The hands-down best type of B2B marketing is word-of-mouth (WOM) and referrals offered by your loyal existing customers to others in the market. When the people we trust (friends, family, people in our network, other companies in our industry, etc.) recommend a brand or provider, we tend to trust them: in fact, an incredible 92% of people trust recommendations from a friend or colleague, according to a survey from Nielsen IQ.
B2B marketers know that brand reputation and referrals are more valuable than any marketing campaign or channel. Brand reputation is nothing more than the aggregated perceptions people have about what you do and how you do it. If customers like you, they’ll refer you and your business will grow. If they don’t, they’ll express their displeasure via multiple channels and damage your brand reputation and growth.
What is NPS?
Net Promoter Score or NPS is a commonly used metric for measuring a customer’s experience with your business. NPS is based on one simple survey question: “How likely are you to recommend our company to a friend or colleague?” Customer responses are measured on a scale from 0 (not likely at all) to 10 (very likely).
According to NetPromoter.com, respondents are grouped into 3 categories:
Promoters (score 9-10) are loyal enthusiasts who will keep buying and refer others to you, fueling your business growth through referrals.
Passives (score 7-8) are satisfied but unenthusiastic customers who are vulnerable to competitive offerings. If they see a special promotion or discount from a competitor, they may switch.
Detractors (score 0-6) are unhappy customers who can damage your brand and inhibit your growth through negative word-of-mouth.
Net Promoter Score is generated by subtracting your percentage of Detractors from the percentage of Promoters. In theory, your NPS could range from -100 (where every customer hates you) to a high of 100 (where every customer is a Promoter). For example, if 35% of your surveyed customers are Promoters, 55% are Passives, and 10% are Detractors, your NPS is 25 (35 minus 10).
Passives are excluded because they typically remain silent and don’t impact your brand reputation either way - they’re not so dissatisfied that they’ll make an effort to leave you or complain nor are they satisfied enough to buy more from you or recommend you. The average B2B company has an NPS of 24, while best-in-class B2B companies range between 50 and 80, according to B2B International.
Behavioral and ROI differences of the 3 NPS categories
The Passives are ready to leave you as soon as they can find a better offer. As their name indicates, Passives often stay with you out of pure laziness rather than loyalty. If you build a customer base of Passives, you’ve built a castle out of sand that can collapse the moment your competitor offers a 5% discount.
Detractors don’t just leave you, but they also talk negatively about you to the market, expressed either online via negative reviews or in person whenever your business’s name comes up. These Detractors actually hurt you in the short-term and in the long-term by eroding your brand reputation.
Promoters, on the other hand, keep coming back and spend more money over time. They are not only loyal, but they become brand ambassadors who bring other customers to you via referrals. Promoters, unlike detractors, will also give you the benefit of the doubt and stay loyal when you increase your price or make an operational error. They’ll even buy and promote your new products.
3 basic tips to improve your NPS
Giving your customer a cupcake after they’ve closed a deal won’t turn a customer into a Promoter. Think holistically and long-term about how to delight customers, and meet their expectations at every step of the customer journey. Map out that customer journey and invest time into discovering where the “potholes” are, where customers face friction. Eliminate those points of friction as they pop up: you’re playing an ongoing game of CX “whack-a-mole.”
When you eliminate these potholes in your customer’s journey, you’ll be seeing fewer Detractors, which is a great start. But if your CX is just generical and frictionless, you won’t generate much lifetime customer value (frictionless is CX table stakes these days). The trick is to move beyond “filling in potholes” to creating memorable moments in the customer’s journey that turn Passives into Promoters.
Technology might help you eliminate friction, but creating delight is a very human, often manually-intensive endeavor. Promoters have emotional bonds to you, they care about you as an organization. The “magic” happens when your B2B company treats customers in very human and personal ways. Here are 3 actionable suggestions for improving NPS:
Track your NPS regularly by surveying your customers. If you have fewer customers and fewer customer interactions, you can conduct your NPS survey annually. If you have a higher volume of customers and lots of interactions, you might conduct NPS surveys more often.
Strengthen customer relationships with each interaction. Every touchpoint matters for NPS and CX, so don’t just send your customers a Holiday card but then respond slowly to their requests the rest of the year. Show up for your customers every day. Customer loyalty and trust is built over time with consistent, positive interactions occurring via all available channels, with all your departments.
Fill your CX potholes. If your website is slow to load, your customers will feel the friction. If you promised something on Wednesday, and it’s late, your customers will feel the friction. Carefully map out your customer’s journey and then do two things: (1) eliminate the friction points along the journey and (2) look to add memorable moments of real delight and surprise. As in all relationships, It’s the small gestures that often matter most.
Interested in learning more about how to leverage data like NPS to improve your B2B customer experience? We can help, please reach out to us here.