The Net Promoter System: Alive and Kicking on the South Downs Way
My husband, the lovely Mr Gawthorpe, and his team hiked the South Downs Way earlier this year. We walk a National Trail each year for charity and this year we raised money for our local cricket team. The trail stretched 101 miles, from Winchester to Eastbourne, and each day the team started at a pub and finished at a local hotel.
As some of you know, I’m sporting an injury to my right foot at the moment so I couldn’t join them. Instead, I took the role of accommodation organiser.
I noticed just how easy it was to check reviews for potential pubs and hotels on social media, and I began thinking about how social media affects the purchasing decisions we make. If we like the way we’re treated, we become not just loyal customers, but advocates, promoters even. If we don’t, we’ll openly criticise. I decided to dig a little deeper.
Putting the focus on feedback
In his book, The Ultimate Question 2.0: How Net Promoter Companies Thrive in a Customer-Driven World, Fred Reichheld defines his ultimate question as “Would you recommend us to a friend?”. He measures a company’s score based on customer responses, then builds a customer-centric system throughout the company, beginning by calculating the lifetime value of the average customer.
It’s a free-to-use system and his book shows how the Net Promoter System (NPS) has made a significant difference to a whole range of companies. For Virgin Media, it decreased customer churn from 1.8% to 1.1% in just two years. Well worth a read.
Categorising your customers
Back on the walk, our final night was to be in Eastbourne. The team felt they’d earned a nice sea view and there are some lovely hotels on the sea front. However, many charge upwards of £180 a night – not the sort of price a group of rambling northerners were going to wear – so I plumped for a humble three star at £110.
I booked it through Laterooms. I find the process really easy and it meant we could cancel up until the day before. I like Laterooms. Indeed, in NPS terms, I’m probably one of their ‘promoters’. I’d definitely recommend them to a friend. In fact, I seem to be recommending them now.
If I were less enthused, you might find me in the ‘detractors’ category, which NPS describes as those so dissatisfied that they may sully your reputation. Those in between are the ‘passives’, people who are satisfied but not necessarily loyal, who could easily move to a competitor. The challenge for businesses is to move people up through these categories, creating as many promoters as possible.
Driving change through HR
It got me thinking. How can human resource professionals play a part in improving their organisation’s Net Promoter Score?
For a company to successfully grow using NPS, the system needs to be supported by the organisation’s most senior leaders, who in turn must be passionate about growing the business by delighting customers. That must include the people director, because he or she can have a huge influence on the success of customer loyalty.
But how? I identified five key areas:
What difference would it make to your business if every day all your staff fired up their computers and automatically saw the latest customer loyalty report for their department?
The best companies to work for take values seriously, and customer focus needs to be your number one value. After all, every single customer interaction influences whether that customer will remain loyal or not.
To make this core value work, people directors must be creative enough to find ways to imbed it in your organisation’s DNA. This isn’t the stuff of appraisals, bonus schemes and employee surveys – it’s more nitty gritty than that. It’s about HR using customer loyalty feedback to build, improve and manage people practices.
Culture begins with hiring the right people, at the right time, with the right skills and values. That includes attitude – you need people who genuinely want to help and delight your users, who have a real desire to be part of your business and all that it believes in.
Interviews alone can’t reveal all this, so it’s vital that people directors create recruitment teams with enough creativity and talent to come up with appropriate assessments.
If your company can listen to customer calls or receives client feedback, you can start by getting your training team to run sessions with front-line staff, asking them to put themselves in their customers’ shoes. I work with BPOs who are using their customer feedback very creatively, building it effectively into their team training.
Your front-line workers generally have the greatest power to delight your customers. By giving them, and indeed every employee, goals which have a clear line of sight to the Net Promoter Score, you’ll create opportunities to improve it. This creates a real step change in your organisation’s emphasis on its customers and their loyalty.
Reichheld points out that: “Done right, Net Promoter affects virtually every aspect of the company.” To get it right, absolutely every department will have a part to play, from customer-facing staff through to your quality, HR, marketing, PR and finance teams. In finance organisations, risk and compliance teams need to be on board too.
Customer loyalty is driven not just by what customers are saying, but by what employees are saying too. The sharpest people directors will rethink the best way to communicate with staff. Start by asking them: “Would you recommend working for this company to a friend?” Their feedback might just trigger a change in your communication strategy.
The Final Scores
So, what of our big adventure? Well, if you’re looking for little gems on this trail, I’ll happily be a promoter for Cowday Park and Newtimber Cottages. Sadly, our final hotel wasn’t quite in the same league. In fact, it was as grim as I expected.
Two days later, a note from Laterooms popped into my inbox, asking how they did. Right upfront was that magic question: “Would you recommend our service to a friend?” I gave them nine out of ten. “Would you recommend the hotel you stayed in to a friend?” Not likely. I gave them two.
The sign we found in the bathroom said it all really. It was a laminated A4 sheet that said: “Don’t flush disposable items down the toilet. Put them in the bin.” Underneath, in red, someone had written “WHAT BIN?”
Our weary team concluded their 101-mile walk, battling through all kinds of weather and customer service, and finished with a well-deserved beer on the pier. Another National Trail scalp!