It’s easy to get misled by all the chatter when researching cloud service providers (CSPs). Most tout their technology and “best-in-class solutions.” Few tout customer loyalty which is exactly what Net Promoter Score (NPS) measures.
I’m amazed by how many cloud consumers have never heard of NPS. I often find myself giving NPS tutorials to them and I stress the importance of factoring it into their evaluation of CSPs. Technology and solutions matter but what good are they when the level of service behind them is abysmal?
I want to educate cloud consumers on the basics of NPS for two reasons. First, HOSTING believes customer loyalty is every bit as important as our technology and solutions. Second, we take great pride in having an industry-leading Net Promoter Score – more on that later. Let’s start with basics of NPS.
What is Net Promoter Score?
NPS quantifies the level of customer loyalty by asking one simple question…
How likely are you to recommend our company to a friend or colleague?
Pretty simple. So simple that NPS has become the defacto standard for measuring customer satisfaction for most service-oriented companies.
Be sure to ask your CSP candidates about their NPS transactional scores. If they aren’t using NPS, think twice on selecting them for a couple reasons. First, you have to question their commitment to customer service. Second, you’ll have no consistent way of evaluating its level of service relative to the competition.
If they are using it, its vital to understand the difference between a good and bad score so please read on.
How NPS Works
Have you ever been asked to take a brief survey following a customer service interaction? Chances are, the company asking you is using NPS. These surveys typcially ask that one simple question – “How likely are you to recommend us?”
Based upon the score you provided, you are considered a promoter, neutral or detractor customer. Here’s how the math works:
What’s a good Net Promoter Score?
The first point to understand is that the NPS scale ranges from -100 to +100 based upon the above formula. A score that is below 100 means nobody would recommend your company. Conversely, a score that is higher than 100 means everyone would recommend your company.
With that understood, I’ll now provide my own view on how you should look at NPS transactional scores based upon a decade of experience working in a number of CSPs using NPS.
NPS Transactional Scores below 30
Beware of any CSP with a score below 30 because they are early on in their NPS journey. The good news is they’ve implemented NPS. The bad news is they have yet to master the principles of turning hard truths into actions that drive real and meaningful improvements to customer satisfaction. This can be due to a variety of reason such as staffing levels, process and systems immaturity or bloating. Let’s not forget the importance of having a service-oriented culture and good leadership – either or both can be challenges for a company with transactional scores below 30.
NPS Transactional Scores between 30 and 50
These are companies with a commitment to using NPS to drive a service culture and are maturing in the principles of delivering a superior customer experience. They haven’t mastered them for many of the same reasons identified above but they are making progress on their journey. Proceed with caution here. Get a good feel for the team that will be supporting you to ensure you’ve got the right mix of skills, experience and commitment to your business.
NPS Transactional Scores above 50
These companies have the highest level of commitment to providing the best customer experience. They’ve built a service-oriented culture and are discerning in their hiring practices. They constantly invest in technical and soft skills training to ensure requests are handled quickly, accurately and with a smile. They emphasize, measure and reward customer satisfaction over call-handing time. They immediately swarm on detractor customers and take the appropriate actions to flip them back to promoters. They understand all business is personal and are known to send flowers to a client who is having a bad day. These are companies with an attitude and commitment to providing the best customer experience.
So what is HOSTING’s NPS Score?
We promote NPS alongside our technology and solutions because we believe providing a great customer experience is every bit as important as our technology and solutions.
We don’t claim to be perfect with an industry leading score of 60. When we’re not, we take accountability and action quickly – this is the vital key to a best-in-class Net Promoter Score.
How we do it
Consistently achieving an NP score of 60 or higher didn’t just happen – it’s been a journey for us.
The critical first step was to build a strong service-oriented culture. If you’d like to learn more, please check out this on-demand webinar, How You Can Create a WOW Service Culture featuring my boss and COO of HOSTING, Joel Daly.
There is obviously more to it than just having a service-oriented culture. In my upcoming blog posts, I’ll address some other key things we’ve done on our journey to 60 and beyond.
One final footnote…
If you think those surveys you are asked to take don’t matter, think again. Any company seriously committed to providing the best customer experience will be swarming all over you if you give them a detractor score. Whether or not they do is just another way for you to evaluate if you should be doing business with that company.
More about NPS
NPS was introduced by Fred Reicheld of Bain & Company and Satmetrix. If you’d like to learn more, I would recommend reading “The Ultimate Question 2.0” by Fred Reicheld.