Building a Loyalty! Robot Adam Dorrell CEO CustomerGauge 6 Nov 2013 Net Promoter, NPS, and Net Promoter Score are trademarks of Satmetrix Systems, Inc., Bain & Company, and Fred Reichheld.
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Net Promoter System! Standardized methodology for customer loyality measurement. Jak pravděpodobné je že nás na základě Vaší poslední zkušenosti doporučíte Vašim kolegům a známým? Výpočet skóre Kritici Pasivní Propagátoři 0 1 2 3 4 5 6 7 8 9 10 NPS % propagátorů = (9 a 10) - % kritiků (0 až 6) Určitě ne Určitě ano SCORE + COMMENT Key advantages of NPS: Single value representing customer loyalty. Easy to compare in regional and industry context. Becoming standard indicator for Fortune 1000 companies Best companies / services: NPS > 75 (ie.apple, Amazon) Well run companies / services: NPS > 40 (ie. Sony, ING) NPS < 40 = low loyalty threatening growth without significant investments. Net Promoter, NPS and Net Promoter Score are trademarks of Satmetrix Systems, Inc., Bain & Company, and Fred Reichheld
The Net Promoter Score (NPS) Just one number Measure every transaction: Would you recommend us? Real time results Act on customer comments Change can happen monthly Download from: http://customergauge.com/wordpress/?p=42
Factors Net Promoter adoption Fear Factor SolutionS How to do it? Many web resources, books courses NPS is open source Lack of tools or resource Start small MailChimp + SurveyMonkey + Excel, plus some work Budget from EUR 50 Looks like hard work ($cost) for customer service Spread the load, make it daily routine. Rescuing customers = profit NOT cost No CRM data Start now! Use %Engagement as a metric AUTOMATE ON TRANSACTIONS Culture Change for company Communicate from top of company. Spread good news
Just One Question: How it looks Example on smart phone (50% responses) Invitation Survey Page 1 (NPS) Survey Page 2 (Comment and action)
Results
Comments
Lesson in Inequalities 95% of Guinness consumed by 5% of customers 5% OF GUINNESS DRINKERS Pareto Principle (80-20 Rule) 80% of revenue from 20% of customers 95% GUINNESS volume Source: Malcolm McDonald, CIM
Segment by value Customer Segmentation Value (spend, profit) $$$ 50% revenue $ 50% revenue Hi-spending customers LO-spending customers
Tool with real customer numbers 8% Customers 42% Sales Average Value 1693 92% Customers 58% Sales Average Value 199
Segment by Loyalty Customer Segmentation DETRACTORS 0 6 Promoters 9-10 Also PASSIVE 7-8 Detractors Promoters LOYALTY (Net promoter score)
Tool Promoters +60% over average sale value 14% Sales Average Value 415 22% Sales Average Value 510 +60% 64% Sales Average Value 274
Value & Loyalty Matrix Customer Segmentation Value (spend, profit) RESCUE REWARD LOWER PRIORITY Detractors Promoters Take actions to Rescue Key customers IN DANGER OF defecting & Reward Key customers who can help grow sale LOYALTY (Net promoter score)
Tool 7% Sales 1% customers 1700 13% Sales 2% customers 1900 23% Sales 5% customers 1500
Rescue How long to get back to a customer? You need a process Measure it Best clients <48hours Now is when customers want it A rescued customer is more loyal! Prioritise to top customers RESCUE
Survey Follow Up With Follow up Not followed up -5 34 72-29 23 69-100 100 NPS -100 100 NPS Workflow Response Time (hours) 6 201 (9 days) 506 (21 days) 0 720 How to boost your NPS: Follow up open cases! 11 points difference!
Engage Reach out to customers who are not responding You should be at 25%+ response rate Best clients at 50%+ Engaged customers: 2x value of non-responses Tell them what you are doing with feedback Prioritise to top customers ENGAGE
Revenue Accelerator: Email Engine 8% customers Dear Customer, Thank you for saying you would be likely to recommend us. Email sent to top promoters 2.5% of customers = 10,000 Emails sent REWARD Here is a gift from us for you: Coupons sent by email to approx 10,000 customers. Typical campaign, spring 2013 $25 XYZ122333444 And something for 2 friends so they can try us too. $25 XYZ122333666 $25 XYZ122333999 Existing customer (upsell) New Customers (referral)
Building the Robot Automate surveying Respond to detractors quickly Thank promoters Communicate to customers RESCUE REWARD ENGAGE Working In real-time! Send comments to the right people in business
What s it worth? Rule of Thumb: Moving detractors to promoters really has impact Each 1% increase in NPS = 1% increase in revenue Most clients can move 1% NPS a month CustomerGauge resource sheet: Impact of Improving Net Promoter Scores on Average Order Value and overall sales
Summary Identify your most valuable returning customers Continually ask for feedback using Net Promoter Score methodology Rescue & Reward the most important customers Automate the process wherever possible: build a Loyalty Robot Make it part of your company s DNA use the best tools out there! Thank you
THANK YOU Adam Dorrell Twitter: @customergauge