Ext. Mustafar – Dawn
Obi-Wan and Anakin are on the platform where Obi-Wan’s spaceship has just landed. Anakin is enraged. They stare each other down.
OBI-WANYou have allowed this Dark Lord to twist your mind until now… until now you have become the very thing you swore to destroy.
ANAKIN Don’t lecture me, Obi-Wan. I see through the lies of the Jedi. I do not fear the dark side as you do. I have brought peace, justice, freedom, and security to my new empire.
OBI-WAN Your new empire?
ANAKIN Don’t make me kill you.
OBI-WAN Anakin, my allegiance is to the republic… to democracy!
ANAKIN If you’re not with me, you’re my enemy.
OBI-WAN Only a Sith Lord deals in absolutes. I will do what I must.
Obi-Wan ignites lightsaber.
ANAKINYou will try.
Anakin ignites lightsaber.
You don’t know the powah of the customer
Customers may not betray you like Anakin, but when your best customer decides to leave your business for good, wouldn’t it be nice if they told you why?
What if they told you how you messed up or when you ignored them? What if they told you how (in their mind) you screwed them over? What if they told you about a competitor that offers them more, while charging them less?
With all of that feedback, could you find a way to make your organization better?
Unfortunately, most of your patrons won’t go out of their way to tell you how they feel. Especially as they silently walk out the door never to return.
Are you powerless from preventing this? Of course not. But if you haven’t invested heavily in your customer support or customer success departments—even if you’re a one-woman show—then you’re in some serious doggie doo.
In June 2014, Deloitte published its annual consumer review titled, The Growing Power of Consumers. In the report, they conclude:
Remember that saying, “The customer is always right?”
Well, now that saying could be something like, “The customer is in charge of your f’n business.” Yeah, I know. We’re not there. Yet. But there’s no denying that digital technology has flipped the economy on its head—allowing people and ideas to connect more rapidly. The result? It’s impacting on how organizations relate to stakeholders.
The circle is now complete
You know the ages, right?
- The Agrarian Age
- The Age of Enlightenment
- The Industrial Age
- The Information Age
- The Connection Age?
Sure, why not? Connection is the theme of our time, and it’s spreading fast. Businesses, pay attention.
Think about it. Social media connects you to people in real-time. You can share ideas within your network to save someone time, energy, and money. Thanks Google, Twitter, and Facebook.
You can reach out to influencers within companies who can impact whether you get hired or not. Thanks LinkedIn.
You can learn about a company’s compensation packages, culture, and management structure before applying to work there. Thanks Glassdoor.
You can connect to a community of like-minded people in-person, if you like. Thanks Meetup.
You can contact someone in another country, stay at their place, and experience life as a resident, not a tourist. Thanks Airbnb.
Connection to more people means more choices, more options.
You get to choose which business you support. Not the company with the most locations. Especially when it comes to on-demand delivery systems. Think Amazon-like ecommerce companies. Traditional brick and mortar brands: rethink your strategy.
You get to choose which charity deserves your money. Not the one where your friends and family typically contribute. The Internet exposes you to a long tail of problems that are more personal to you. And there’s probably a charity for that particular cause.
You get to choose what type of organization to work for. Not the one the media or your parents believe you should work for to have a decent career.
Your power to choose and your personal network can either send a brand soaring or suck the wind out of it. A simple tweet, video, or blog post can build or break a brand.
As a consumer, a hyper-connected world is good for you. As more and more people share their ideas, reviews, and perspectives on products and services, you make wiser purchasing decisions—forcing brands to design better products or services.
“Power to the people!” is not just a saying anymore. It’s real. While a few brands have created a loyal following, other companies struggle to keep customers.
I find your lack of loyalty disturbing
Has anyone ever taken your brand and tattooed it onto their body?
It’s okay if you answered “no.” It’s not easy to reach that level of brand obsession. Of course, if you answered “yes,” then congratulations—your brand is legendary.
Seriously, the likes of Harley Davidson, Apple, and Coke are considered legendary brands. People paint those brands all over their body. Now that’s passion.
But you don’t need your customers to ink their whole arm to show brand loyalty. Most people will reward you with continued business and refer other clients to you—isn’t that good enough? I’m sure you’ll take it.
Like I said, digital technology is putting power back in the hands of the everyday person, creating new problems for businesses. You may want to disrupt yourself before you’re forced to, if you haven’t started already.
Because without loyalty, or in business speak—strong retention—your business is a revolving door. As fellow Jedi, Joseph Jaffe says:
This wisdom is still ignored, as many companies still emphasize acquisition over retention.
