Paul Marsden's Blog

If the Ultimate Question is “Would you recommend us?” then the Ultimate Answer is the Golden Rule - treating others as you’d wish to be treated; but with a proviso - it has to make economic sense.

Fred 2 London2012.jpgFred Reichheld, architect of the Net Promoter System for generating good profits (profits based on customer smiles, not frowns) is at pains to stress that that Golden Rule needs be deployed with economic prudence.  It’s not a blank check - the Ultimate Answer is to treat your customers as you’d wish to be treated - by profitably delighting them.

But how do you create a Golden Rule organisation that grows by profitably delighting its customers?  Simple. You reward and learn from your employees as they profitably delight customers - and then spread best practice through the organisation.  Every time a customer is delighted in a cost efficient manner, share the learning across the organisation.  In other words, use your employees to create customer promoters. A smart Net Promoter company is a Learning Organisation, where customer promoters are developed from within - where employees touch the lives of customers and share what works.

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Blog Tags : b2e, bain, employee, good_profits, london2012, reichheld

Promoters are good.  Superpromoters are better.  Superpromoters are those customers who not only would recommend, but do recommend.  They are your active advocates who work as a volunteer salesforce, and drive growth by monetizing customer referral value.

Vogelaar London2012.jpgRijn Vogelaar, author, The Superpromoter and Chief Enthusiasm Officer, Blauw Research are up on stage as a superpromoter for his superpromoter concept.

Superpromoters are promoters, but promoters with influence. Social influence. And whilst some of that promoter influence derives from expertise, most it comes from enthusiasm - for you an your products.

Superpromoters are those customer enthusiasts who not only come back for more - and would recommend, but do recommend.  And their enthusiasm is persuasive and infectious.

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Blog Tags : cx, experience, superpromoters, vogelaar

Joseph_Jaffe_london2012.jpgYou’ve all heard of the marketing funnel and the AIDA model; first make your audience AWARE of what you are selling, then create INTEREST, then DESIRE and finally move them to ACTION and make the sale.

Well, Jo Jaffe thinks we need to ‘flip the funnel’ and start with the sale - first ACKNOWLEDGE your customer, engage them in DIALOGUE then INCENTIVISE further action, and then ACTIVATE recommendation and repurchase. 

For Jaffe, flipping the funnel makes basic business sense; simply ask yourself what proportion of your business comes from existing customers vs. new customers? Now compare to your marketing spend - how much is spent on existing customers vs. new customers? Is there a mismatch?

Now, ask your new customers how many came to you via marketing messages, and how many came via word of mouth?  Is there a mismatch between what you spend on advocacy activation versus AIDA style messaging?

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Blog Tags : acquisition, customer, jaffe, jaffejuice, london2012, retention, service

Don Peppers, author of Extreme Trust: Honesty as a Competitive Advantage is up on stage sharing key ideas from his latest book.

Peppers_London2012.jpgThe basic idea is that in a world of near-infinite choice, you need to differentiate on trust.  Customers buy, refer and come back for more based on how much they trust you.  So we need to understand 'trust' - what is it? 

Trust has two key components

  • Belief in competence (product competence - selling great stuff, and customer competence - relevance, insight and relationships)
  • Belief in good intentions (you work in your customers’ interest at heart)

The commercial value of trust is that trust drives loyalty and referrals, and loyalty and referrals drive customer (lifetime) value.  And custmer value drives growth. We come back to those businesses we trust, and we recommend those businesses we trust.

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Blog Tags : golden_rule, london2012, peppers, trust

As CEO of ING Poland, Tomasz Blawat is rewarded based on profit, return on equity and market share.  Not customer experience. 

Blawat_London2012.jpgBut ING’s insight is that in a crowded market customer experience is a key market differentiator - unlike product range, marketing, service, mission and vision - which are all generic commodities. 

For ING, customer experience (CX) drives business - over 50% of new customers come to ING via existing customer recommendations.  Experience that creates promoters leads to longer tenure, and a willingness to buy more.  Experience falling short of expectations leads to customers surrendering their contracts.

For ING, the NPS is a simple and smart solution for keeping the business on track for differentiating through customer experience.

As CEO, Blawat says the score itself is not important - it’s the direction that counts, and the drivers.  Using the NPS, ING has identified a number of quick CX wins as well as longer term systemic wins for improving customer experience;

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Blog Tags : blawat, customer_experience, cx, ing, london2

Philips is next up on stage, getting straight down to the nitty gritty of rolling out a succesful Net Promoter powered Customer Experience solution.

