If there’s ever a moment in life when you need to care about what others think of you, it’s this one: when your business depends on your customers returning.
Fred Reichheld, author of “The Ultimate Question 2.0”, explains the risks you’re subjecting yourself to if you ignore customers’ feedback:
“In the past, the accepted maxim was that every unhappy customer told ten friends. Now an unhappy customer can tell ten thousand “friends” through the Internet.”
Reason why you should continuously collect NPS feedback and use it as a compass in optimizing your business.
In short, with NPS, you’re aware of the voice of the customer. In turn, you can become more skilled in delivering excellent customer experiences and high-quality products.
However, the NPS alone is not strong enough to give you a proper direction to improve customer loyalty – you also need to analyze your NPS results.
Suppose you want a complete understanding of your business health. In that case, you should drill down on customer feedback and combine it with other data sets from your business.
Not sure where or how to start?
Read this guide to Net Promoter Score Analysis, meant to bring some light into the ocean of customer data inside your business and direct you towards getting a clearer vision of your business health.
What is NPS Analysis?
The NPS Analysis represents the next logical step after collecting your Net Promoter Score. In the NPS Analysis stage, you analyze the NPS data from different angles to get an accurate view of your business health.
The Net Promoter Score analysis helps you go beyond a simple metric. It enables you to get a comprehensive understanding of your customer’s satisfaction. If you do it right, your long-term customers will give you the insights that can make or break your business:
- How good is your delivery?
- Are you delivering the value you promised?
- How effective is your customer care department?
- How knowledgeable and helpful are your store employees?
This knowledge, combined with the right strategy, can take your business from zero to hero and become the popular choice among your customers and their peers.
3 Angles for NPS Analysis
Angle 1: Customer Journey NPS
It’s a good practice to calculate the net promoter score at two critical points of the customer journey:
It’s important to understand that shoppers aren’t really buying your product when they first become your customers. It’s more likely they were convinced by the marketing around the product.
They have no idea what to expect, but they sure have expectations.
So with the post-delivery NPS, you can identify whether you delivered on the initial marketing promise or it was just a mirage.
This is called The Delivery Gap – the difference between pre and post-delivery NPS.
Pre-Delivery NPS – Post Delivery NPS = Delta NPS (The Delivery Gap)
Delta NPS can be negative or positive.
Obviously, positive Delta NPS means you’re doing a good job. Your promises are genuine, and customers are satisfied.
With a negative Delta NPS, you’ll need to go further with your research and figure out where and how you’re falling behind on your promises.
Here’s where open-ended NPS questions come in handy. Beyond the classic “would you recommend us?”, you can ask for further information from your customers and identify the friction points inside your business.
Check out this article for question examples. We compiled a list of NPS Questions to help you get started with your NPS surveys.
Angle 2: NPS by RFM Segment
One of the crucial steps in your mission of reducing customer churn is treating your customer right.
Probably your intention is to give every customer VIP treatment and treat your customers equally. However, not every customer is created equal, and it wouldn’t be wise to treat them like they were.
One ICP brings you more value than 300+ regular customers, so your purpose here is to identify and treat these ICPs right.
So, looking at the NPS by RFM segment will allow you to do just that.
RFM groups help you identify customers who wouldn’t be missed if they churned and those with high customer lifetime value. Improving your NPS score for these groups should be your priority.
So, combine the Net Promoter Scores with the RFM segmentation and prevent any possible hiccups concerning your most important customers.
Angle 3: NPS by Location
Location is another great angle to consider in your NPS Analysis, especially if you’re a hybrid business with offline stores or deliver globally.
Analyze your NPS by location and see if you can rely on your delivery partners or if there are any issues in a particular region with your products.
Benefits of NPS Analysis
Before we go into the particulars of NPS Analysis, let’s quickly recap what the Net Promoter Score (NPS) represents:
NPS is the metric that allows you to understand how many of your customers are willing to recommend your brand to their peers.
No amount of advertising can ever do more for your business than customers’ heartfelt recommendations of your brand, so it’s only natural you’d be determined to keep your NPS scores high.
However, as practical as it is, customer NPS will only bring you that far. You need to go into the depth of the data and attribute meaning to your scores.
NPS results don’t exist in a vacuum – they need to be correlated with customer data to bring the actual benefits of customer feedback.
Besides attributing meaning to an otherwise random metric, NPS analysis helps you identify:
- which are the main aspects to solve inside your business,
- who your valuable customers are,
- and which are your priorities inside your company.
* Disclaimer: to get these priceless insights, you should use a comprehensive NPS survey template to ask the right questions and ensure you’re getting all nuances of your customers’ feedback.
Let’s take them one by one.
- Find what needs to be fixed.
An NPS Benchmark will tell you an NPS higher than 30 is a sign your company is doing great and its customers are happy.
However, there’s always room for improvement.
This is why your NPS surveys should also contain a follow-up, open-ended survey question, asking both promoters and detractors to justify their responses:
- Could you tell us what disappointed you about your experience?
- Could you tell us what you appreciated most about your experience?
These responses will tell you what needs to be improved and what’s working inside your business.
Maybe people love their personalized experiences on your website, but they hate the checkout process. Or they love the process but are disappointed with the delivery options.
Honestly, there’s no better source of insights about your business than people who are actually using your products and going through the customer journey.
So pay attention to NPS responses and what people say about your business.
Then, after you get a list of improvements and strong points, you can analyze your respondents to…
- Identify your valuable customers.
It’s 5x more pricey to get a new customer than to keep a current one. With NPS, you can estimate customer loyalty and turn loyal customers into brand ambassadors.
Loyal customers can be included in your marketing strategies – since they voluntarily spread the word about your brand to their peers and communities.
