When Jim Bush took over customer service at American Express in 2005, most companies were evaluating their support efforts on one metric: how quickly reps could use their canned scripts to get customers off the phone. He had a hunch that treating customers like human beings, even if by a little, would be a huge boon to the company.
Viewing customer service as an opportunity to build amazing relationships with customers rather than a cost of doing business led him to institute the net promoter score (NPS) system developed by Fred Reichheld at Bain & Company in 2003. NPS is a simple survey that asks, “How likely are you to recommend our company?” Answering on a scale from 0-10, respondents are then categorized according to their rating as detractors, passives or promoters.
The net-promoter concept transformed customer support. Instead of asking “How can I resolve this call?”, reps started thinking in terms of “How can we get the customer to want to recommend American Express to friends?” Both attitudes are geared towards fixing problems, but the latter builds incredible long-term value: customer loyalty and engagement.
That long-term view worked. Bush found that promoters — those most likely to recommend American Express to others — were spending 10-15% more than others, and were four times more likely to stay with the company.
As Jim Bush told Fortune:
we moved from being transaction-oriented — the investment and training had been all around how to complete the transaction — to building on the relationship with the customer.
Building relationships and fostering that sense of advocacy in customers relies on following up and continuing conversations. Here are some ideas for how to use NPS surveys to build stronger relationships with your customers and increase engagement, reduce churn, and strengthen retention in the long run.
NPS Survey Basics
Simplicity is the NPS survey’s strength. The survey is one question — a rating between 1 and 10 — followed by an optional open-ended question asking for a quick explanation of the rating. The lightweight nature of the ask makes it easy for people to respond.
NPS survey example email
Keep it simple: It’s always tempting to tack on more questions in a survey, but response rates plummet with every addition. Two requests — a number rating and the option to leave qualitative feedback are what make up the elegant power of NPS. Simplicity and consistency also reduce bias and enable you to use the scores as benchmarks.
The Question: Reichheld found that the most effective question is: “What is the likelihood that you would recommend Company X to a friend or colleague?” You can customize the wording based on your goal or focus for the survey (e.g., company, brand, product, service) and user type (e.g., friend, colleague, friend) — as well as the follow-up question. (Here are some helpful ideas for customizing your questions from Zendesk.)
Sample question asking for rating explanation
Framing the question around willingness to recommend to somebody else gets at the truth a bit faster and serves as a more powerful conversation-starter than something like “How satisfied are you?”. Simply asking about satisfaction in one moment turns out to be a weaker predictor of growth and doesn’t dig up the level of honesty you get when thinking about endorsing something to your friends.
Calculating the score: Based on responses, customers get categorized into 3 groups: Promoters (9-10); Passives (7-8); and Detractors (0-6).
For your overall NPS score, you’d then subtract the percentage of detractors from the percentage of promoters. That score will be between -100 (everyone is a detractor) to +100 (everyone is a promoter). According to Promoter.io CEO, Chad Keck:
any score that is above zero is good, anything above +50 is excellent, and over +70 is considered world-class.
What to use: NPS collection usually takes place through surveys delivered over email and in-app or in-product. You can build this tool yourself or use the many dedicated NPS solutions and tool features out there. Here are a few options:
(We’ll talk about cool ways to do NPS in customer.io in later posts!)
How to Close the Loop
Don’t just calculate your NPS score and stop there. Ondrej Sedlacek, co-founder of Satismeter explains how NPS is an entry-point to conversation, better understanding, and future improvements:
NPS is not about the score itself. It is about listening to your customers and helping them solve their problems. It is often overlooked to follow up immediately on every response. You can resolve unsatisfied customers' problems and effectively reduce their churn with NPS.
The real value of NPS comes from how you digest and address survey responses and resulting conversations — whether it’s a simple thanks for feedback, solving customer problems, or delving further for more information.
Chad agrees: “NPS is just a starting point to drive meaningful engagement with that customer and a deeper relationship. Everything hinges on the follow-up which is often referred to as ‘closing the loop.’” You can improve retention and create loyal customers if you’re able to connect with them and close the loop to address their opinions in a focused, targeted way.
If you’re dealing with manageable numbers, you can answer each response manually. But if you start getting a certain volume where it becomes difficult to handle each communication personally in a timely fashion — separate the 3 types of respondents into segments, with their own strategy and messages.
We’ve collected some ideas you can adapt to close the loop for each of these segments:
1. Detractors: Make a Personal Connection
Bill Gates said it best: “Your most unhappy customers are your greatest source of learning.” When someone is flat-out not going to recommend your product to others, you have a great opportunity to learn about how you can improve.
So when detractors don’t leave feedback, it can be frustrating. But don’t be afraid to reach out and ask! Chase Clemons from Support Ops recommends automating this type of message to your detractors:
Asking for both sides of what detractors like and don’t like not only provides you with more details, it opens up the opportunity for you to “find out how they’re using your service. And it’ll remind the customer about the good things they do enjoy about you.”
Other questions you can ask to dig deeper into an unexplained low rating include:
- What exactly are you trying to do with our product?
- How is it falling short?
- What would be your ideal solution?
You can continue this conversation over email or offer to hear customers out on the phone to really hash things out.
Sample email offering a personal follow-up conversation
Any qualitative feedback from detractors — solicited from follow-ups like Chase’s email above or included in the NPS response — provides a chance to bring them back into the fold or improve their perception of you in a targeted way. Here are some additional follow-up ideas based on that feedback:
- If they want a feature that’s coming out soon, give them a peek at your product roadmap. This will have the residual benefit of making them feel cool and included for knowing where your company is going. You could also offer to put them in a beta or tester group.