But hold on, retention isn’t loyalty. Someone may stick with you because there’s no competition. They may hang around because you’re just around the corner. But what if someone comes along and offers a better product? What if a competitor offers same-day shipping? If you’re not going the extra mile and creating remarkable experiences for your customers, then you’re toast my friend. Remember:
Don’t be that person. Without retention, your company won’t make it out of infancy. Without loyalty, you’ll plateau. So build loyalty if you want real growth. When you have loyalty, people are more willing to forgive you when you make mistakes. And you will make mistakes.
Because you didn’t start your business journey just so it would end abruptly, did you? Didn’t think so.
So how loyal are your customers? Let’s find out.
Meet my ally: Net Promoter Score
Would you like to measure customer loyalty and its long-term impact on your business? Is there such a tool?
Good news. There is a tool that measures loyalty. It will give you actionable takeaways to help increase customer loyalty, fueling Apple-like growth for your organization.
Imagine knowing which product features make the majority of your customers happy and which ones leave them frustrated. Imagine happier employees who are more effective in their jobs.
Powerful, huh? And anyone can implement this in their business, organization, or one-man show—right away. Some big-time companies are already doing it. Giants like Apple, Facebook, Nike, Lego, Rackspace, and Zappos.
These companies have serious loyalty to their brands and they’ve all used the Net Promoter Score (NPS) to make them even stronger.
The good news? You can do the same.
So let’s figure out where you stand in terms of loyalty with your customers. Ready?
How NPS works
NPS asks two simple questions of your customers.
Question 1 is what they feel about your product/service/organization.
Question 2 is why they feel that way.
Fred Reichheld, founder of the Net Promoter System, conducted surveys with thousands of customers in 6 different industries. With his colleague, Rob Markey, he wrote The Ultimate Question 2.0 and discovered that based on their rating feedback, people fit into 3 groups.
The 3 Categories
Question 1 gives you a number. That number places your audience into 3 different categories: Promoters, Passives, and Detractors.
Anyone that responds in the 9–10 range is a Promoter.
Promoters are your evangelists. They come back for more and provide consistent revenue. Promoters refer others to your brand through word of mouth—bringing in more business and living up to their label. In the end, they probably cost you less over their lifetime and are generally low maintenance.
Anyone that responds in the 7–8 range is a Passive.
Passives got what they came for, but they’ll leave through the door just as fast as they arrived. They can live with you, and they can live without you. And if they make a referral, they may lack enthusiasm. So passives could go either way. If they see a bigger reward or discount from a competitor, they’re likely to defect.
Anyone that responds in the 0–6 range is a Detractor.
Detractors are dangerous to your business. They think you’ve done them wrong and they’ll let the world know about it. If they’re in the 0–2 range, feelings of hate and discontent probably course through their veins. Detractors are high maintenance and make employees miserable, which affects the workday and productivity of teams. Bottom line: detractors are profit killers.
Dimensional Research in conjunction with Zendesk researched how customer service stories spread—especially the bad ones. Check this out:
- 95% of customers share bad experiences, and 87% share good experiences with others.
- 54% of customers shared bad experiences with more than 5 people, and 33% shared good experiences with more than 5 people.
- 58% of customers are more likely to tell others about their customer service experiences today, than they were 5 years ago.
- B2B, gen X, and high-income households are most likely to share their customer service stories.
- A customer is 4 times more likely to defect to a competitor if the problem is service-related rather than price or product related. (Bain & Company)
- The probability of selling to an existing customer is 60% to 70%. The probability of selling to a new prospect is 5% to 20%. (Marketing Metrics)
- 55% of customers would pay extra to guarantee better service. (Defaqto)
- It costs 6 to 7 times more to acquire a new customer than to retain an existing one. (Bain & Company)
And Accenture has even gone as far as labeling today’s climate as the “Switching Economy” due to the tremendous opportunity of consumers switching services. $5.9 trillion is up for grabs.
The force is with you
Remember the 3 categories?
By the way, this is based on Episode IV. So geeks, chill on Han Solo being a Passive. He was “passive” for about 99% of the movie.
Darth Vader believed he was “wronged” by his former employer (the Jedi Council) so he not only joined another company (the empire), but he made it his mission to destroy all competition. Vader is a serious Detractor. Do you want a crazed Sith Lord stalking you and your company? Didn’t think so.
Han Solo was a mercenary who only had one thing on his mind: money. He had debts to pay but he was also his own man. He had no loyalty to any organization, any cause, or anybody for that matter. (Okay Chewie, he was loyal to you.) Han was a Passive all the way, until his conversion at the very end.
