Leveraging NPS Survey Best Practices to Drive Customer Satisfaction
We promise, by the end of this article, you will know NPS is not only a vanity metric and you will have learned enough NPS survey best practices to know how to use it for your business.
But first, picture this: it’s 2008 and two broke San Francisco roommates, Brian and Joe, are trying to make rent. They came up with the idea to rent air mattresses in their apartment during a design conference. And just like that, AirBnb was born.
Fast forward a few years and AirBnb is getting off but has yet to become a global phenomenon, offering travelers unique and affordable accommodation options all over the world.
So how did they get there?
A big part of their success can be attributed to the way they leveraged Net Promoter Score best practices in the early days, to measure customer satisfaction and turn feedback into revenue.
When Airbnb first started, they knew that their business model was centered around creating trust between hosts and guests.
But how could they measure that trust? By asking guests how likely they were to recommend Airbnb to a friend, they could get a clear idea of how well they were doing in terms of customer satisfaction.
Now, AirBnb didn’t stop at just measuring and surveying NPS. They also used it to improve their business.
When they received feedback that their website was difficult to navigate, they made changes to improve the user experience.
When guests complained about cleanliness issues, they implemented stricter standards for hosts to follow.
The result? AirBnb’s Net Promoter Score skyrocketed, going from 20 to 70 in just a few years. And that increase translated directly into revenue.
Because the company knew that customers who rated AirBnb as a 9 or 10 on the NPS scale were 2.6 times more likely to book again than those who rated them as a 6 or below.
And the company kept using this system to do to stay ahead of the competition in several other ways. Will talk more about that later in this article.
But enough stories for now.
Let’s take a step back for an instant to understand where NPS comes from!
What is Net Promoter Score in a few words?
NPS stands for Net Promoter Score, and it's a customer loyalty metric developed by Fred Reichheld, Bain & Company, and Satmetrix.
The idea behind NPS is that the more loyal a customer is, the more likely they are to recommend a company or product to others.
NPS is based on a simple question: "How likely are you to recommend this company/product to a friend or colleague?" Customers are asked to rate their likelihood of recommending on a scale from 0 to 10.
Now, here's where it gets interesting. Based on their responses, customers are classified into one of three categories.
The first category is promoters, who score the company or product a 9 or 10.
These customers are considered loyal and are likely to recommend the company to others.
The second category is passives, who score the company or product a 7 or 8.
These customers are satisfied but not necessarily loyal, and they may not go out of their way to recommend the company.
Finally, there are detractors, who score the company or product a 0 to 6.
These customers are unhappy and may even discourage others from doing business with the company.
To calculate the NPS score, you subtract the percentage of detractors from the percentage of promoters.
This gives you a score ranging from -100 to 100. A score of 100 means that every customer is a promoter, while a score of -100 means that every customer is a detractor.
Let's explore some examples by examining the best practices of three selected companies.
3 proven strategies of companies using NPS survey Best practices
Have you noticed how hard and costly it has become for businesses to attract new customers in today's highly competitive market?
And it's a real struggle to keep them hooked too. Solutions that won’t demonstrate great added value will be cut off in the current economical landscape.
That's why if you're planning to expand your business in 2023, it's crucial to prioritize customer satisfaction and loyalty.
One interesting way to achieve that is by using NPS (Net Promoter Score) measurement. It lets you assess how likely your customers are to recommend your product or service, giving you a clear idea of their satisfaction level.
Happy customers are more likely to stay, recommend your solution or buy more.
Moreover, social media and online reviews have made word-of-mouth marketing more critical than ever.
Positive feedback from satisfied customers can give your business a significant boost, while ignoring negative feedback can quickly hurt your reputation.
Especially in a world where bad news travels faster than good ones.
Ready to learn how successful companies have grown their business with NPS?
Check out these three examples!
NPS to identify your promoters: The AirBnB example
Have you ever recommended a product or service to a friend or family member?
Maybe it was a new restaurant you tried or a cool gadget you found online.
You probably did it because you had a positive experience and wanted to share it with someone else, right?
