The starting point when designing customer loyalty feedback programs should be understanding what your customers care about and how well you are meeting their expectations. Unfortunately, many attempts at customer loyalty surveys fail to include all three critical elements required to collect that understanding and so fail to provide useful information to the business.
By not including all three critical elements the results of many customer loyalty surveys are worthless. Don’t get me wrong, the results are often interesting but ultimately worthless because you get results but have no idea what to do with them.
For instance, have you ever heard these comments after you distributed your results internally?
- “Gee, we scored 76 for customer satisfaction this month I wonder if that’s good enough?”
- “Wow, we improved 10 points from our last customer loyalty survey I wonder why?”
- “Oh no, our customers really hammered us on documentation but I don’t know if that matters or even how to improve it.”
Moving from interesting but worthless results to interesting and useful results is not actually that hard. In fact all you have to do is start with a customer satisfaction measurement approach that includes three critical elements.
1. Overall Customer Loyalty index/indices questions
It seems odd to me that many customer loyalty surveys never ask these key questions. They ask loads of detailed questions about the colour of this and the time it took for that. The problem is that at the end of the day you need to know how much customers like you as a business and match that to customer loyalty, i.e. profit.
Luckily this is a simple problem to solve because there are really only one or two questions that you can ask:
“How likely is it that you would recommend Company X to a friend or colleague, where 10 is very likely and 0 is very unlikely?”
This question has been popularised by the research done by Frederick Reicheld et. al. and the development of the Net Promoter Score. Analyzed correctly this has been shown to be a very good indicator of customer loyalty.
(For more information download our Introduction to Net Promoter Score)
“How much effort did you personally have to put forth to handle your request”
More recently this Customer Effort Score question has also been found to correlate well with customer loyalty. For more information see this post on “customer effort score“
In general my preference is to use the Net Promoter Score question as my experience indicates that customers consider a wider range of factors when scoring this question.
2. Loyalty driver questions
Now that you have an overall customer loyalty measurement you need to understand what drives customer loyalty for your business. To do this you need to include a set of questions that measure your performance on the different drivers in your business. The goal here is to understand how you perform on each driver AND determine which drivers are most important.
These are the most common questions you see in surveys, for example:
“How do you rate the technical competence of our staff?”
“How accurate was our documentation?”
“How quickly did we answer the phone?”
With this information and a little bit of statistical analysis (correlation and regression techniques) you can determine which elements of your business are most important in driving customer satisfaction.
3. How can we improve questions
So with the previous two question types you know your customer loyalty level, which elements of your business drive customer loyalty and your score on each element. Okay, you’re at the final hurdle you know what is wrong and what needs fixing but how do you fix it? This is where the last element comes in: how can we improve questions.
There are two versions of this question: general and specific
- General questions cast the net widely and get the top of mind response for you whole business:
“Please tell us the one thing you would like to see changed about us?”
- Specific questions are tied to a single attribute:
“How could we improve our responsiveness to you?”
Notice both types of question are open (no scores out of 10) responses. Using them you should get some good ideas about how to improve your business.
Well, now you have everything that you need to improve customer loyalty. The only thing left to do is get out and make changes to your business. Oh and then do it all over again next quarter – remember customer satisfaction is a journey, there is no perfect customer satisfaction.
For more information on Net Promoter Score and how/why it works download our free Introduction to Net Promoter Score (NPS).
Net Promoter, Net Promoter Score and NPS are registered trademarks of Bain & Company, Inc., Satmetrix Systems, Inc., and Fred Reichheld.