Service That Sticks! How Memorable Service Creates Promoters
By Steve Curtin
In addition to promoters, Bain and Company also identified two other categories of customers: passives and detractors. All three categories emerged from ratings customers gave to companies in response to the question, “How likely is it that you would recommend this company to a friend or colleague?”
Customers who responded “Extremely likely” (i.e., nine or ten on a zero-to-ten scale) were labeled promoters—loyal enthusiasts who keep buying from a company and urge their friends to do the same. Those who responded with a rating of seven or eight were labeled passives—satisfied but unenthusiastic customers who can be easily wooed by the competition. And those who offered ratings closer to “Not at all likely” (i.e., six or below on the scale) were labeled detractors—unhappy customers that are responsible for between 80 and 90 percent of negative word of mouth.
Bain and Company was then able to determine a Net Promoter® Score (NPS) for a business by subtracting the percentage of customers who identified themselves as detractors from those who identified themselves as promoters. The percentage of passive customers does not enter the equation. For example, if 50 percent of a company’s customers responded to the survey question with a nine or ten (promoters), 20 percent responded with a seven or eight (passives), and 30 percent responded with a six or below (detractors), then the formula would look like this:
50 (P) – 30 (D) = 20 (NPS)
Their research over a ten-year period confirms that, in most industries, companies with the highest ratio of promoters to detractors in their sector typically enjoy both strong profits and healthy growth.
The beauty of the Net Promoter® Score lies in its simplicity. Every company can ask the question, “How likely is it that you would recommend this company to a friend or colleague?,” include a zero-to-ten scale, and then quantify the results using the above formula. Then, assuming there is integrity to the feedback (e.g., there has been no tampering with the data) and there are a sufficient number of survey respondents to support statistical validity, then results will be self-evident.
So the question becomes, how does a company increase its Net Promoter® Score?
The simple answer is to increase the number of promoters and decrease the number of passives and detractors. One way that companies approach this is to tighten their processes. That is, they attempt to improve the customer experience by increasing efficiencies, streamlining processes, leveraging technology, etc. And this is effective—to a point. The problem is that customers are oftentimes looking for more than efficiency. They are looking for customer service from an engaged employee who is genuinely interested in serving them and values their patronage as opposed to an apathetic employee who is indifferent toward them and merely going through the motions.
Leading companies look beyond processes to the personalities of their employees. While the hiring process is a critical component to ensure that a company has the right people in the right roles, beyond selection employees must be oriented and trained in customer service and held accountable to extraordinary standards. This training must focus on the relevant customer service behaviors that will enable an employee to make a positive impression on the customer—so positive that it would move the experience from transactional to memorable. Or, said another way, so positive that it would move the customer from a passive or detractor to a promoter.
In order for this to occur, employees must be aware of and practice the customer service behaviors that are associated with customer-focused and memorable service experiences. These behaviors have the power to transform a bland and uneventful process-focused transaction into a unique and memorable customer-focused experience!
Here is a true story to illustrate one of the memorable service behaviors, provide pleasant surprises:
Last summer I pulled into the parking lot of my local Chick-fil-A and noticed an employee wearing a bright yellow Chick-fil-A raincoat and holding an over-sized black and white umbrella—as it was pouring outside. At first I thought he was leaving work and heading to his car but then I watched as he came alongside the driver’s door of a car that had just pulled to a stop in the parking lot. He proceeded to escort the driver and passenger through the rain to the restaurant entrance under cover of the umbrella.
I was amazed! Now, keep in mind that my expectations of Chick-fil-A customer service are pretty high to begin with. After all, they are sort of the Nordstrom of quick service restaurants. If you have visited one of their restaurants in the past, then you know what I’m talking about—Chick-fil-A customer service is not typical of the fast food industry. Even so, I was amazed by this outstanding and unexpected act of service!
At a time when most operators in the restaurant industry were cutting back—and for good reasons: soaring food and energy costs; reduced sales due to consumers feeling the pinch of record gas prices; not to mention the recent increase in the federal minimum wage to $6.55 per hour—Chick-fil-A was raising the bar and creating promoters!
It might interest you to know that Chick-fil-A has recorded Net Promoter® Scores well above the rest of the industry. According to Bain and Company, the company has had an annual growth rate of nearly 15 percent, despite ranking near the bottom of its industry in national marketing expenditures as a percentage of sales. It also generates superior profits in the price-sensitive fast-food business while helping the average operator of a freestanding restaurant earn more than $170,000 a year—far more than comparable managers at competitors.
While most companies seek to lead their competitors in market share, only a handful will realize this position. Assuming it does not have a monopoly or dominate the distribution channel (e.g., a utility company), it will be difficult for any company to consistently lead its competitors in market share without also leading in Net Promoter® Score. In the near term, promotions and discounting can increase sales and market share but this advantage will be short lived.
As one CEO put it: “We believe that the only sustainable advantage in business is world-class customer service.” In order to achieve its long term goals, market share or otherwise, a company must reduce its percentages of customers who are either passives or detractors while increasing its percentage of promoters. The most reliable way to accomplish this is by equipping frontline employees with the skills to transform predictable, process-focused transactions into memorable, customer-focused experiences!
Steve Curtin is a customer service, training, and public speaking enthusiast based in Denver, CO. www.stevecurtin.com