Well, companies can use this NPS survey to their advantage by identifying their most loyal customers, or "promoters," and leveraging their positive feedback to generate referrals and build brand loyalty.
And that's exactly what Airbnb did!
By using Net Promoter Score, Airbnb was able to identify its promoters and encourage them to spread the word about their platform.
They did this by offering referral incentives and running targeted marketing campaigns highlighting their positive reviews and customer satisfaction ratings.
This strategy not only helped Airbnb acquire new customers at a lower cost, but it also helped them build a loyal community of users who were more likely to book with them again in the future.
And it all started with simply identifying their most satisfied customers and leveraging their positive feedback to build brand loyalty.
So, if you're a business owner, a product manager, or a marketer, you should know that NPS is a great way of identifying your promoters and leveraging their positive feedback.
NPS to listen to detractors: The DropBox Example
In the early 2000s, a startup called Dropbox was revolutionizing the way people stored and shared files online.
However, as the company grew, the team started to notice that their customer retention rates were dropping.
Dropbox's leadership team was baffled.
They had built a great product that was easy to use and affordable, so why were customers leaving?
That's when they decided to implement the Net Promoter Score (NPS) survey.
They sent out a simple email asking customers, "How likely are you to recommend Dropbox to a friend or colleague?"
The response was overwhelming, and not in a good way.
Dropbox discovered that a significant portion of its customer base were detractors, meaning they were unlikely to recommend the product to others.
By diving deeper into the feedback provided by detractors, Dropbox identified several pain points.
Customers were frustrated with the limited storage space, slow syncing speeds, and lack of features like file versioning.
The Dropbox team took this feedback seriously and implemented changes to address these concerns. They increased the amount of free storage available to users, optimized their syncing technology, and added new features like file versioning and collaboration tools.
As a result, Dropbox saw a significant improvement in its NPS score and customer retention rates.
By listening to their detractors and taking action to address their concerns, Dropbox was able to turn things around and build a loyal customer base that continues to use the service to this day.
NPS to track client’s sentiments variations: The Zappos example
Let me tell you more about the online shoe and clothing retailer, Zappos next. They're not your average e-commerce site - they're known for their exceptional customer service.
And guess what? NPS played a major role in helping them achieve this reputation.
After Zappos was acquired by Amazon in 2008, they were able to utilize Amazon's resources to improve their customer experience initiatives.
And one of the first things they did was create a team dedicated solely to tracking NPS and other customer satisfaction metrics.
By keeping a close eye on their Net Promoter Score over time, Zappos could pinpoint areas that needed improvement.
For example, they noticed that customers who had to wait longer on the phone for support gave them lower NPS scores.
With this insight, Zappos decided to invest in more customer service resources, like additional staff and training programs.
And the results speak for themselves. Today, Zappos is known for exceptional customer service and has one of the highest NPS in the industry.
All because they consistently tracked NPS and made data-driven decisions to improve their overall customer experience.
This just goes to show how powerful NPS can be in measuring customer satisfaction and loyalty, and helping companies take the necessary steps to improve their customer experience.
By keeping track of NPS over time, companies like Zappos managed to identify areas for improvement, take action to address customer concerns, and ultimately build stronger customer loyalty and retention.
How else can you use the NPS survey?
Still not convinced? Let me go one step further then.
Because Net Promoter Score is a powerful tool for turning user feedback into revenue and improving customer satisfaction.
It isn't just a one-trick pony or a vanity metric.
Aside from the benefits we already talked about, there are several other ways companies can use them to their advantage.
Like using NPS as benchmarking. By comparing their NPS score to industry benchmarks and their competitors' scores, companies can get a better understanding of how they stack up in terms of customer satisfaction and loyalty. This can help them identify areas where they need to improve to stay competitive in the market.
The promoter score can also help companies prioritize areas of improvement by identifying which aspects of the customer experience are most important to their customers. For example, a company with a high NPS score may still have room for improvement in areas that are particularly important to their customers, such as the ease of use of their products or personalized support.
