All of us have, at some point, received a text or email survey from our favourite service provider asking
“How likely are you to recommend us to a friend or colleague?”.
People across industries know this as the Net Promoter Score (NPS) question. This score calculates the likelihood of customers promoting your business by way-of-mouth. It is a powerful metric that has evolved over the last decade and is now a key business measure predicting and managing revenue growth.
However, there are 3 fundamentally different types of NPS measures that are designed for actionability and insights at different levels. Sometimes these differences are not obvious and can be misunderstood as being the same score.
What are the types of NPS, and which suits your purpose best?
NPS measurements are versatile and can be used in different scenarios to measure how likely customers (internal & external) are to recommend and what they are ‘basing’ this recommendation on.
Relationship or Brand NPS:
It measures the customer experience focussed on a single interaction with the customer and is triggered after that interaction is completed.
For example, an independent experience of talking to a customer service representative or of ordering from an online store would typically precede this NPS type of survey or after taking a particular flight.
This type of NPS measurement is highly actionable and helps give actionable insights that drive continuous improvements in customer experience. Imagine a particular route for a airline was systematically scoring lower NPS, the airline could look to improve the service for that particular experience and match it to customer expectation. Or customer service in the contact centre was scoring a lower NPS at a particular time of week, the organisation could look to train the staff or increase it for that particular time of week.
Transactional NPS scores give the greatest level of granularity for action and insights and thus have become the most effective form of NPS measurement.
It measures the experience after a single customer need / want has been met. This customer journey may involve several customer interactions (I.e., touchpoints)
For example, applying for a new internet connection at home would require multiple interactions with the brand- and the survey is triggered when the journey is completed. Touchpoints would include seeking information on the website, speaking to a representative, making the payment and finally installation. All these touchpoints together make the customer episode e.g., getting a home connection, and the survey would measure the customer experience at the end of meeting that need. Did we create a brand advocate, and would a customer recommend to another to use our service to meet a particular need?
This type of episodic metric is the most mature and customer centric of all three NPS measures. It puts the focus on the customer episode / need rather that the various operational services in a company.
Typically, companies also include a “Why?” question to follow the NPS rating. This is an open-ended question, providing a space for customers to elaborate on why they gave that score. The verbatim responses offer invaluable insights on how to improve the customer experience and/or what customers value within an experience. Allowing organisations to make investment decisions.
“Please tell us why you gave this score?”
“Is there anything we cane do to improve your experience?”
These insights are gold for executives and help them predict and prevent customer churn. Recurring themes may also flag possible need for process change to be looked into to improve the customer experience (e.g Not enough changing rooms in a store or poor usability of e-commerce website).
|RELATIONSHIP NPS||TRANSACTIONAL NPS (CSAT)||EPISODIC NPS|
|What does it measure?||Measures -brand sentiment and advocacy||Measures customer experience for a particular experience||Measures how well a particular customer need was met and whether we created a promoter or detractor in meeting this need. r|
|Frequency||Predetermined time intervals, normally quarterly||Triggered after the completion of a single experience||Triggered after meeting a particular customer need e.g., Loan settlement, Home internet connectivity|
|Sample Question||Based on our overall relationship, how likely are you to recommend [company name] to a friend or colleague?||Based on your recent purchase at store X, how likely are you to recommend [company name] to a friend or colleague?||Based on your recent request for a new internet connection, how likely are you to recommend [company name] to a friend or colleague?|
|User examples||Customers overall relationship with a Bank Schools relationship with parents Commercial Property Owners with tenants||Ordering home-delivery Talking to a customer representative in a contact centre Making a sales enquiry||Resolving a customer complaint Completing a school enrolment Requesting new internet connections|
NPS is a powerful methodology and has been adapted to not just measure Customer Experience, but also:
- Employee Experience – How likely your employees are to promote the company as a good-place-to-work
- B2B Experience – How satisfied your vendors or business partners are
- Product Experience -How satisfied users are with the product or product updates
- Service Experience – How satisfied your customers are with your service delivery
It is no wonder that NPS surveys are now a driving force for growing companies, and most companies use multiple types of NPS surveys targeted at distinct internal and external stakeholders. Its insights afford managers with the potential to measure and improve multiple experiences and that is a gamechanger in driving customer growth and revenue.
See how Resonate can help you utilise NPS programs within your business