- If they have a specific problem that you can address, whether with a workaround, further education, or a future fix — tell them about it!
- If their problem is solvable through an integrating or another service altogether, then be honest and tell them. You may lose a customer but in leaving a trustworthy impression, you may create a brand advocate or engaged audience member.
2. Passives: Delight Them Before They Churn
Passive customers fall into an interesting place. Their opinions aren’t as strong or developed as promoters or detractors. That could very well mean your passives aren’t leaving any comments, even though their ratings of 7’s and 8’s seems pretty high. In fact, in their NPS benchmark report, Zendesk found that only 37% of passives left open feedback as compared to 50% of detractors and 55% of promoters.
Passives may like your product just fine but their apathy opens them up to jumping ship as soon as they run into something cheaper or shinier. They’re waiting for something either good or bad to happen so they can break out of the deadlock of being passive. As Chad from Promoter.io told us:
Passives are not “good” customers. They are stagnant in most cases, highly susceptible to competition and as many as 40% will churn just like detractors, only over a bit longer period of time.
Because of this shaky grounding, do some testing and experimentation with this group before you settle on an approach. Your passives might not want to get into a conversation about lukewarm feelings. It might be best to take a laid-back approach, sidestepping additional feedback, and offering nice gestures can turn the tide to build trust. Or maybe a personal, human conversation digging deeper into what could be improved may be the spark needed to fire up a positive emotion.
Here are a few ideas for gestures to show the passive segment that you care:
- Send ‘thank you’ swag.
Companies send customers free swag like t-shirts and mugs to boost retention, and it works. But don’t view this as a quid pro quo interaction. Instead, offer a token of your appreciation for their patronage and feedback.
To automate some of this process, you can set up event-triggered internal notifications in Customer.io when a customer gives a certain score. Another option is to get addresses from tools like Clearbit or your customer records to use services like Startup Threads, which can ship your company’s swag directly to your customer.
- Comp a free upgrade or offer a discount
Passives are generally more price sensitive than promoters. For instance, loyal Apple devotees will shell out whatever it costs for the next iPhone, but lukewarm Apple buyers might switch to Android when they see how much lower the prices are. But offer them an upgrade or a coupon — and they might stick around long enough to have a better experience of your brand’s core value.
While writing the email offering the free upgrade, there are three main points you want to express: that this is something that carries no risk, the value and benefits, and that this is something trustworthy that other users have paid for.
Here’s the type of upgrade offer you could adapt for a survey follow-up.
3. Promoters: Show Appreciation
Your 9s and 10s are your ideal customers. But that doesn’t mean you should be satisfied with just seeing 9s and 10s on your surveys. Nurturing your most engaged customers is a smart business move, as American Express found. Taking your best customers for granted is a regrettable way to lose them and what’s more, you’re missing out on gaining valuable insights about what makes them tick and leverage for further growth.
Nurture those connections.
Some of the best strategies for the passive segment can also apply to your promoters: it’s about strengthening relationships. So you might want to start with a nice “Thank you” note with some swag, helpful content, or a promotion.
- Free upgrades and promotions.
Offer your promoters a chance to upgrade their service, either for free or for a discounted price. Even if it’s just temporary, aiming upgrades at your promoter segment increases the chances that they’ll take part, and in the long run will improve your chances of retaining them.
Trello offers a free month of their Gold service for every user that you refer to their service, and recently, after hitting 10 million users, they gave away additional months for every user that tweeted about their favorite way to use Trello.
This is a great type of offer specifically for promoters. They create mutually beneficial behavior loops, helping both your company and your customer: it’s an upgrade, so customers will be happier and less likely to churn, but your product also gets a bit of great PR.
Get the word out
Consider asking your best customers to spread the word about you. Sometimes, all it takes is asking nicely.
- Ask for a review or testimonial (and provide a little help)
Promoters are more willing to leave a positive review or share their impression of you online. Reduce the friction inherent to the process even further by prepopulating a field with a customizable template or providing sample questions and examples to make the task easier.
Baremetrics sends out pre-populated tweets to their promoters:
Here’s how Lorrie Thomas Ross of The McGraw-Hill 36-Hour Course: Online Marketing does it:
Hello (Their Name),
I’m updating my website to include current testimonials, and I would love to brag that you are my client. I’m looking for a short testimonial about your experience working with me.
Here’s an example of one I’m including:
“I never thought I would see an end to my tax problems until I hired you. Anyone with small business tax problems must see this firm! - Leslie M., CA”
If it is easier, I can write one for you to edit. Let me know!
Find out what makes your happy customers tick**
Use an analytics tool like Mixpanel or KISSMetrics not only to analyze results on retention and churn but to examine the behavior of your 3 NPS-related segments. It’s easy to get obsessed with what detractors and passives are doing but your promoters' behavior and activity provide a key to what’s working. Use these findings and insights to formulate incentives and strategies for carrying out NPS survey follow-up communication with less happy customers.
The most critical thing to remember about NPS is that the number itself is pointless. It’s not quantum mechanics: just observing your results won’t do anything to change them.
Running an NPS survey means opening up lines of communication between you and your customers — and doing so in a systematic way. NPS provides an incredible avenue to make an impact. It’s worth it to think about how best to close the loop.
We’ve got more posts in the pipeline on how to do NPS surveys to improve retention and growth. Stay tuned by signing up for our newsletter below! 👇👇👇