Sometimes Success Gets in the Way

There have been studies that show customers are more loyal if you have a problem and fix it, than if they never have a problem with your product or service. Many companies check how loyal and fanatic their customers are by looking at Net Promoter Score. By measuring the Net Promoter Score (NPS), you can tell if you're making the right improvements that matter to your customers.

The NPS is a measurement of the difference between those that rate you a 9 or 10 (on a 10-point scale) and those that rate you at 6 or less. Customers rate you in answer to one question: "On a scale of 1-10, how likely are you to recommend us to your peers and colleagues?" Those that rate you at 9 or 10 are considered promoters. Those at 6 or below are detractors. (Ratings of 7 or 8 are considered neutral.) If the percentage of promoters exceed the percentage of detractors, then you are overall exceeding customer expectations. The goal in using NPS is to increase the difference between promoters and detractors.

Many companies also provide a spot for comments that allow customers to tell you why they gave you this rating. The comments are extremely helpful.

At one company, the NPS continued to grow. It looked like we were being very successful. For every detractor, we had 5 promoters. When we started measuring it, the ratio was one detractor to 2 promoters. However, in two of the most recent surveys, there was some excellent information given in the comments that made us worry. In our review, we learned that we needed to change. We couldn't be complacent.

We sliced the NPS data in many directions. For example, we looked at the data from the perspective of how long the person had been a customer of ours. It turned out that the longer-term customers rated us lower than newer customers. Customers from certain industries rated us different from other industries. We also plotted the comments in a matrix. We counted the number of comments about price, quality, delivery, technology, and service as given by the promoters, neutrals and detractors. Detractors focused on price and quality. Promoters commented more frequently on service (like fixing the problems) and technology.

Combining all of this is told us one key thing: though we were growing, we had better fix our systemic problems with quality because our customers were losing their patience with repeated problems, and therefore, not accepting the proposition that our products had value. It was in the industries that we thought we brought the most value, that the customers didn't perceive the value. We had an image problem.

We were successful--growing and the NPS was increasing--but we were on the edge of slipping backwards. Or having to invest more in attaining new customers as old customers left us. If we stayed content with success, we wouldn't last. We needed to change. We needed to figure out what to change since the NPS told us how prevalent the detractors were and therefore it seemed our problems were systemic.

How about you? Are you content with success? If you use NPS, what does the analysis tell you about whether congratulations or a kick in the pants are in order?