Hancher London2012.jpgRegina Hancher, Director, Customer Experience, Software Customer Service, at Philips Healthcare, outlines a simple 3-step preparation plan and 4 critical success factors for rollout success...

Preparation


  • Step 1: Partner with Internal Stakeholders (secure executive sponsor, involve functional teams, engage leaders for reporting requirements)
  • Step 2: Map the Software Customers’ Lifecycle (Interview service/maintenance employees; identify key customer touch points; specify the Software Customer Service Lifecycle)
  • Step 3: Align Survey Content (unify all existing surveys; validate questions with management, use NPS to ensure validity and reliability)
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Blog Tags : b2b, hancher, heathcare, london2012, philips

Owen London2012.jpgRichard Owen, co-author of 'Answering the Ultimate Question' and Satmetrix CEO is kicking off the 10th London Net Promoter Conference, speaking to a packed hall of delegates from 39 countries.

His theme - Re-imagining Net Promoter in the social era.

Richard zips through some of the highlights of Mary Meeker’s recent and highly influential “Re-imagined” Internet Trends report reminding us of how online technology is transformative - from music, magazines, movies, etc - wherever you look, digital connectivity means industries are being re-imagined.

Including the customer loyalty industry. 

  • First, the connected consumer is a different beast today - more vocal, more social, more influential, more ready to switch and with higher expectations. The implication, we need to work harder to earn loyalty;
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Blog Tags : experience, london2012, owen, smart, social

So the Net Promoter 2.0 conference is coming up in February (2-3) in SF, and many of you will have probably already read the new, revised and expanded edition of Fred Reichheld's business bestseller The Ultimate Question 2.0: How Net Promoter Companies Thrive in a Customer-Driven World, written with Rob Markey.

It's certainly worth reading; in my view the Ultimate Question 2.0 it is the single most significant business book recently published - both inspiring and practical it's a blueprint for business growth through 'good profits' - profits derived from enriching the lives of your customers.

But for the time-poor among you - and for those who want a quick pre-conference refresher as prep for the conference, here’s a ‘speed summary’ of the key points chapter by chapter

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Up on stage we have an inspiring talk from Philip’s Arne Van de Wijdeven, Customer Experience Director for the electronics giant.

Arne Van de Wijdeven 2.jpgHis message is simple and compelling – focus on Promoters not the Score.

Find the customers – and employees - who enthusiastically love you and recommend you – your Super Promoters, and listen, learn and leverage.

Sure, you need to resolve issues with your detractors, but by focusing resource on your promoters you open up an invaluable source of insight, develop a smart sounding board for innovation, and activate the best marketing resource you can get.

But most of all, a focus on Promoters humanizes the Net Promoter system.

Ultimately customer experience is about people not metrics – it’s about smiles not scores.  Promotion is about emotion not closed loop systems. Your super promoters are passionate customers who have the power to energize, motivate and align internal teams behind a customer experience-led growth strategy.  Harness them, treasure them and grow with them.
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Blog Tags : de, miami, nps2011, philips, promoters, super, van, wijdeven

Want a good career enhancement trick using Net Promoter? Then use this simple trick from Kathleen Stringfield of business software giant, Lawson, who presenting some smart ideas on how to leverage your promoters - customers who'd recommend you.

Kathleen Stringfield 2.jpgSimply drop a copy of The Ultimate Question (version 2.0 coming out later this year) on the desks of all your C-Suite colleagues – with a little personal note in the inside jacket.

Before you know it, you may find yourself Global Director of Customer Experience, managing your company’s newly set up Customer Experience Office.

You could also do far worse than adopt Kathleen’s practical tips for delivering a promoter-first customer experience program that drives business improvement (NPS increase 13% in 12 months):

  • Keep it simple: 2 Question Survey for 4 Business Areas (Overall Rating).   
    • How likely are you to recommend Lawson [Products, Training, Professional Services, Support, Overall) to a friend or colleague?
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Blog Tags : lawson, miami, nps2011, stringfield

Lenin once remarked that human history could be reduced to the simple question "who-whom?", who's influencing whom; whether that influence be coercion (use of force), persuasion (argument) or suggestion (example).