Luke was tired of living the farm boy life on a boring planet with two suns. Luke dreamed of joining the academy to be with his friends. Before meeting Obi-Wan Kenobi, Luke was already a Promoter for the Rebel Alliance. Then Vader’s “organization” happened to murder Luke’s aunt and uncle, and bumped Luke up to a full 10—ultimately bringing down the empire.
In business, your job is simple:
- Get Vader to Passive (good luck).
- Nudge Han Solo to Promoter by doing a little bit extra.
- Learn everything that Luke loves about you and do more of that.
The answer to NPS question 2 will show you how.
The secret that binds the NPS galaxy together
Question 1 gives you an idea of what people are feeling—right now—about your organization. That’s great, but the real meat of the survey is in question 2:
“What is the primary reason for your score?”
NPS asks you to prioritize Promoters and Detractors. Promoters tell you what you’re doing right, so make sure you keep doing those things. Detractors tell you everything that’s wrong, so address those issues as soon as possible. They may even offer suggestions on how to fix things. Pay attention to responses, especially if you see common themes or similar feedback. If you notice patterns, then it’s probably safe to say that other people are affected by the same things—positive or negative.
Closed-loop feedback: an opportunity bigger than a Star Destroyer
Why is it called closed-loop feedback? Because you’re taking feedback from the question 2 and getting it into the hands of the people responsible for that portion of the customer experience.
It could be your product development team, it could be sales or customer support. But get that feedback to them as soon as possible. Once they have the feedback, the responsible person can decide whether to follow up with the customer to get more details or make the necessary changes or fixes.
If you’re unsure about the customer’s specific pain points, follow up with them for clarifications. Don’t guess.
If it’s a recurring problem or an issue that gets reported over and over, then your goal is to find the root cause and eradicate it.
Root causes or why Anakin turned to the dark side
If a specific problem is recurring, there may be something deep within your product or organization that’s causing it. The creators of NPS suggest using the 5 Whys to get to the bottom of the issue.
The 5 Whys
Toyota had an ingenious way of discovering root cause problems. Taiichi Ohno, architect of Toyota’s Production system, viewed problems as opportunities in disguise. Whenever a problem arose, he would have his team ask why a particular problem occurred. He then questioned every answer he received with “Why?” until he got to the root of the problem. (Something kids around the world have been getting right for years.)
Ohno described the “5 Whys Method” as “the basis of Toyota’s scientific approach… by repeating why 5 times, the nature of the problem as well as its solution becomes clear.”
Let’s apply the 5 Whys to the main conflict in Star Wars: Anakin Skywalker’s transformation into Darth Vader. If we apply the 5 Whys to discover the root cause, we get:
1. Why did Anakin turn to the dark side?
—Because Darth Sidious promised him the power to cheat death.
2. Why did Anakin want the power to cheat death?
—Because he had a dream that Padme (his wife) died.
3. Why did he believe this dream would come to pass?
—Because he had a similar premonition about his mother dying a terrible death (she did). He blamed himself for not saving her.
4. Why wasn’t Anakin able to save his mother?
—Because he left her to become a Jedi, leaving her on that desolate sand dune they call a planet.
5. Why did he leave his mother to become a Jedi?
—Because Qui-Gon Jinn, a Jedi Knight, thought Anakin would make an excellent Jedi. Qui-Gon bought Anakin’s freedom from slavery, but not his mother’s (probably pissing Anakin off when he thought about it more).
See? The 5 Whys are deceptively simple for breaking down a problem to its roots, potentially bringing insight to long-standing systemic issues.
In Anakin’s case, what if Qui-Gon had bought his mother’s debt and freed her too? Maybe that would’ve prevented Anakin from becoming a raging Sith. Or, how about just leave the spoiled brat on Tatooine?
In either case, it’s hard to predict who will be your Promoters or Detractors. But now you can use this tool to improve their experience.
7 steps to NPS heaven
There are 7 simple steps to implementing NPS in your business.
Step 1: set it up
Here are some things to consider before you launch your first survey:
- If you have a large customer base, how will you segment them?
- Prepare your email messages in advance. First, draft an email that will ask people to complete your survey. Then put together follow-up emails. At Typeform, we write follow-up emails for all 3 categories: the Vaders, Solos, and Lukes.
- How will you track results? Email? Spreadsheets? Some other app?
Step 2: the feedback chamber
Once you’re set, you need people to enter your feedback chamber. People are busy, so give them a good reason to participate. Give them context. If your email is compelling, they’ll complete the survey—happily or grudgingly, but it’s in their best interest. Here’s some questions to keep in mind to increase engagement and completion rates:
- How long will it take to complete the survey?