Loyal customers should be pampered and kept from leaving your business. So it’s great that you have a tool to quickly spot them inside your customer base and pay special attention to them.
And the gift of NPS Analysis doesn’t stop here since it keeps giving opportunities for your business. Last but not least, with NPS Analysis, you can:
- Prioritise your actions.
Combine NPS Analysis with RFM Segmentation, and you get the exact order in which you should take care of challenges inside your business.
Companies lack the resources and bandwidth to treat everyone outstanding.
Besides, if everything is a priority, then nothing is a priority.
Customer-centric companies focus heavily on their customers but prioritize their resources accordingly.
They segment customers into Recency, Frequency, & Monetary scores, then monitor customer experiences and behaviors.
With NPS Analysis, you understand what should be improved to reduce customer churn of specific segments.
A way to prevent churn is to trigger different actions according to each customer segment.
Steps for an Effective NPS Analysis
Step 1 – Sort the responses into different categories.
As you read earlier, performing your NPS Analysis from different angles is best. Otherwise, you’re just measuring random numbers.
It can be a geographical segmentation, segmentation by brand/category, RFM, or seasonality – you do it according to your needs or specific areas you need feedback on.
Integrate your survey tool with a customer relationship management tool, so you can sort your data quickly with all the criteria you’re tracking.
Step 2 – Analyse the responses.
Obviously, you want to read every survey response and analyze the feedback. This feedback is even more valuable if you use a survey template containing open-ended questions. So the customer verbalizes issues using his own language.
However, reading thousands of replies regularly can be tiresome, so use text analytics software to extract high-quality information from the responses.
Text analytics software helps you identify common complaints in a faster and more consistent manner.
It also gives you more feedback since you don’t need as many human resources to read and interpret the responses.
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In time, the changes triggered by the NPS Analysis will make your brand more customer-centric compared to your competition.
Step 3 – Find the root cause of customer feedback.
After you interpret the feedback, it’s time to find the root cause of negative feedback.
Your survey software should prioritize the responses according to the value of your customers, so start with the best customers.
Look for noticeable patterns inside your responses:
- Similar NPS coming from customers from the same region
- Similar NPS coming from customers of the same product/brand
- Similar NPS coming from customers in the same season
Where there’s a pattern, there’s a recurring issue – find it.
Step 4 – Send your insights to the right teams.
Involve your whole team and work together to improve your NPS. Distribute customer feedback with the right people and brainstorm to find creative solutions to customer issues.
For example, if your NPS reveals that users hate the quality of a particular product, discuss with the product development team to improve the quality.
Or if users don’t like the long-response time from the support team, discuss with your CX people to find a solution.
You won’t be capable of solving all issues on your own – getting the teams by your side is as important as getting customers by your side.
Step 5 – Action!
The latest step is how you make sure NPS isn’t just another sexy metric you’re measuring. Like with any other feedback tool, vision without execution is just hallucination.
Now it’s time to use positive and negative customer feedback.
Make a priority with your Detractors by making them feel heard and valued.
Obviously, it would be amazing to solve their issue instantly. Sometimes you can do that – like a messed up order. However, if the issue is complex, you can at least get back to your customers.
Contact them about their feedback to do damage control, and prevent them from spreading WoM about your brand.
With Promoters, you should act quickly and leverage their positive sentiment into good word-of-mouth advertising.
- Ask for a website review.
- Share their comments.
- Ask for a testimonial and post it yourself.
- Offer them perks or extra benefits.
And with Passives, see what would have made the experience better, then give them what they want.
The info from the open-ended questions will deliver actionable ideas on improving your experiences.
How Omniconvert Reveal helps you with NPS Analysis
Customers expect you to solve their problems instantly in such a fast-paced commercial environment.
And loyal customers are even less patient when waiting for you to respond to their complaints.
Most companies monitor NPS with the help of external providers, who send their questionnaires, and stop there.
But you have to treat objections in real-time, not after one quarter.
Or worse, never.
Thankfully, modern technology can make your job 100x easier.
Use Omniconvert Reveal for automated pre and post-delivery NPS surveys. Give your customers a voice, and improve customer satisfaction & experience.
With Reveal, you can level up your NPS data analysis and analyze customer happiness with:
- General NPS
- NPS per RFM group, Customer Attribute, Order Attribute
- Catalog NPS per Product, Brand, Category
Moreover, you can trigger alerts for high-level customers and send tickets directly to your customer support team.
This way, they can react quickly and interact with unhappy customers.
So your loyal customers will feel seen, heard, and pampered – customer loyalty stays the same.
NPS analysis links word-of-mouth advertising, improved retention rates, and Customer Lifetime Value. It connects and influences them all.
Doing it correctly ensures your company will thrive in any conditions because your customers will save it.
Worst-case scenario? It’s not like any business ever suffered because they listened to their customers and improved based on their feedback…so why not do it?
Frequently Asked Questions about the NPS Analysis
Discover your Net Promoter Score by subtracting the Percentage of Detractors from the Percentage of Promoters. NPS Formula: %Promoters – %Detractors.
Anything above 0 (positive score) it’s a good Net Promoter Score. If your NPS is above 50, it means you’re doing a great job taking care of your customers. If your NPS is above 70, your CX is world-class!
NPS helps you determine whether your business has more loyal customers (Promoters) than unhappy customers (Detractors). Promoters give you a score of 9-10, Detractors 0-6. If your NPS is positive (above 0), it means you have more Promoters and you’re doing a good job. A negative score means you need to improve your business asap.
NPS stands for Net Promoter Score. It’s a metric that shows you the probability of your customers recommending your brand to their peers and communities.