I doubt we'll see many card-carrying neo-Leninists at the upcoming NPS conference in my home city Miami, but I am honored to be chairing the Day 2 conference track "Influencing Who Matters", with three great speakers from Allianz (Mary Currier), Lawson (Kathleen Stringfield), and Philips (Arne Van de Wijdeven). Without revealing the content of these sessions - we hope to see you there - here's a quick jargon-free primer and 3-point plan for Influencing Who Matters.
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Blog Tags : customer_experience, miami, nps2011, social, social_media

We're seeing retailers move into social media in a big way in 2010, deploying 'pop up' social media f-commerce (Facebook Commerce) stores to create word of mouth buzz around new products (Disney, P&G, NineWest, Rachel Roy), whilst giving their e-commerce stores a social media makeover, adding customers ratings, reviews, Q&A's and forums to make their stores sticky and stimulate word of mouth.

From an NPS perspective, the key value of social media for retailers is that it activates the referral value of promoters (from 'would recommend' to 'do recommend'), and allows them to monetize that value with hard sales and new customers.  Social media also allows retailers to offer their customers an expectation-beating retail experience that not only activates promoters but creates them too.  So here's a short downloadable presentation on an NPS approach to social media for retailers - comments welcome!

Net Promoter and Social Media - A Strategy for Retailers

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Blog Tags : media, nps, retailers, social

Should Leboutin's new cosmetically-enhanced Barbie be our Net Promoter mascot?  Read on to find out...

Head over to the online Barbie store and you’ll no longer see Barbie’s infamous fat ankles. Thanks to recent laments by celebrity bootmaker Christian Louboutin, the offending ankles have been mercifully subjected to plastic surgery.

What you will find over at the Barbie site though is some smart use of social media (online media that supports social interaction and user contributions).  Specifically, you can go “social shopping” and co-browse the site in realtime with your remote Facebook friends and Twitter followers to share shopping advice and recommendations.

The result? An expectation-beating e-commerce experience that drives sales. Brands using social media to enhance the online customer experience have seen sales jump by 10%+ (see
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Blog Tags : social_media, social_networks, social_shopping

How much time do your colleagues spend chatting with friends on Facebook, brushing up their résumé on LinkedIn, perusing photos of last night’s party on Flickr or just tweeting t-shirt slogans at Twitter whilst wiling away the hours on YouTube?

Social media. It’s a business bane, a time-bandit guaranteed to suck productivity and focus from your organization. Remember that first rule of corporate survival? Don’t make me responsible for what I can’t control.  You can’t control what happens on social media (content sharing) or social networking (contact and information sharing) sites, so just don’t go there. And forget any upside; if Google can’t make money from it’s social media video sharing megasite YouTube (it can’t), what hope do the rest of us have. Better block those sites.

Sure, a healthy dose of business skepticism is advised in the faddish world of social media and social networking (remember MySpace or Friendster anyone?).  But by donning our Net Promoter goggles, a viable and sustainable business model for social media begins to emerge.

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Sometimes the term Net Promoter can seem to get in the way of a really great idea - the idea that happiness is a business model; that the best way to grow your business is to make your customers smile.

Yes, smile. Forget for a moment arcane discussions about the metric itself or the corporate babble-speak around associated business processes.  And look at Net Promoter for what it is; a business ethic that is based on the simple premise that doing business for good (delighting customers) is good for business (organic growth).

Take Chris Askew, from Lenovo who is up on stage now, talking about Lenovo’s Customer Delight Program that has substantially increased the number of smiling customers (NPS up 16%) all whilst trimming costs by 15%.  Chris’ words could be those of the great philosopher John Stuart Mill, author of On Liberty, and who developed “the greatest happiness principle” - that when faced with a choice, we must first consider the likely consequences of potential actions and, from that, choose to do what we believe will generate most pleasure

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Blog Tags : conference09, ethics, happiness, lenovo, london09

So Richard Owen, Satmetrix CEO and co-author of “Answering the Ultimate Question” is boiling down six years of research and experience in implementing high-impact Net Promoter customer loyalty programs into 10 key insights. Sweet.

Of the 10 insights, noted below for your delight and delectation, #7 is the one that I'd like to comment on - Word of Mouth Trumps Advertising.