In addition, an NPS tool can be used to track the impact of marketing campaigns and product launches on customer sentiment. By measuring it before and after these initiatives, companies can determine how effective they are in driving customer satisfaction and loyalty.
Overall, Net Promoter Score is a metric that provides companies with valuable insights into customer sentiment. It can help them make data-driven decisions to improve the customer experience, increase customer loyalty and retention, and ultimately drive revenue growth.
By identifying promoters and detractors, digital companies can leverage positive feedback to generate referrals and address concerns to improve their products and customer experience.
ProdCamp offers a Net Promoter Score survey module to help companies capture client sentiments. With Prodcamp's NPS module, businesses can easily create customizable surveys and analyze results in real time.
The module integrates with other ProdCamp features, such as the feedback management tool, to provide a comprehensive view of customer sentiment and help you inform your product roadmap and prioritize your work.
Keeping your users informed of the changes you make automatically along the way.
Is NPS the best way to measure customer satisfaction?
NPS is a widely used metric for measuring customer satisfaction, but it may not be the best or only way to measure it. Other methods, such as customer surveys, feedback analysis, and customer retention rates, can provide additional insights into customer satisfaction. The choice of measurement method depends on the specific needs and goals of your business.
How can I improve my NPS survey responses?
To improve your NPS survey responses, consider the following steps: 1. Keep it short and simple: Make sure your survey is concise and easy to understand, with a clear question and rating scale. 2. Timing is key: Send the survey at the right moment, such as after a customer has completed a purchase or interacted with your product/service. 3. Personalize the survey: Use the customer's name and personalize the survey based on their specific interaction or experience. 4. Provide context: Include a brief explanation of what the NPS score means and how it will be used to improve the customer experience. 5. Offer an incentive: Consider providing a small incentive, such as a discount or entry into a prize draw, to encourage customers to complete the survey. 6. Follow up on feedback: Actively listen to feedback, address any issues or concerns, and communicate the actions taken to improve based on customer input. 7. Continuously analyze and iterate: Regularly review and analyze the survey results to identify trends and areas for improvement, and make adjustments to the survey questions or process as needed.
What are the best practices of NPS?
The best practices of NPS include: 1. Use a standardized NPS question: Ask customers, "How likely are you to recommend our company/product to a friend or colleague?" and provide a rating scale from 0 to 10. 2. Classify respondents into promoters, passives, and detractors: Promoters are those who rate 9 or 10, passives rate 7 or 8, and detractors rate 0 to 6. 3. Calculate and track your NPS score: Subtract the percentage of detractors from the percentage of promoters to get your NPS score, which can range from -100 to 100. 4. Act on feedback: Use NPS feedback to identify areas of improvement and take action to address customer concerns or pain points. 5. Monitor trends and benchmarks: Regularly track and compare your NPS score to industry benchmarks and competitors to gauge your performance and identify areas for improvement. 6. Integrate NPS into your business strategy: Incorporate NPS as a key metric in your decision-making processes, product development, and customer experience initiatives. 7. Continuously survey and iterate: Regularly survey customers to gather NPS data, analyze the results, and make adjustments to your strategy based on the feedback received. 8. Share NPS results internally: Communicate NPS scores and feedback throughout your organization to create awareness and foster a customer-centric culture. 9. Use NPS as a driver of growth: Leverage NPS to drive customer loyalty, referrals, and revenue growth by focusing on enhancing the customer experience and building strong relationships with promoters. 10. Combine NPS with other metrics: Supplement NPS with other customer satisfaction metrics and data sources to gain a comprehensive understanding of customer sentiment and make informed decisions.
How can I improve my NPS customer service?
