NPS Blog

Finding the opportunity in a broken chair

Pam Carpenter of Herman MillerIf you’ve ever had a job where you interacted directly with customers, you know how hard it can be to deal with someone who has had a bad experience. Frustrated customers engage in a range of behaviors, from mild protest to begging, bargaining, asserting their rights or importance, or simply enraged venting. Whether the cause was a defective product, a mistake or poor service, your gut probably told you to try to calm down the customer, smooth over the situation and move on.

In fact, once you finished with that interaction, you probably just wanted to put it out of your mind. Certainly, the idea of re-engaging that customer—calling back to discuss the situation, ask for details and learn more—was probably not high on your list of things you might enjoy doing. But sometimes that’s the only way to get to the root cause of a complaint so you can learn more effectively, repair the relationship with that customer and even address issues that might be more pervasive than you realize. Fixing the problem and letting the customer know—a process we call “closing the loop”—is a critical part of the Net Promoter System and a powerful way to build loyalty.

In the latest episode of the Net Promoter System podcast, Herman Miller’s Pam Carpenter returns to tell us about the progress the office furniture company has made so far. During our conversation, Pam reviews some of her team’s early experiences with follow-up calls to customers. She also discusses an interesting experiment the company is conducting with a customer who agreed to let Pam’s team observe his efforts to get a broken chair fixed, allowing them to see the complaint process through the customer’s eyes.

Pam has also been wrestling with some typical questions Net Promoter practitioners face at this stage of the NPS journey: How do you improve response rates? How should you address customer experiences that span multiple interactions? How do you improve the quality of the feedback?

You can listen to our discussion on iTunes or through the player on this page. Click here to browse more Net Promoter System podcasts.

Can a company pay it forward?

This article originally appeared on LinkedIn.

We’ve all heard of “paying it forward”—the idea that one thoughtful act on someone’s part can touch off a chain reaction of good deeds. I’ve posted before about how companies can get into the act through intelligent acts of kindness. These are simple, inexpensive gestures that brighten a customer’s day and generate loyalty.

But some commenters on my post questioned whether companies can ever be expected to act in a generous spirit. Others wondered whether a company can really hope to engender this kind of behavior in their employees. Continue reading

Why your customers break up with you

This article originally appeared on LinkedIn

Recently a colleague’s son decided to cut the cord to his cable provider. He bought a Roku stick so he could stream movies and TV shows from Netflix, Hulu and others. He installed a high-quality antenna so he could pick up over-the-air channels from neighboring cities. “I was surprised,” my colleague said, “because he’s a big Red Sox fan, and those games are the one thing he can’t get. But he was completely fed up with the cable company’s terrible service and the expensive bundled pricing.”

In cutting the cord, the young man became part of what service providers call churn, meaning turnover among customers. When my Bain & Company colleagues recently studied churn, they found that most telecommunications and media companies lose between 2% and 2.5% of their customers every month. For a company with 5 million customers, that churn rate means that about 1.3 million customers and $2 billion in revenue vanish each year and must be replaced. Continue reading

Breaking down the “invisible fence”

Every company needs rules and traditions, but if left unchecked, restrictive policies can stymie creativity. They can give rise to what my next guest on the Net Promoter System podcast calls “invisible fence syndrome.”

Net Promoter System podcastLike a dog that’s been zapped too many times while trying to go beyond those invisible electrical fences so popular in suburban yards, employees with this affliction stop offering new ideas because they assume the response will be negative. Employees stuck in a culture of “no” start to feel that their contributions don’t matter. If employees don’t feel heard by their managers, it’s likely that customers also feel this way. It’s a dangerous situation for companies trying to build loyalty.

In the latest episode of the Net Promoter System podcast, we speak with Tony Ezell, who has worked to thwart invisible fence syndrome at Eli Lilly. During his more than two decades at the pharmaceutical giant, Tony has been responsible for adapting Net Promoter for the company’s scientists, sales teams and managers. He’s exceptionally candid about some of the challenges he encountered and how he would have tackled them differently now that he’s been through the experience.

Success in big pharma has always been associated with the discovery, development and marketing of new drugs. So why is a global powerhouse like Eli Lilly thinking about customer loyalty and the Net Promoter System? Find out in our latest podcast.

You can listen to our discussion on iTunes or through the player on this pageClick here to browse more Net Promoter System podcasts.

