The Net Promoter Score (NPS) is all about rating your customer advocacy levels which is of course, a key aspect of loyalty, some argue it is the ultimate loyalty measure, with the answer to the Ultimate Question ‘would you recommend us’ needing to be Yes for as many of your customers as possible.

Reichheld explains the main process for NPS as follows:

1. Creating closed-loop processes so that the right employees will directly investigate the root causes that drive customers into these categories.
2. Making the creation of more promoters and fewer detractors a top priority so employees up and down the organization take actions based on their findings from these root-cause investigations."

So, the idea is that after surveying as many customers as possible (to make it representative) and show you are listening, to then work backwards to determine which aspects of the experience of interacting with a brand creates ‘Promoters’ or ‘Detractors’.

You can read more on the Net Promoter Score Blog. Blog on achieving advocacy by Fred Reicheld and other specialists in achieving advocacy such as Dr Paul Marsden.

• The Net Promoter Score forums have good practical discussion on NPS methodology, survey questions and response rates
• The View Ultimate Question on Amazon UK

Reichheld, F. (2006) The Ultimate Question: Driving Good Profits and True Growth. Harvard Business School Publishing.

• View Paper on Net Promoter Score - Hosted on the American Marketing Association site

How NPS calculations works

NPS is based on economic analysis of the customer base of a company. For Dell, reports estimates that the average consumer is worth $210 (five year, Net Present Value), whereas a detractor costs the company $57 and a promoter generates $328.

The value of promoters is generated by positive word-of-mouth and they also naturally have higher retention and spend rates. At the same time, the influence of detractors needs to be assessed since they can create negative word-of-mouth.

Achieving response on NPS surveys

Early adopters of NPS in the US discussing implementation on the NPS Community have found that listening and feeding back pays dividends, as these participants explain.

Read this great discussion on setting the The Right Target for Response Rates

Here are two useful examples of implementation:

Experience 1:

"The first time we sent the survey out, the response rate was 22%, 6 months later the response rate was 30% and the last time we did it the response rate was 39%. I believe this increase in response rate has been a direct result of them following our recommendations of feeding back to customers the results of the survey and the areas they are working on improving. Their customers have seen they are serious about this process and now see that the time they spend completing the survey is worth it! (And funnily enough their performance scores have increased!)"

Experience 2:

"We have a specialized hosted application with more than 13,000 customers logging in daily to run their IT Services businesses. When we learned about the Net Promoter program, we developed an application that displays the Ultimate Question immediately after logging-in, actually "intercepting" the customer on the way into the app. We have them the choice of picking their score and submitting, or to "Ask Me Later." If they select the latter, they get a pop-up that explains how important their opinion is to us, and that we will ask them again tomorrow. The system waits 24 hours before serving up the question again.

I'm sure we will be learning a lot as we get more experience with this fantastic tool".

Applying Net Promoter Score to the web

The increasing importance of social networks provide a platform for both Promoters and Detractors. Brands need to think about they facilitate promotion within the web environment and manage the comments of detractors.

An example of the type of problem that can occur is indicated by the Land Rover car brand – a search for this marque shows the message “DO NOT PURCHASE a Land Rover Discovery 3 - you will live to regret it if you have a similar experience to me as countless other owners have too.” in the natural search listings thanks to a critical posting in www.haveyoursay.com.

This despite the site owner having approached Land Rover. Maybe time for some negative SEO to help reduce the position of this company in the natural listings.

On a positive note, there is a lot a site owner can do to facilitate advocacy within their site, check out our checklist of ideas to consider to influence and manage online advocacy on the website or within email:

Tips for facilitating online advocacy

Here is a checklist of ideas:

• Page template contains ‘Forward/recommend to a friend’ options.
• Email have ‘forward to a friend option’
• Enable customer feedback and showcase positive experiences, e-retail sites contain options for rating and commenting on products,
• Business sites have prominent testimonial and case study sections with pull-outs featuring customer success stories
• Sites indicate ‘wisdom of crowd’ through showcasing top selling products or most read and commented features
• Involve customers more in shaping your web services and core product offerings - See Dell Ideastorm

Managing online detractors

• Use Online reputation management tools for notification of negative (and positive) comments.
• Develop a process and identify resource for rapidly responding to negative comments using a natural and open approach.
• Assess and manage the influence of negative comments within the natural listings of search engines.
• Practice fundamental marketing principles of listening to customer comments about products and services and aim to rectify them to win-back the situation!