Richard's and Laura's Blog

Net Promoter Predictions for 2011: Part 2

info@netpromoter.com — Thu, 30 Dec 2010 05:15:07 GMT

"Who the hell wants to hear actors talk?

H.M. Warner, Warner Bros.,1927

Continuing my predictions for 2011, with the general theme of “hopefully you haven’t heard this one before”.

Number 3: The (IT) Empire Strikes Back

Information technologies are a big part of the success story behind voice of the customer programs in general. Trying to engage thousands of employees and hundreds of thousands of customers (in any kind of coordinated exercise) is generally considered to be, first and foremost, an exercise in technology enablement. Net Promoter as a discipline puts the Information Technology cat amongst the data pigeons by suggesting that everyone on the front line with the customer will be getting context specific real time reporting and closed loop support. And that’s just for starters.

Net Promoter data will create a major information resource for corporations that provides segmented attitudinal data in a scale and detail that companies have never had before. Heck, this could be the best database the company has; after all, unlike your CRM database, you know these customers exist as they replied to your survey! Data mining will suddenly seem very exciting, as will the opportunity to finally connect all those CRM data sources to your NPS data to our social media data etc etc.

Of course, all of this is non-trivial, and a lot of it will require IT assets from within the firm that have previously been out of the loop. NPS program leaders who effectively outsourced IT to their Software-as-a-Service vendors in the past will find they need a lot more internal support if they are going to make all these systems work together. And, with perfect timing, IT organizations are becoming increasingly aware that those “in the cloud” systems that their internal clients are buying outside their controls are becoming part of the information lifeblood of the business.

It’s a marriage for sure. Shotguns optional.

If you are running your Net Promoter program, expect a lot more IT department dependencies, involvement and complexity as your program becomes a mainstream information systems initiative.

Number 4: Some things won't happen

It should, in theory, be easier to predict something won’t happen than predict it will. After all, there are a finite series of things that will occur, and an infinite list of those that won’t. But there is something to learn from looking at good ideas that just don’t seem to gain traction so I’m picking a couple.

Employee Promoter Score is my first. Don’t get me wrong, I’m all in favor of employee loyalty, and just about every program should care about employee adoption of NPS. But formal employee loyalty process stays in the sidelines for most companies as they either go through the motions, or just skip the idea altogether. I know I’m going to get upset emails telling me about how great your employee loyalty program is, but all I can say is “well done, thanks for sticking with it”. My bet is you are a minority.

Equally egregious will be the lack of investment in reference programs. I love reference programs; I keep thinking that every b2b firm should have a sophisticated approach that takes known promoters and funnels them into a database which then… well, you probably get the picture. Some of the case studies are exceptional. People won’t fund it sufficiently.

Please feel free to prove me wrong on both these.

The New Normal: Another reason to be at the top of the NPS curve

info@netpromoter.com — Wed, 05 May 2010 16:06:01 GMT

Dave Rich makes the point in a Forbes article that loyalty to firms is declining, based on the commentary around Accenture’s 2009 Global Customer Satisfaction Survey. Without knowing all the details around the survey – who was asked, what products or services they purchased, etc.– it’s hard to support or deny these claims. But on the surface, it raises some interesting points.

Rich points to the fact that 69% of respondents have switched on one service or another over the last year. Let’s take that at face value and assume that this really is a change (I don’t know if it was up on prior years) or at least is relatively significant. What are the underlying factors that might have contributed to such a move?

The biggest two drivers of customers changing products, brands or services are informational barriers and switching costs. If customers don’t know about superior alternatives, they can’t choose them; if the switching costs are higher than the benefits, they won’t switch even if they might like to.

We have seen a massive change in the nature of informational barriers over the last decade as the Internet removed the last available fig leaf for businesses to avoid comparison, and social networking provoked peer-to-peer product comparisons. Even if – as I suspect – social networking is currently overstated in its impact on word of mouth (loud, but not accurate), the trend is pretty clear.

As informational barriers fall, competition increases and brand loyalty is threatened. After all, anyone making a profit is (theoretically) a signal to attack their markets. What about switching costs? Again, competition forces the reduction of these costs over time – it’s hard to lock customers in if your competitors are advertising lower switching costs and your customers are well informed of their choices.

Accenture’s observations should not come as a great surprise. The bad news is, it won’t be as easy to hold on to your customers. The good news is that it’s easier to grab your competitors if you are an NPS leader.

Bain Loyalty Forum: A Note on Sources

info@netpromoter.com — Mon, 06 Apr 2009 15:19:14 GMT

Most of the best source material for case studies and best practices comes direct from firms who are implementing net promoter programs. As you might imagine, we get quite a lot of material from the conferences and net promoter.com

But for an executive audience, one of the best events has proven to be the Bain Loyalty Forum - a roundtable of senior execs with a common NPS mission. My notes on Verizon and Logitech both came from these meetings, but these events provide a pretty in-depth view into best practice as well as building a senior network to draw on. Several folk had requested information about this, so your best bet is to contact Stu Berman at stu.berman@bain.com for information.

See you there.