Is the Ultimate Question Ultimately Ultimate?
May 28th, 2008
This month’s Fortune Small Business’ cover story is all about that one, all-powerful Ultimate Question. You know, the Net Promoter Score. It features a number of small businesses that have embraced the idea and are using the Ultimate Question (“On a scale of one to ten, how likely are you to recommend us to a friend?”) to grow their businesses. One company flashes the number on monitors across their entire company. Another uses it to gain a competitive edge. But the best use of it (at least in this article) comes from LearningRx, which is a company that helps clients improve their memory and concentration. LearningRx hires tutors to work with their clients and each client is asked the Ultimate Question about their tutor. Get this: Tutors who achieve a score of 90 or better get a bonus equal to 20% of their base pay.
The Net Promoter score, used in the right way, can be a powerful tool for improvement. Fred Reichheld (conceiver of the concept), says that the average US company has a NPS of 15. Yikes. And in the marketing agency world, it’s around 20. But apparently you’re doing great with 50 or higher. And then, of course, there are the rock stars, which get up into the 80s.
So are YOU using this simple metric to help gauge what your customers think about you? And remember, it’s not about customer satisfaction. Satisfaction is the price of entry and the lowest rung on the loyalty ladder. Build a company on customer satisfaction and you’re doing the same thing everyone else is doing. But built it on customer evangelism and you’ve already got a leg up on everyone else.
Other posts by Spike.
BIG Kahuna says:
I think it’s a nice tidbit but by no means real statistical research. But it never hurts to know how your customers feel. And it’s simple to ask via an e-newsletter or something.
Personally I like a bit more meat on the bone as far as research goes. If they like us why? if they don’t why? You get the point.
May 28th, 2008 at 2:29 pmTotally Consumed says:
Reminds me of the book “Raving Fans” by Ken Blanchard in some ways. Not to imply that Fred Reicheld hasn’t done an excellent job of putting usable structure to the idea; it’s just important to remember that no idea is a truly “new”. We all stand upon the shoulders of those who came before us.
May 28th, 2008 at 9:42 pmStephen Denny says:
Spike: on a scale of 1 to 10, how would you rate your second favorite credit card’s customer service? Your cable TV’s reception picture quality?
My problem with this kind of metric is that the point is valid but the execution is fluffy. Ask someone face to face and you’ll get a higher score simply due to social pressure. Surveys will catch the mood of the recipient but not necessarily the real score.
If you can determine how many people your cusomter has actually spoken to about you (without making it awkward for your customer - they simply may not want to divulge their own rolodexes), you’d get closer to the truth.
May 29th, 2008 at 6:48 amB says:
Hmm i’m not really sure either. Some people will always be more generous than others and more satisfied with product/service. I did find a debate on it here though: http://www.debatewise.com/debates/460 maybe that will help…
July 25th, 2008 at 3:12 am