The value of a strong Net Promoter Score (NPS) is that it can indicate if your business is delivering on the promises that it’s making to customers. While there are many reasons and methods to measure customer experience (CX), keeping tabs on the perception of your customers via the Net Promoter methodology can be incredibly valuable for benchmarking the health of your business. For instance, high NPS scores positively correlate to customer retention, referral acquisition, and strong brand awareness.
In this blog, we’ll examine 4 real-world examples of companies using NPS to gain insight into their businesses. But first, let’s take a quick look at how NPS is measured.
What is NPS? How is it measured?
Net Promoter Score surveys measure customer loyalty by identifying customers as promoters, passives, and detractors. Essentially, NPS data is captured by asking:
“How likely are you to recommend ABC Company?”
Customers then answer on a scale of 0-10 (0 being the lowest, and 10 the highest) which is then used to calculate your NPS score and identify the promoters, passives, and detractors of your brand.
Promoters are those who answer 9 or 10 on an NPS survey. Passives are customers who answer 7 or 8 on an NPS survey. They’re not likely to harm a business with negative word-of-mouth, nor are they likely to recommend the business. They’re just unenthusiastic and may switch to a competitor who offers something new or more interesting.
Detractors are customers who rate your brand between 0-6. Detractors are not happy with the company and are likely to share their negative experience online and with friends and family.
Now that you understand how brands measure these scores, let’s take a look at a few examples of companies using the information collected to make some important decisions.
Bonobos measures what customers enjoy about their products with NPS
With a lofty goal of being the most beloved clothing brand of all time, Bonobos CEO Andy Dunn needed a way to measure customer experience and customer sentiment to make product improvement decisions.
Because Bonobos targets working male professionals, Andy and his team needed a survey methodology that’s simple to deliver yet collects the feedback required to make impactful business decisions. The team decided to use NPS as one of their key metrics for measuring exactly how a customer felt about their Bonobos experience and whether or not the customer would be willing to refer Bonobos to friends or family. Bonobos thrives on data and measures business decisions carefully.
At the beginning of 2014, the company experimented with adding an extra step to the shipping process. They measured the impact with Delighted NPS. They suspected the change would cause a handful of inbound customer questions and perhaps a few grumbles but Delighted told a different story: customers couldn’t stand the extra step.
Subsequently, Bonobos used this data to remediate these issues quickly by rolling back the change. In Dunn’s words:
“We were able to literally just watch the scores decline. That enabled us to have the confidence to roll back the change. I know that due to Delighted, we avoided disaster.”
Glassdoor optimizes website and services with NPS
Glassdoor is one of the world’s largest job and recruiting websites, helping job seekers browse millions of openings and empowering employees to share public-facing reviews of their employers.
Before using NPS, Glassdoor only collected feedback from users reporting bugs or website issues. While this feedback was good for making quick fixes, it was inadequate in providing a full picture of how all customers experience Glassdoor.
With a need to collect feedback from their audience at-large, Glassdoor chose Delighted’s NPS tool to survey and collect feedback from more people. According to Zoe Soto, Product Manager for Glassdoor, using NPS allows them to “sample everyone and receive more diverse product feedback.”
With this broader range of NPS feedback from a previously untapped audience, Glassdoor identifies where the product may need to be improved, and uses that feedback to drive decisions that help their users be more engaged and more successful. Glassdoor also uses ongoing feedback to measure the impact of those improvements.
“It’s super helpful to know when we invest in UX improvements, that it’s actually made a meaningful impact on how users feel,” says Soto.
InVision uses NPS surveys to keep a pulse on customer sentiment
InVision helps designers and clients around the globe collaborate more easily with a simple-to-use design platform.
As Manager of User Research Operations, Lindsey Redinger and her team use the qualitative component of NPS surveying to pinpoint what aspects of the InVision platform can be improved upon. According to Redinger:
“The most important piece of capturing NPS is the ability to solicit that qualitative feedback from those people who complete the survey. So, of course, with NPS we ask for a score, but the key piece is that we ask why they actually gave us that score.”
This information helps guide InVision on what changes should be made to provide customers the best possible product experience. This feedback also influences sales conversations in that it prompts reps to follow up with the product team to determine if a feature has been enhanced or fixed before presenting it to a prospect.
Moreover, NPS data allows the entire InVision team to keep tabs on customer perception - even the C-Suite.
“We have a pulse of the community and the people who use our product,” says Redinger.
“I do report pretty regularly on progress for enhancements to our NPS strategy, and also any customer-feedback strategies that we have ongoing. But it actually goes up to our board. So I have conversations with our VPs, our directors, and our C-suite on the sentiment, what those trends are - all that good stuff.”
HotelTonight addresses customer problems with NPS
HotelTonight depends on unbiased, candid input from users as a reality check into how the company is performing and what they can improve on in the future.
“A person who has a bad experience rarely takes the time to write us,” says Amanda Richardson, chief data and strategy officer at HotelTonight. “However, you need that user’s thoughtful, raw feedback to correct and improve experiences for all customers in the future.”
In order to collect this very-real feedback, HotelTonight began soliciting customer feedback with NPS surveying and overtime grew their NPS score to 75 - roughly double the average score of the hospitality industry.
This high NPS score has been achieved by using the feedback collected to quickly address customer problems. They do this by documenting negative feedback as it arises and uses this data to prioritize feature enhancements for the future. Using Delighted to monitor NPS keeps HotelTonight tuned into industry trends, first impressions, and other pieces of valuable customer insight.
“If you don’t measure NPS, you’ll never fix the root cause of customer problems,” says Richardson.
It pays to earn promoters: customer loyalty and NPS
Recently, Bain and Company published an in-depth report on NPS benchmarks and what they mean for business performance. Their research uncovered a positive correlation between a strong NPS, promoters, and revenue growth. Below are some fascinating statistics from that report highlighting the value of measuring NPS and acting on customer feedback.
- Retail customers who are promoters spend 3.5-4x more than detractors across a variety of retail products and services.
- Brands managing customer experience across web, in-store, and other omnichannel approaches have higher NPS scores and their customers tend to spend 1.8-2x more.
- Rewards programs with strong NPS incite customers to spend 2.2x more.
NPS helps businesses make smart, informed decisions. However, as we’ve stated before, NPS is just a calculation of how you are doing today in the minds of customers. The key to NPS and customer experience management is monitoring the information consistently to establish benchmarks for your company, identify trends, and address negative feedback to ensure that your score grows consistently.
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