Organizations have many assets which may not be measurable. Among these corporate assets are employees and customers. Arguments can be made as to which is more important, and points on each side are valid as the nature of the discussion is subjective. However, what is not arguable is that customers and employees make up a large portion of the organization’s value. Without customers, there is no business as there are no revenues. Without employees well trained to satisfy customer demands, there are no returning customers and therefore, lower revenues. Businesses cannot survive without customers and well-trained employees. While most well-run companies develop and implement employee training programs to ensure high customer satisfaction, organizations can also develop customers to serve as promoters.
To determine the type of customer that businesses have, organizations use a scoring system called Net Promoter Score (NPS). NPS is an indicator that measures customer loyalty by asking targeted questions and then provide a score to determine the categorization for customers. Common options to determine a net promoter score include email, websites, or survey services such as Survey King. This type of information is critical as most general customer satisfaction surveys do not provide enough clarity as to the level of loyalty that a customer has. Loyal customers promote the brand, and it should be the goal of every business to develop loyalty.
All customers can be divided into three categories including promoters, passives, and detractors. Promoters are those whose behavior moves beyond being satisfied customers. This group defines loyalty and purchases products or services more than once, while also speaking in a positive manner about the experience and the company to anyone who will listen. These customers always respond to surveys and will always offer constructive suggestions. They are the best type of customer and organizations should train employees to develop these types of customers and endorse those that continue to create promoters.
Passives are customers that just make a purchase and do nothing else. The return rate for these types of customers are lower than promoters, and they are satisfied, but not loyal. This customer will not promote the business on an active basis, and when they do, they will reference the business with little to no enthusiasm about products and service. Passives will be drawn to competitor discounts and will purchase based on price or convenience without any sense of loyalty.
Detractors are the opposite of promoters and will say negative things about the company to anyone that will listen. These will take the time and effort to place negative comments on social media and will show dissatisfaction. Feedback obtained from these customers will be of little use as it will not be constructive, and they focus on feeding negative comments. The behavior of this group often has a negative impact on employee morale. Organizations need to focus on determining why this customer is dissatisfied and fix the problem at once.
An NPS score is just the start. Once a business learns and classifies customers, the work begins. Organizations must determine what issues plague the company, its products, and/or services and create ways to avoid detractors while creating promoters. Also, the business must also obtain insight as to how to push passives toward promoters. Most of the significant insight will come from the promoters and detractors because both groups will provide more feedback. Regardless of the results, businesses need to have a plan to confront the negative situations and turn them into opportunities for growth. The idea is to gain an understanding while avoid being defensive, so that all customers feel important and considered positive to the organization.