What is NPS?
NPS stands for Net Promoter Score. Simply put, it is a measurement of your company’s customer service and your clients’ loyalty. Your score is an index ranging from -100 to 100 based on survey responses.
Why does NPS matter?
For local financial services companies, your unique differentiator is your high-quality customer service. An NPS allows you to easily gauge how you’re performing in this area. With this knowledge, you’re able to know where to make necessary internal improvements. This improves client relationships and it can also help with employee retention.
We’ve seen our clients use their score to help them scale and grow faster, because NPS is also an excellent resource for referrals. It allows you to identify the clients already most likely to refer you. Now, you’re able to trigger a referral request to the right people.
How often do I distribute my NPS survey?
This will vary by company based on the size of your client base.
When deciding this, it ultimately comes down to the type of relationships your firm has with clients. For example, a quarterly NPS survey makes sense for companies with stable customer relationships such as advisory firms. This allows you to get a more frequent pulse on your clients’ feelings toward you and your company, and it gives you time to make any necessary changes or address problems in the relationship.
For institutions that engage with customers on a more transactional basis, such as banks and insurance companies, annual surveys work well since customers might go a quarter or two without interacting with you.
How do I distribute my NPS survey?
There are several options for this. Hubspot has a specific NPS add-on that is great if you’re already familiar with that platform. There are also programs such as Survey Monkey or even Google Forms that are easy to navigate.
When you distribute the survey, you want to make sure to include a call-to-action at the end. This is a great opportunity to ask clients, especially if they gave you a score of 9 or 10, to promote your company, share kind words on your social media, or provide a referral.
What should my NPS survey look like?
Typically, NPS surveys are broken down into two parts: a rating question and an open-ended question. The rating gives you quantitative data to track over time, but the open-ended question provides you with tangible customer feedback. How you word and structure each part depends on your company, but we strongly recommend keeping all questions simple and straightforward.
For the rating portion of your survey, the standard practice follows this format: “On a scale of 0 to 10, how likely are you to recommend our business to a friend or colleague?” For those in financial services, you can make the question more specific to you by replacing “business” with “firm” or “wealth management services.”
You also have the option to ask for a rating regarding individual customer service representatives. Start by asking them to select from a pre-created list of employees or fill in the name of the person they worked with. Then, you can pose a similar question regarding how likely they are to recommend this person to others.
The open-ended portion simply asks your clients for specific feedback regarding their answer to the rating question. This can be as simple as, “Please explain your rating from above.” This is also a chance to personalize the question to your company or the type of feedback you’re looking for. For example, “How can we improve your experience with our firm?”
How do I figure my NPS score?
Your NPS score comes solely from the responses from your rating question. You can determine your score using a simple calculation:
- Determine the number of detractors (those who gave a rating of 6 or below), the number of passives (those who gave a 7 or 8 rating), and the number of promoters (those who gave a 9 or 10 rating).
- Determine the percentage of detractors and promoters.
- Subtract the percentage of detractors from the percentage of promoters to give you your NPS score.
For example, if you have 10 respondents and 20% of them are detractors and 60% of them are promoters, you would follow this formula: 60%-20%=40%. Take off the percentage, and your company’s NPS is 40. Remember, it’s possible for your NPS to be a negative number, as scores range from -100 to 100.
What do I do with my NPS results?
Once you get the data back and figure your score, you will have a better grasp on what’s going on at the ground level of your company. The results show you how your firm is performing with clients, and you are able to look at the open-ended responses for real feedback. If multiple responses praise your onboarding process, you know to keep that system in place. However, if multiple clients responded that they had difficulty navigating your website, you know it might be time to reevaluate your site’s usability.
If you format your survey to gather this specific data, you also have the option to look at each customer service representative’s individual NPS. This can be a valuable tool for employee feedback.
How do I know if my NPS is good or bad?
What’s most valuable about your score is that it’s specific to your business and client base. In the financial services world, most of the information out there is comparing big banks or national wealth management firms, which is not necessarily useful information for midsize, local companies.
General NPS guidelines suggest that any score above 0 is “good,” since that means people are more likely to recommend your company than not. Anything above 80 is then considered “world-class.”
You’ll want to look at organizations similar to yours in size and client base to best determine a good benchmark score. Companies such as NICE Satmetrix generate yearly reports that provide insight on a range of markets and industries.
Can I promote my NPS?
A primary purpose of NPS is to give valuable insight into how your clients feel about your company. However, if your industry allows the sharing of your score, then yes! Share away. Your NPS can be a great addition to marketing collateral. You will want to make sure to provide a brief explanation on what NPS is, since not everyone is familiar with it.
Whether or not it’s included in your promotional material, we suggest sharing your NPS internally, especially if you have a positive score. This boosts employee pride, but it also gives you the opportunity to reach for a higher score. Using existing data, you’re able to set benchmark goals for your company to achieve.
At Out & About, we help clients navigate how to use NPS and would love to help you do the same!