Closing the loop in the real world

Every now and then you hear about a company that gets it right. They listen to customer feedback. They act on it. Sort of gives you a warm, fuzzy feeling—except that you wish it wasn’t so unusual.

The other day, a colleague of mine came back from a trip to the Washington, D.C., area. I asked him how it went. “The trip was fine,” he replied, “but the hotel stay was terrible. I was up half the night listening to the A/C unit cycling on and off. Every time it came on, it sounded like a jet plane.” Continue reading

Dishing up real-time feedback for restaurants

I eat out in restaurants a lot. Objectively, it’s fair to say that I eat out too often, sometimes as many as 15 times a week. While I wouldn’t say that I’m a restaurant snob, I do pay attention to lots of little things like how genuine the initial greeting feels, or whether the server is attentive or how confidently they talk about menu items.

Does the server make recommendations that I find compelling? Do they sense what I’m looking for and try to figure out how to pace the meal? And maybe most important, do they keep my water glass filled?

You might think it odd for a guy who is so focused on customer feedback for a living, but I’m also a little bit shy about providing direct feedback to my servers. I don’t know why, but unless there’s a real problem I tend to suffer in silence. And at the end of the meal, I tend not to vary the tip all that much based on the quality of service because I don’t think tips offer a very efficient way to provide feedback.

In the newest Net Promoter System podcast episode, we hear from two people who have recognized this dynamic and are trying to do something about it. Bernard Briggs is the CEO and founder of Humm, a company that provides systems for collecting customer feedback at restaurants, stores and other retail environments. Robert Irvine is a restaurant owner and the host of the popular Food Network show, Restaurant: Impossible. He has actually put the system to use at his restaurants.

I love watching Robert’s shows, and I find it both fascinating and gratifying that he’s using the Net Promoter System in his own restaurants. Moreover, I love the simplicity of the solution that Bernard and his team at Humm have developed. I’ve never actually used it myself, so I can’t attest to how it works in practice yet. But I love the concept and hope that companies like Humm continue to innovate and make the process of delivering real-time feedback easier and more frictionless for both customers and companies.

For more about Bernard Briggs and Humm Systems: Humm Systems website. You can learn more about Robert Irvine: Robert Irvine website.

You can listen to our discussion on iTunes or through the player on this pageClick here to browse more Net Promoter System podcasts.

We have catalogued many companies providing Net Promoter System support here.

No gains from your loyal customers? Five questions to ask

If your company has earned high Net Promoter Scores, it’s reasonable to expect that you’ll outperform your competition. But sometimes that doesn’t happen—at least not right away. If you’re wondering why your strong service hasn’t yielded better-than-average performance, here are five questions to ask:

  1. Do you know what makes your promoters enthusiastic about doing business with you? Your best customers have experienced you at your best, and they can often provide useful insights into which of their needs you are best able to serve. That allows you to understand the value you provide to customers and, if necessary, to sharpen your focus.
  2. Do you have the right products at the right prices? Customers may love what they have already bought from you, but if your other products and services aren’t what they need or aren’t priced competitively, they’ll look elsewhere. Make it easy for them to choose your products.
  3. Are you selling effectively? Underdeveloped sales capabilities can keep you from translating customers’ good feelings into more business. Your high scores indicate that your customers are probably willing to buy more from you. But you might not be offering them what they want at the right time or in the right way.
  4. Are you giving your promoters tangible stories to tell? People tell stories about their exceptional experiences with companies. They say to their friends, “You won’t believe what just happened to me.” If your customers’ experiences are good but unremarkable, don’t count on happy promoters to bring you more business.
  5. Have you provided a platform on which to tell those stories? Delighted customers can always tell their friends in person, but if they have a forum (either online or in the real world) for sharing it with other like-minded people, they can tell many more.

High Net Promoter Scores alone won’t guarantee profitable, sustained growth. True loyalty leaders develop the skills and the capabilities necessary to give customers more of what they want: opportunities to make their lives better and to bring their friends along for the ride.

Learn more: Converting loyalty into economic advantage

Paying it forward to customers

Companies can and should contribute to positive experiences in the world, and it’s good business practice to do so. The trickier question is how to foster a culture that achieves these aims without seeming cloying or artificial.

We all know the Golden Rule—treat others as you would want to be treated. But what does it take to get your employees to consistently live up to this standard and genuinely care about your customers? I look at this issue in my latest blog post on LinkedIn.

