In our experience with data modeling, a pile of money is often left on the table when customer spend data isn’t taken into account before making decisions based on NPS. Working with your data to drive more value from customer feedback There are plenty of ways that you can slice your data to better understand who’s leaving NPS feedback for your business. One way to do this is through demographic profiling: For example, let’s say we have a hypothetical company that’s collecting experience feedback from Gen Z’ers (born after 1997) and Millennials: After calculating NPS data, the results are as follows:
The NPS Score for our hypothetical business would be 20, which is the same as the Pepsi Company and just a little higher than Corona (Customer Guru). So, one might think that the hypothetical business is in good company, as they match the rankings with these staple companies. Although there may be room to improve, it’s in a solid position and is doing pretty well. However, this isn’t the whole picture — dive a little deeper to uncover more valuable insights:
Using Weighted NPS to Gain More Insight
In this scenario, the customer CLV (customer lifetime value) is $4,000 across the board for all customers, but we can dig deeper into our segmented information. Imagine that Millennials spend more than Gen Z, let’s say $8,000 and $2,000. Though 2 of the 5 sampled customers are Millennials, they account for $16,000 in LTV, which is more than half of the business. Once you add this data to the mix, the business doesn’t seem to be doing so well amongst their most valuable customer segment:
Now you can see the kind of money that’s often left on the table. When we re-calculating NPS based on the weighted revenue data, the score from our examples ends up at -18. As NPS becomes weighted, it becomes much clearer that this business could stand to lose more than 70% of their revenue if Detractors and Passives are not addressed.
How to Use Net Promoter Score to Drive Organizational Change
So we calculated our hypothetical company’s NPS, identified detractors, and we now know that these detractors are at risk of churning. By identifying the type of customers that are bringing more value, it becomes clear how the company can better target their outreach to appease their high-value customers. QuestionPro CX’s NPS Key Driver Analysis feature helps you determine which attitudes and interactions have the biggest effect on your overall NPS. Like most people, you have limited time and resources. If you’re given a week to fix your top two priorities, it is critical that you know which determinants or variables will yield you the biggest return. If you’re interested in learning more about calculating weighted NPS or Key Driver Analysis, take a live tour of QuestionPro CX.
Thanx collects and tracks NPS (Net Promoter Score) responses, allowing you to see trends in customer satisfaction over time, across your locations, and against industry benchmarks. Thanx automatically sorts through the noise to instantly alert you when loyal customers’ satisfaction is on the decline so you can reach out to rectify issues.
Interested in learning more about your top customers (and building a program that keeps them loyal)? Contact us today.