To improve your NPS customer service, consider the following strategies: 1. Understand customer needs: Take the time to understand your customers' expectations and pain points by actively listening to their feedback and conducting customer research. 2. Provide personalized experiences: Tailor your interactions with customers based on their preferences, previous interactions, and specific needs. Make them feel valued and understood. 3. Train and empower your customer service team: Invest in training programs to enhance the skills and knowledge of your customer service representatives. Empower them to make decisions and resolve issues effectively. 4. Streamline communication channels: Ensure that customers can easily reach your customer service team through multiple channels such as phone, email, chat, and social media. Respond promptly and consistently across all channels. 5. Be proactive: Anticipate customer needs and address potential issues before they become problems. Reach out to customers to check on their satisfaction and offer assistance. 6. Resolve issues promptly: When customers have complaints or issues, prioritize quick and effective resolution. Keep them informed throughout the process and follow up to ensure their satisfaction. 7. Personalize follow-ups: After resolving an issue, follow up with customers to ensure their satisfaction and ask for feedback on their experience. Use this feedback to continuously improve your customer service. 8. Foster a customer-centric culture: Ensure that all employees, not just the customer service team, prioritize exceptional customer service. Instill a culture of empathy, responsiveness, and continuous improvement. 9. Measure and track customer service metrics: Monitor key customer service metrics such as response time, resolution time, customer satisfaction scores, and NPS. Use these metrics to identify areas for improvement and set goals for your team. 10. Continuously improve: Regularly review customer feedback, analyze trends, and make adjustments to your customer service processes and strategies. Embrace a mindset of continuous improvement to deliver exceptional customer service.
How to increase customer satisfaction survey response rate?
To increase customer satisfaction survey response rates, consider the following tips: 1. Keep surveys short and focused: Keep the survey concise and avoid overwhelming customers with too many questions. Focus on the most important aspects of customer satisfaction. 2. Offer incentives: Consider providing a small incentive, such as a discount, coupon, or entry into a prize draw, to encourage customers to complete the survey. 3. Timing is crucial: Send the survey at an appropriate time, such as shortly after a positive customer interaction or after a purchase has been made. This increases the chances of customers having relevant experiences to share. 4. Personalize the survey invitation: Address customers by their name and personalize the survey invitation based on their specific interaction or purchase. This can make them feel valued and more likely to respond. 5. Use multiple survey channels: Offer customers different survey channels, such as email, online forms, or SMS, to accommodate their preferences and increase the likelihood of response. 6. Communicate the purpose and importance: Clearly communicate the purpose of the survey and how their feedback will be used to improve their experience. Highlight that their opinions matter and can drive meaningful changes. 7. Follow up reminders: Send gentle reminders to customers who haven't responded to the survey. These reminders can be automated and sent at appropriate intervals to maintain customer engagement. 8. Optimize survey design: Ensure the survey is visually appealing, easy to navigate, and mobile-friendly. A user-friendly design increases the likelihood of customers completing the survey. 9. Thank and acknowledge respondents: Show appreciation to customers who have completed the survey by sending a thank-you message. This acknowledges their time and encourages future participation. 10. Act on feedback: Demonstrate that you value customer feedback by taking action on their suggestions and addressing any concerns raised. When customers see their feedback leading to tangible improvements, they are more likely to participate in future surveys. By implementing these strategies, you can increase customer satisfaction survey response rates and gather valuable insights to enhance your customer experience.
What is a good response rate for NPS survey?
A good response rate for an NPS survey can vary depending on factors such as the industry, target audience, and survey distribution method. However, a response rate of around 30% or higher is generally considered to be good for NPS surveys. Keep in mind that the higher the response rate, the more representative and reliable the data will be.
What are the different types of NPS surveys?
There are primarily two types of NPS surveys: 1. Relationship NPS Survey: This type of survey measures the overall relationship and loyalty of customers to a company or brand. It asks the standard NPS question: "How likely are you to recommend our company/product to a friend or colleague?" The responses help categorize customers into promoters, passives, and detractors. 2. Transactional NPS Survey: This survey focuses on specific customer interactions or transactions. It asks the NPS question in the context of a recent experience, such as a purchase, customer support interaction, or website visit. Transactional NPS surveys provide insights into customer satisfaction at different touchpoints and help identify areas for improvement. Both types of NPS surveys provide valuable feedback, but transactional surveys offer more specific insights into individual interactions, while relationship surveys provide a broader view of overall customer loyalty. Combining both types of surveys can give a comprehensive understanding of customer satisfaction and loyalty.