Read the post here: Can a Company Pay It Forward

Lessons from students at the University of Phoenix

Higher education is undergoing dramatic change at every level. Traditional universities are facing pressure to attract the best students while they attempt to hold down tuition costs. Meanwhile, for-profit universities such as the University of Phoenix have grown dramatically in recent years. Both are competing for students’ time and money with MOOCs—massive open online courses—and technical programs.

Ruth VeloriaIn the next episode of the Net Promoter System℠ podcast, Ruth Veloria, executive dean of the University of Phoenix School of Business, offers an insider’s view of her company’s efforts to become more customer focused. She’s on a multiyear journey to increase the school’s ability to turn student feedback into action. Interestingly, Ruth is beginning to focus as much on the potential future employers for the university’s graduates as she is on the students themselves. During the podcast, she talks about the linkage between satisfying the needs of future employers and those of students.

You can listen to our discussion on iTunes or through the player on this pageClick here to browse more Net Promoter System podcasts.

Simple is as simple does

Is your company especially analytically oriented? We hear people describe their companies this way a lot, often as a way of explaining that nothing as simple as Net Promoter® could ever work in their company. They’re all engineers or accountants, or maybe even insurance actuaries.

As it happens, our latest podcast is with Richard Watts, who led the adoption of the Net Promoter System℠ at Progressive, the US-based insurance company. You probably know it as the company that employs Flo, the bubbly, white-aproned spokesperson who stars in Progressive’s advertising.

Richard retired from the insurer in 2010, but he remains active in the Net Promoter community. In our conversation, he explains why Progressive chose Net Promoter and reveals some of the points of resistance he encountered in its adoption, including the challenge of rolling out a simple metric at a company with an affinity for complex math.

You can listen to our discussion on iTunes or through the player on this page. Click here to browse more Net Promoter System podcasts.

What your current customers might not be able to tell you

You’ve probably heard me say that the best indicator of your company’s ability to grow is how your customers feel about doing business with you. If many of them would recommend you to a friend or colleague—and if few say they wouldn’t—then you’re in good shape. If you’re a company that uses the Net Promoter System℠ to measure customer attitudes, then that willingness to recommend is probably translating into some pretty good scores.

But you have to be sure you’re measuring those attitudes in the right way. If you aren’t, those high scores can be misleading.

Imagine that you were running Tower Records, say, or Blockbuster shortly before those companies went out of business. If you were sampling the attitudes of only your own customers, you might still be hearing a lot of positive responses. The reason? People who hated doing business with you had already decamped for music downloads or DVDs by mail. Those people were no longer customers and no longer part of your ordinary feedback system. The rosy picture you were seeing came only from the people who preferred you to the newer alternatives.

This is a common problem, and not just for companies confronted with a disruptive business model. If your airline or restaurant chain faces new competition from an upstart, the first customers to defect will be those who like you least. Your customer-loyalty scores may even go up for a while, when really all that has happened is that angry customers have left. If your competitor is good enough, however, many more will follow.

So every company needs to find out what alternatives its customers and potential customers are considering, or what they might be considering in the near future. One good method is the Net Promoter® competitive benchmark process.

Competitive benchmark NPS® typically involves hiring a third-party research firm to survey a large sample of customers in your industry, your own and other companies’. The researchers ask the “how likely would you be to recommend” question about many different alternatives, score the responses on the familiar zero-to-10 scale and then probe to find the reasons behind the responses. It’s a double-blind method in which neither researcher nor respondent knows who’s sponsoring the study.

Why is this kind of survey important? Because it’s the best way to find out what everyone in the marketplace is considering. Is Airbnb a real threat to your hotel business? Are Roku, Apple and Aereo a formidable challenge to your cable business? A survey that asks about all the available alternatives helps company leaders know where the major threats and opportunities lie. It helps them determine strategic priorities, such as where and how aggressively to invest.

In some industries, of course, a company can rely on rankings published by established market research firms. But Net Promoter companies typically find that market feedback based on Net Promoter concepts and language can motivate more consistent and effective action. Competitive benchmarking produces rankings and scores that tie in with a company’s internal language and closed-loop systems. Frontline employees “get” the score and have learned how to improve it. An opaque customer-satisfaction rating from a third party doesn’t produce the same motivational bang for the buck.

