Want to improve your NPS? Here are 6 proven action plans to increase your net promoter score and gain more loyal customers in 2022.
We live in a customer-centric business world, where customer experience is regarded as the “king”. It is the most important indicator of your company’s success, after all a satisfied and happy customer is the one who is likely to become a loyal customer, and in turn boosts revenue. That is why more than two thirds of companies say they mostly compete on improving experiences, instead of outdoing each other with new product features or constantly engaging in price race.
But, then how to accurately gauge customer experience and their loyalty to your company?
The answer is simple: Net Promoter Score, in short NPS.
NPS is a metric that companies use to measure customer experience, satisfaction and loyalty. Besides, it allows you to benchmark yourself against your competitors and observe how effective your consumer-oriented decisions are. Having, a high NPs simple means that customers are happy with your brand, and would like to continue with your products or services and will recommend the same to others. Consider this an average NPS increase of 7% correlates on average with a 1% growth in revenue (Source: London School of Economics).
Look at companies such as Nike, Amazon, Apple, Netflix, etc. who have been able to maintain consistently high NPS, and have been able to build up their brand into the market leaders they are today.
Given its significance, improving NPS has indeed become a necessity for the businesses?
How to calculate NPS?
But, before going further, let’s quickly understand as to how to calculate NPS and what is considered as a good NPS.
Typically, NPS comes in the form of a customer survey typically sent to the customers at least twice a year. To calculate NPS, survey customers and see how likely they are to recommend your business on a scale of 0-10.
- Start with the standard one question which is “on a scale of 0 to 10, how likely are you to recommend this business to a friend or a colleague?”
- Categorize the responding customers according to their scores: Detractors (0-6), Passives (7-8), and Promoters (9-10).
- Subtract the percentage of Detractors from the percentage of Promoters to determine your overall NPS.
Generally speaking, a NPS that is below 0 indicates that a business has a lot of customer satisfaction issues to address. A score between 0 and 30 is better, however, you can still improve, while a NPS higher than 30 indicates that the company has quite a good number of happy and satisfied customers.
How to get a better NPS score?
Now that we have understood the fundamentals of NPS, let us review the action plans for increasing your NPS to improve and grow your business
We have come up with the four major action plan that will help you to improve your NPS score:
- Focus on better customer experience (CX)
Customer experience (CX) is incredibly valuable for all the businesses, and over the time it has moved from being a competitive differentiator to a key business imperative. Companies that lead in customer experience are now outperforming their competitors by nearly 80%.
“71 percent of people recommend a product or service because they received a “great experience”. – PWC Report
Without being customer-focused, it is difficult for businesses to stand out of the competition. So, it is essential to know your customers’ needs and expectations and aligning your solutions closely as this will encourage customers to be loyal towards your brand and increase the satisfaction rate.
Besides, being customer-focused means businesses should put the effort into understanding the customer journey to identify their needs and expectations. Though, understandably, your customers are likely to have different journeys in accordance to their touchpoints and engagement level, so you need to undertake an all-inclusive customer journey mapping to know your customers’ persona, understanding their needs and desires, framing out their touchpoints, and more importantly identifying their pain points. Subsequently, recognize the journey that is pushing the net promoters and detractors. Once you are aware of your customer journey, you can definitely improvise on the touchpoints that are driving your net promoters and detractors, while delivering an excellent customer experience.