Which is more valuable to your company: a repeat customer, a new customer or a lead?
Most marketing efforts focus on the third option, aiming to turn a good lead into sales and gain a new customer while relying on customer service to convert that new customer into a repeat one.
Choose your tools wisely! Discussions in the information technology business around the best framework, programming language, and operative systems should be thought around efficiency
Since a loyal customer can mean up to 30 times as much revenue as the average new customer, can marketing use loyal customers as a marketing tool? You bet it can.
What Is Net Promoter Score (NPS)?
Your company’s NPS comes from asking your leads and customers: “On a scale of 0 to 10, how likely would you be to recommend (company name)?”
From here, you’ll want to calculate separate NPS from leads and customers. To calculate the score, divide the respondents into three categories based on their survey answers:
- Promoters: Those who answered 9 or 10. These customers will recommend you when asked by a friend or business associate.
- Passives: Those who gave you a 7 or 8. They hold a neutral position about your company. They are neither likely to encourage nor dissuade potential customers.
- Detractors: Those who responded 0 to 6. These respondents will discourage others from purchasing from your company.
To get your NPS, subtract your percentage of detractors from your percentage of promoters. This should give you a score that can range from -100 to 100. While your exact score doesn’t carry a lot of significance, the higher, the better. Lower scores can mean you are not doing a very good job keeping your customers engaged and/or providing them a pleasant customer experience.
It is important to have a baseline number in order to learn and evaluate how you can move forward with marketing plans based on this.
How Can You Use NPS for Marketing?
One key piece of knowledge you gain is to know who your best customers are and who are your promoters. As you establish a better profile of your promoters, you can create a better profile of new leads. After all, the marketing department’s primary function is to generate new leads. So if you can learn who your best customers are, you can target similar leads.
Secondly, put those promoters to work for you in finding new leads. Give your promoters incentives to recommend your company. These are more likely to be solid leads than those you generate through other expensive marketing options. Word of mouth is the marketer’s best friend.
Don’t give up on those passive customers. A little extra attention can propel them from passives to promoters.
Rather than spending time and resources converting detractors, perhaps is better to cut them loose. Not only may they soften their negative opinion about your company once they don’t hear from you, but it will also free more time to target customers who are more likely to continue buying from you.
From your promoters, you gain clues about the type of leads you should pursue. At the same time, you can also learn from your detractors the kinds of leads that will waste time and resources.
The final step is to conduct follow-up surveys to see how your altered efforts are doing. Depending upon your products or services, you could consider a quarterly, semi-annual or annual NPS survey. This will allow you to continue building your baseline, gathering important customer data, and continue to enhance your demand generation campaigns.
In order to shape the customer’s opinion early and provide better customer satisfaction, read Marketing Strategies for CSPs to Enhance Customer Experience