- Why are you conducting this survey?
- Why should they care?
- What’s in it for them?
Craft your email with these answers in mind. Taking your survey is an easy choice when people have good incentives.
And finally, have a handy NPS tool ready to go that looks great on any device. It needs to look inviting.
Step 3: categorize and calculate your NPS score
Let’s say you sent your NPS survey out to 100 people and 80 responded.
Out of the 80 responses, 56 scored at a 9 or 10, making them Promoters.
10 scored at a 7 or 8, making them Passives.
And 14 scored anywhere between 0 and 6, making them Detractors.
Here’s how you calculate your score:
First, ignore the Passives. The creators of this system found that if a business focused on increasing the number of Promoters and decreasing the number of Detractors, then it would magically address everyone in between.
Second, calculate the percentage of Promoters: 56/80 = 0.70 = 70%
Then calculate the percentage of Detractors: 14/80 = 0.18 = 18%
Finally, subtract the Detractors from the Promoters: 70% - 18% = 52%
The NPS score is 52. This is your baseline number, and this is the number you want to improve upon.
Note: There is no universal NPS scale to judge your company. The temptation is to compare your NPS score to others who have published theirs, but that’s a moot point. Your score is what matters most, and your job is to improve it. Compete with yourself.
Step 4: discover root causes
Read your Promoters’ and Detractors’ comments and look for patterns or anomalies. Take time to find the root cause of their problem because ultimately: it’s your problem. Don’t focus on surface issues when the underlying problem is much deeper. Things to consider:
- Is a process broken?
- Are there policy issues that need to be reviewed?
- Is this a problem with company culture?
- Use the 5 whys.
Step 5: close the loop
So the results are in and you’ve taken the time to discover root cause problems.
Now, you want to turn every Detractor into an alert that someone on your team will personally address. Charles Schwab has managers contact every Detractor by phone. They want to know what’s wrong quickly, so they can make adjustments and keep valuable clients. You may have another way to deal with Detractors, but the point is to make quick adjustments.
It’s about clarifying what’s wrong in the customer’s eyes, and what you plan to do about it.
- Learn what keeps Promoters engaged, and do more of it.
- Learn what turns Detractors off, and solve those problems immediately.
Of course, if your NPS results generate a ginormous list of problems, you’ll want to sit down with your team and prioritize. If you do a great job identifying root causes in Step 4, then your fixes will likely address multiple problems simultaneously.
Step 6: communicate changes to your audience
By now, you’ve done the hard work. You made minor or perhaps significant changes. Let your customers know. A shout-out on Twitter, a mention in the Changelog, or perhaps some love in a blog post. These are great ways to show your appreciation to others for making your company awesome.
Sure, it’s not feasible if a thousand people griped about the same problem. It might be enough to feel heard and have the changes made, but nothing beats good ol’ fashioned acknowledgment and recognition. If you can build it in, do it.
Step 7: repeat
The first time you implement NPS, it won’t be perfect. Document and record your results. Take the lessons learned, and make it better for your next run. As with most key processes in your organization, practice makes improvement.
Recap: the big picture
Here’s what this whole thing looks like:
- setup and administer the NPS survey
- consider the Feedback Chamber
- categorize and calculate your NPS score
- discover root causes
- close the loop
- communicate changes to your audience
Bring balance to the force
NPS is not just another way to keep score. Measuring yourself against organizations in similar industries is pointless. Remember, you’re competing with yourself, not others.
If problems or issues are recurring, they’re likely systemic issues. The heart of NPS addresses the underlying problems embedded in systems, processes, policies, and culture that drive your organization every day. Or as Shep Hyken says it:
NPS is like a Trojan Horse. It fools greedy executives and metric-minded founders into being more human.
Let me explain: If your organization doesn’t improve the lives of both staff and customers, it will ultimately fail. The heart of the Net Promoter System is your staff.
In other words, if NPS does its job, you will identify broken processes and workflows that normally frustrate staff. Since a poor system affects customers, don’t expect them to hang around for too long. And don’t expect staff to either.
For the leaders who “get it,” NPS will fit seamlessly into their organizational flow. They won’t resist when fundamental changes are necessary, albeit tough to implement. They’ll welcome adjustments to company culture when it makes life better for employees. Short-term profits, or “bad profits,” will be discarded in favor of the long game.
In the end, NPS is about growth. It’s about growing your people first, and the subsequent growth of the company by delivering happiness to your customers, clients, and participants.