Happy customers are great—they’re a sign that you’re doing your job well. But even happy customers won’t stick around if another company offers a significantly better product or service. That’s why you need to learn what the marketplace is thinking. No one wants to be the next Tower Records or Blockbuster.

 

Technology that helps you close the loop

In our latest Net Promoter System℠ podcast, I speak with Borge Hald, CEO of Medallia. Medallia’s services help companies capture customer feedback, understand it in real time and take action to improve the customer experience. The company’s software powers closed-loop feedback. Its systems also combine customers’ unstructured, verbatim comments with other operational data, so employees can understand what else might have affected customers’ experience.

Medallia supports some of the best-known companies using the Net Promoter System. In fact, I met Borge through one of his company’s most ardent promoters―an NPS Loyalty Forum member who insisted on bringing him to one of our quarterly meetings. Her advocacy made a real difference, and now, many of our Forum members are also Medallia’s customers.

In this podcast, Borge and I discuss the future of customer feedback and the role of text analytics. We also talk a little about how Medallia got its start during a particularly difficult time. You can learn more about Medallia at their website.

You can listen to our discussion on iTunes or through the player on this page. Click here to browse more Net Promoter System podcasts.

We have catalogued many companies providing Net Promoter System support here.

The problem with pasta on a plane

It’s a long flight from the US to Singapore, where Bain recently held its fourth annual Asia-Pacific Loyalty Forum. And as it happens, on that trip, one of the attendees of the Forum had an experience that illustrates an important and all-too-common issue.

While in Singapore, I recorded a podcast with two long-time loyalty leaders―Brian Andrews, a former vice president at Intuit, and Linda Verba, head of service strategy at TD Bank―who were kind enough to sit down with me for a chat. Brian mentioned that on his flight, a deeply apologetic flight attendant had told him that all the other meals had run out and she could only offer him pasta.

It seems someone at the airline’s headquarters figured out the company could save money if the number of meals loaded on the plane exactly matched the number of passengers on board. The airline played the odds on how many people would ask for beef or chicken and then stocked exactly that number on the plane. The problem: The pennies saved on those meals came at the cost of an embarrassed employee and a potential insult to a business-class customer, who had paid a steep price for his ticket.

Fortunately for the flight attendant, she had found an understanding customer in Brian. He ate the plate of pasta and shared the lesson at the Loyalty Forum. To hear more about his “Where’s the beef?” experience, listen to the podcast at 28:30 (the second part of our two-part series with Brian and Linda). You can listen to our discussion on iTunes or through the player on this page.

Click here to browse more Net Promoter System podcasts.

Do your customers’ have a predominant personality?

In the latest Net Promoter System℠ podcast, I chat with Kelly Conway, CEO of Mattersight Corporation. Mattersight’s applications combine analysis of customer conversations with data about those customers—as well as other aspects of the relationship—in near-real time to help employees serve those customers better. Its applications allow a company to do things like route customer calls to the reps who can best handle them or identify a customer who’s in distress and suggest ways to diffuse the situation.

I heard about Kelly and Mattersight from a member of the NPS® Loyalty Forum who had used Mattersight’s tools to improve customer service and sales. In this podcast, we explore just how much you can learn about how a call is going—and how to improve it—using Mattersight’s algorithms. We even talk about how customer groups at different companies have predominant personality types. And once you know what those are, you can hire employees to match them. I found what Kelly and his company do so fascinating that I had to share it. You can listen to our discussion on iTunes or through the player on this page.

Click here to browse more Net Promoter System podcasts.

Lessons from long-time loyalty leaders

In our latest podcast, we bring you a conversation with two deeply experienced loyalty leaders, Linda Verba and Brian Andrews. Linda Verba is the EVP of Retail Operations and Service Recognition at TD Bank Group, and one of the prime architects of TD’s service culture. Brian Andrews was, until just recently, the Vice President of Customer Experience and Business Excellence at Intuit. He was an early member of the Loyalty Forum and has been a thought leader there for a long time.

In this, part one of our conversation, we reminisce about the early days of Net Promoter and how it has evolved from a score into a business system. We also look at some of the things TD Bank and Intuit have learned about how to make Net Promoter a powerful force for change in their organizations, such as branding it internally. Linda also describes some of the cultural reinforcements, such as TD Bank’s “1 to say Yes, 2 to say No” rule.

You can listen to our discussion on iTunes or through the player on this page.