How are you doing with your customer satisfaction ratings? I’ve been taking a look at some Net Promoter Score benchmarking results recently, and it seems that not too many organisations are floating their customers’ boats.
You probably know that NPS is based on the fundamental perspective that every company’s customers can be divided into three categories? “Promoters” are loyal enthusiasts who keep buying from a company and recommend their friends and colleagues to do the same. “Passives” are satisfied but less enthusiastic customers who might well be wooed by the competition. And “detractors” are unhappy customers who are most unlikely to be recommending the company.
But did you also know that the average firm scores an NPS efficiency of only 5 to 10 percent. In other words, promoters barely outnumber detractors. Many firms—and some entire industries—have negative Net Promoter Scores, which means they are creating more detractors than promoters day in and day out. This helps explain why so many companies fail to deliver profitable, sustainable growth, no matter how aggressively they spend to acquire new business.
The following examples of current NPS star performers are taken from the Satmetrix Net Promoter industry benchmark reports. Looking at the best performers across all industries in the USA and Europe, USAA (Banking) comes out on top with 83%, with their Auto Insurance operation scoring 74%. Apple scores well in the UK (67%), Germany (70%), and France (57%), but you can see there’s still room for improvement.
Understanding customer requirements, the CTQs in Lean Six Sigma speak, and the processes that aim to meet them is the foundation of good customer service. Having the right measures in place to monitor performance and know the extent of improvement needed is vital.
This links back to my last blog where I talked about managers needing to work on their processes with the people in the processes to continuously improve performance and achieve everyday operational excellence.
By the way, in case you wondered, Catalyst has been using NPS for over 5 years and scores 84.5% for our Foundation Green Belt programmes and 72% for all products and services combined. As with the likes of USAA and Apple, we have scope for improvement, but we’re proud to say that much of our business comes from client referrals, something that underlines the importance of NPS as an effective measure of performance in the customers’ eyes.