Tuesday, January 06, 2009

2/3 Of Economy Influenced By Personal Recommendation

At least that's what McKinnsey and Company says... For the last few days, I've been studying the Net Promoter score. If you don't know much about Net Promoter Score (NPS), then keep reading, because you'll want to be part of this new customer service phenomenon.

Developed by Fred Reichheld, Author of The Ultimate Question, the idea is that how likely a customer would recommend you to a friend or peer is all that really matters. Sure, other customer surveys are important, but at the end of the day, a lot of recommendations will drive your success - economic success. Why? Well think about it. If you go back to the McKinnsey quote, then you need to look no further. Would you really buy something without the consult of a friend who had already purchased that "thing"? Of course not, you would be very interested. And that is the point of NPS. A company needs to find the type of person that is a promoter: someone who has had their expectations met! NPS also tries to uncover the detractors, or those that will have a negative impact. Yes, some people WON'T recommend you. With this category of user, you need to know WHY and fast.

So how do you find out what your score is? Well, according to my reading and research it is really simple: two questions. With all surveys you need to get a good response rate, so from my reading, I suggest surveying 100 people/customers. Make sure these people are a cross-section of your user base (not just the happy people). Next, the questions...

Question 1: How likely are you to recommend X to a friend (add the 1 - 10 scale)
Question 2: (ADD A FOLLOW UP QUESITON) - "can we follow up with you", "why did you rate the way you did"

To find out your score, all you have to do is calculate your company's Net Promoter Score (NPS), take the percentage of customers who are Promoters and subtract the percentage who are Detractors.

Will you do it???
Check out the survey gadget I've added and let me know what you think of this blog!!!


lauren said...

i dont blog, so it would be easy for me to not recommend this to someone. however, if i was active in the blogging world, then i would pass this one. love you brother

walkert said...

It isn't about blogging though... Do you like the content???