First, my take-outs from Richard’s wisdom in a nutshell

  1. Winner Takes All – Your goal should be a Best-in-Class Net Promoter Score.  Why? NPS leaders grow faster and keep customers longer.  Compare Verizon with Sprint: Verizon NPS = 40%, growth = 13%, churn 1.1% - Sprint NPS = -15%, growth = -13%, churn = 2.4%
  2. Inertia is the True Enemy – The biggest obstacle in growing your NPS to grow your business is internal resistance to change.  You need to cultivate internal momentum with top management sponsorship to make it happen
  3. Relative Performance is All the Matters – Your NP Score is utterly meaningless – in isolation.  It’s your score relative to your (local) competitive set – and your past performance that makes Net Promoter meaningful
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20 Questions to Brainstorm your Brand out of Recession

As marketers come under pressure to do more with less, here's a practical way that a Net Promoter perspective can help.  Use the marketing logic of Net Promoter (what other people say about you is more important than what you say about yourself) to set up a collaborative workshop of colleagues, partners and promoters - and run a "Purple Cow" brainstorm.


purple cow.jpgA Purple Cow brainstorm - inspired by Seth Godin's marketing bestseller 'Purple Cow' (on the art of being remarkable) - has a single focus; how to make your value proposition(s) truly remarkable.  The rationale is simple; most products and services are Brown Cows, that is, quite unremarkable - not worth talking about.  But in order to cut through today's recessionary caution and marketing clutter, brands - more than ever - need to be truly remarkable, in the same way a 'Purple Cow' would be, truly remarkable.  This is pure Net Promoter thinking, and backed up with Net Promoter evidence - in a pan-European multi-category study last year, we found that nearly 80% of all variation in Net Promoter Scores is explained by how remarkable your customers find your product or service experience. Which explains why 80% of the 30 newest entrants to Interbrand’s top 100 brand list owe their success to selling remarkable experiences rather that advertising clout.  Experiential brains, not advertising braun is what you need to succeed in marketing today.

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Blog Tags : brainstorm, cow, godin, marsden, purple, remarkable, seth

We've all heard of Web 2.0, the database-backed social web.  But how can businesses profit from Web 2.0?  Social networks, social media and other social web services - so what?

But put on your NPS Goggles and see the world from an NPS perspective, and the value of Web 2.0 becomes clear; it's all about using the Web to add to your value proposition to beat customer expectations (the key driver of NPS).

Web 2.0 is not about what your customer can do for you, it's about what you can do for your customer.

So here's a presentation outlining three proven Web 2.0 strategies from an NPS perspective. (Click here for Dr. Marsden's presentation.)

The key insight - in a nutshell - is that Web 2.0 allows businesses to build web services rather than web sites that add to your value proposition, beat market expectations and therefore drive growth.

Think Nike+, think Lego Factory,

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Word of mouth is all about the money, the rest is just conversation (pun intended). That's the key takeout of this roundtable on Net Promoter and word of mouth; tell me how much a recommendation is worth, and then I'll think about doing something about it.

Part of the attraction of Net Promoter Score is its link to hard financials, but the NPS itself measures propensity to recommend (would recommend), not word of mouth (do recommend).

As it happens, recent European research has found that only 50% of promoters (would recommend) actually do recommend.

There are some really cool and effective tools for activating the 50% of ˜silent" promoters that the average business unit has (such as online communities), but before time and money is spent, it's important to know how much a recommendation is worth in financial terms (see The Ultimate Question by Fred Reichheld, Net Promoter Economics: The Impact of Word of Mouth

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Blog Tags : brandgenetics, economics, marsden, paper, paul, white, w-o-m

So Yahoo's social network expert Duncan Watts, author of Six Degrees, doesn't rate 'influencers'.  Armed with computer models, he's challenging the idea that innovation and marketing dollars work harder when they are invested with the trendsetting lead users in your category. Better to cast your net as wide as possible and cater to the mainstream majority ("mass seeding") rather than focus on fickle influencers and even more fickle network effects.

So what does this have to do with your Net Promoter strategy of achieving increased growth by putting the voice of the market at the heart of the business decision-making process? Well, it's all about deciding whose voice you should be listening to. Should you listen preferentially to lead users (influencers), because they act as gatekeepers to mainstream adoption, or should you listen to the mainstream majority because they make up the volume?

A case can be made for both -- but I'd add that it's the voice of the money we should really be listening to -- hardwiring the voice of your most profitable users (or the category's most profitable users in the case of new product development) into the business, rather than that of average or lead users. Why? Because it's profitable users, not lead users or average users that drive profits. If you want to segment further, then the Net Promoter Grid (below) will direct your listening to profitable promoters (because of the extra referral value they represent) and profitable detractors (because of the risk value of losing them).

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