<img height="1" width="1" style="display:none" src="https://www.facebook.com/tr?id=349935452247528&amp;ev=PageView&amp;noscript=1">
Search
word-map-thumb

The Alternative Board Blog

What's Your Personal Net Promoter Score - And Why Is It Important?

Oct. 18, 2013 | Posted by The Alternative Board
Five matted yellow web button stars ratings with reflection. Bla

Recently, I had the privilege of attending a fascinating talk by John Warrilow. John is the best-selling author of Built to Sell: Creating a Business That Can Thrive Without You. Built to Sell discusses key attributes a business owner should be aware of as they prepare to sell their business. Some recommendations include: not being too dependent on the business owner and not relying on a single customer. The most sellable businesses are teachable to employees, valuable to customers, and generate revenue in a way that's repeatable.

One of the most important attributes of the value of a company is its Net Promoter Score ®. The Net Promoter Score (NPS) was developed by Fred Reichheld from Bain & Company. Reichheld determined that a high score means your customers will continue to buy from you. A mid-range score indicates they may be shopping around or at least open to alternatives. A low score means you better pacify or replace the unhappy customer, and fast.

Want additional insight? Download Setting KPIs for Business Success now to learn more

DOWNLOAD

Studies have shown that his NPS score is one of the best predictors of company growth. In fact, you've probably noticed that you're being asked the following question more frequently on customer surveys:

On a scale of 0 to 10, how likely are you to recommend us to a friend or colleague?

If you don't have a customer survey, and want to start one, this question is a good place to start. The query has become an industry standard in measuring loyalty amongst existing customers, and is a great way to tell how likely consumers are to return. The net response to this question across all of your customers will determine your NPS.

NPS scores for companies like Apple, USAA and Canon are incredibly high. You might attribute the high score to everyone knowing these huge companies, or to the fact that giant corporations have the resources to produce the best products and best brands. Some of this is true - Apple, USAA Canon etc. do have great products - which is a sign that they listen to their customers and deliver what consumers want.  But they also have great service. And great service doesn't somehow just happen better in these large and successful organizations. These great service levels are created by the outstanding service that their employees deliver day in and day out as they interact with their customers.

If you are an employee, I would ask you to assess your personal NPS. Here's a really simple way to get a sense of where you stand:

  • Take a few minutes to reflect on your last 10 - or if your interactions are more complex, your last 5 - customer interactions.
  • Now, think about the next person those customers talked to. If you're in a B2C business, maybe it was a family member or friend. If you're in a B2B business, it was probably a co-worker.
  • What do you think the customer told their friend or colleague about your interaction?
  • If they said something positive, you are helping your company's NPS. If they said something bad, you are hurting your company.
  • What if they took the time to seek out a friend or colleague, and tell them what an exceptional experience they just had? That's what USAA customers do.

If you're a business owner, ask your employees to reflect on their personal NPS, then take it one step further. Start surveying your customers using the simple questions above. Or, lookup the simple method to measure an NPS and plot yourself against the average (it's about 5-10% for a typical company). If your score is average, or a little better than average, well done! If not, you need to get to work.

For more information on business leadership, check out TAB's PULSE Survey polling small business owners on complex business topics like succession planning, national sales averages, communication, and strategic planning.

Read our 19 Reasons You Need a Business Owner Advisory Board

DOWNLOAD

Written by The Alternative Board

Related posts

11 Top Business Apps Every Business Owner Should Have
Feb. 25, 2021 | Posted by The Alternative Board
As an entrepreneur, you handle an onslaught of tasks day in and day out. You are often juggling a multitude of jobs. Competing priorities make being organized and focused on the end goal even more...
5 Tips for Hosting a Virtual Conference
Feb. 23, 2021 | Posted by The Alternative Board
The business landscape has undergone seismic changes since the beginning of the pandemic. Workplace environments are being re-evaluated, with potentially huge implications around the corner. Another...
Tips on Using Artificial Intelligence to Boost Productivity and Profitability
Feb. 16, 2021 | Posted by The Alternative Board
For years now, large-scale businesses have been employing Artificial Intelligence (AI) to help drive productivity and high performance. This same technological advantage is available to small...
5 Tips to Help Remote Workers Feel Like Part of Your Team
Feb. 11, 2021 | Posted by The Alternative Board
Even before the COVID-19 pandemic struck in 2020, a leading trend among businesses was employing remote workers in a wide range of job responsibilities. The trend has, by now, attained something of a...
Employee Onboarding Tips that Help Boost Retention
Feb. 9, 2021 | Posted by The Alternative Board
The effective onboarding of new employees is clearly a benefit to businesses, but some companies persist in “winging it” whenever a new hire joins the team. As we have noted before, businesses that...
3 Tips on Vetting Your Most Promising Job Candidates
Feb. 4, 2021 | Posted by The Alternative Board
It would be nice to think that every applicant to a job opening at your business is always telling the truth in their resumes, during their interviews, and throughout the hiring process....
3 Tips for Rethinking Your Business Model
Feb. 2, 2021 | Posted by Phil Spensieri
One of the important lessons the COVID-19 pandemic has taught many business owners is that business agility is a key component to running a successful business. Business owners are challenged more...
8 Ways to Keep Your Employees Accountable in a Virtual Environment
Jan. 29, 2021 | Posted by The Alternative Board
Remote work is the new normal. In fact, remote work was gaining ground even before the pandemic hit, and with the start of 2021, many IT companies have permanently taken this route. However, there...
Attract New Talent to Your Team in 2021
Jan. 19, 2021 | Posted by The Alternative Board
Like all other facets of society, the business world has undergone seismic changes in the past year. However, one operational element—the recruitment and hiring of quality talent—remains unchanged....
The Difference Between a Strategic Plan and a Business Plan
Jan. 14, 2021 | Posted by The Alternative Board
Every business needs a strategic plan. Every business needs a business plan. It’s knowing precisely what each plan entails and when that plan can be of most use that makes the difference between...