend question? Head: Services Features Price Heart: They know me They value me, They listen to me They share my values 4What we tried:- 4Satisfaction? 4Intend to buy more? 4Deserve loyalty? 4Would recommend? 4Really care? Satmetrix Presentation June Satmetrix, Inc. All rights reserved 5

longer Spend more Refer others Share feedback

7 Word of mouth behaviour Promoters 9-10 Will give around 7 good references It takes 5 positives to make a new customer Passives7-8 Detractors 0-6 Will put word out to 8 others Each negative comment neutralises 7 positives Do the maths... Satmetrix Presentation June Satmetrix, Inc. All rights reserved 7

8 Credit cards: Promoters have higher value 25,000 Total Customer Value B2C Credit Cards Example 20,000 $3,966 Customer Spend ($) 15,000 10,000 5,000 0 $13,912 Detractor $17,319 Average Customer $19,786 Promoter Positive WOM Negative WOM Current Spend (average) -5,000 -$7,690-10,000 Source: Satmetrix 2010 WOM B2C Credit Card Whitepaper Satmetrix Presentation June Satmetrix, Inc. All rights reserved 8

Banking: Promoters own more products and refer more often

Case Study: Virgin Media Satmetrix Presentation

Improve the customer experience and reduce churn by 20%

13 Making the right choices for success Metric Research Score Outside the core strategy Finance always wins Move the metric Discipline Operational Business outcome Central to the strategy Customer sometimes wins Create Promoters Satmetrix Presentation June Satmetrix, Inc. All rights reserved 13

Smart sequencing -up the spiral Innovation bottom

success Strategic insights support big bets

gambit: change Holistic plan for customer

in place Processes implemented for data quality

Priority around frontline deployment and quick

14 Smart sequencing -up the spiral Innovation bottom up and top down Cultural rewards reinforce success Strategic insights support big bets Economic proof points Strong leadership opening gambit: change Holistic plan for customer strategy and organisation Right governance team in place Processes implemented for data quality Relentless communication and clear accountability Priority around frontline deployment and quick wins Satmetrix Presentation June Satmetrix, Inc. All rights reserved 14

15 Key to Success is Closing the Loopat the Three Levels Establish customer-centric culture Use feedback in strategic decisions Reinforce in communications Exec Neutralise detractors Learn to create promoters Improve relationships Management Front Line Improve cross-functionally Manage performance Share best practices Satmetrix Presentation June Satmetrix, Inc. All rights reserved 15

16 and Communication To Customers Personalised Messages CEO letter Executive champion face-to-face meetings or calls Mass Communications Annual report Newsletters / magazines Advertising Blogs and online communities Customer conferences or advisory groups To Employees Company-wide CXO webcast Internal events Internal newsletter / intranet Function or Department-level Signage to create visibility Regular management reports Department-level meetings Team or Individual-level Team meetings Coaching and performance reviews Satmetrix Presentation June Satmetrix, Inc. All rights reserved 16

18 Getting the basics right is the foundation on which to differentiate Differentiators: Creating the wowfactor Loyalty Ordinary services delivered exceptionally Exceptional services/features delivered well Satisfaction Product meets customer needs Product works as expected Problems are resolved as expected The basics: Eliminating defects Source: Bain & Company Satmetrix Presentation June Satmetrix, Inc. All rights reserved 18

19 Requirements for a true NPS system Systematically categorize customers into promoters, passives, or detractors for each key customer segment (trustworthy and granular data) Create closed-loop processes so that the right employees will directly investigate the root causes that drive customers into these categories Executives make the creation of more promoters and fewer detractors a top priority Satmetrix Presentation June Satmetrix, Inc. All rights reserved 19

20 Successful Net Promoter programmes Multi-dimensional:- NPS measurement Holistic across the business: Executive, Management, Front-line employees Integration with core business processes and operational systems Closing the loop Trustworthy data Communications Satmetrix Presentation June Satmetrix, Inc. All rights reserved 20

21 Customer loyalty management (CLM) Customer recommendations drive growth Public relations develops profile and manages reputation Net Promoter Score enables loyalty measurement PR approach perfect for customer communications as well as media relations Satmetrix Presentation June Satmetrix, Inc. All rights reserved 21

Improving Customer Satisfaction

Improving Customer Satisfaction Using an NPS Methodology with Ascribe Purpose Net Promoter Score (NPS) is a widely adopted management tool used to assess the loyalty of customer relationships 1. Here we