predicting the path of your nps
Post on 27-Jan-2017
13 Views
Preview:
TRANSCRIPT
© RedRoute International 2014
Beyond Net Promoter Score
Steering your Future NPS Performance
16th October 2014
Tony Dobbs
Steve Messenger
Robert Whiteford
© RedRoute International 2014 2
And Today’s Score is….
52
© RedRoute International 2014 3
So Today’s Score is….
52
Yesterday’s Score was 54
Tomorrow’s Target is…. 58
© RedRoute International 2014
Net Promoter Score
If tomorrow’s target is 58…
What happens when the actual comes in at 47?
How was it produced & what actions are needed to get back on a positive trajectory?
Should you fix each problem one at a time - or just look for patterns?
4
© RedRoute International 2014
Net Promoter Score
Key ‘dashboard’ metric for many companies
Quick and easy to collect
Industry norms
BUT
Links between NPS and financial performance criticised*
Boards convinced but implementation challenging
Understanding of the metric often poor
5
* e.g. Keiningham, Cooil, Andreassen, Aksoy; Journal of Marketing, July 07
© RedRoute International 2014 6
Five problems with trying to use NPS
© RedRoute International 2014
1. NPS is a “Derived” Metric
Promoters Passives Detractors NPS Score
20% 80% 0% 20
60% 0% 40% 20
Different sentiments… different causes… but SAME SCORE!
7
© RedRoute International 2014
2. NPS is a “Limited” Metric
Only partial measure of the drivers of business performance
And links to actual behavioural loyalty difficult to define / measure
Like market share, a good NPS score can be ‘bought’
e.g. by incentivising respondents
Impacted by external events:
Economic trends
Competitor activities
Business discontinuities (e.g. new stores)
8
© RedRoute International 2014
3. NPS is the “Wrong” Metric
People feel loyalty to “Persil” , not to “Unilever”
9
© RedRoute International 2014
4. NPS is a “Retrospective” Metric
Based on (recent) previous experience
Senior management may respond by saying:
• “Yes but… we don’t work way any more so its OK”
10
© RedRoute International 2014
5. NPS is an “Insufficient” Metric
The best NPS score in the US telecommunications industry is 11
But best because of:
Its technology?
Its service?
Its coverage?
All of these?
Or more?
And if the score for your own telecommunications company is
below 11 – what do you do about it?
11
© RedRoute International 2014
5. NPS is an “Insufficient” Metric (cont.d)
“And what is the main reason you gave us that score?”
Even with (real time) individual verbatim responses…
Feedback seen as tactical or ‘one-off’
• Senior management not engaged
• Other departments not buying-in
• Too difficult to fix
Reflects current practice & content
• Not underlying issues / unmet needs
• Not tracking the ‘big picture’
• Limited impact at top line
12
© RedRoute International 2014
So Problems exist with NPS but…
13 * PRmoment.com **Kantar Till Roll Market Share Reports
NPS was indicating future problems for Tesco as early as 2011 – even
though Tesco’s market share in that year was at a high point of 31%
NPS 2011
Change in Share 2014 v 2011
© RedRoute International 2014
Key Issue: NPS is a Summary Metric…
CX is multi-faceted
TUQ2* highlights WTR driven by both Functional Drivers &
Emotional Drivers
Functional: Price; Accessibility;
Quality; Features; etc
Emotional: Feel good about their
relationship with the brand/company/product
14
Tesco “Value” rating on YouGov
BrandIndex™ Tracker declined
throughout 2011 : driving NPS down
If NPS is too high-level & non-diagnostic,
And individual feedback is too low,
What measures are needed?
*The Ultimate Question 2, Reichheld & Markey
© RedRoute International 2014
Beyond NPS
Is there an easier way to “see the wood from the trees”?
One that…
Maximises senior management attention & action without losing
simplicity?
Links management of NPS to actual underlying business
performance?
Leads to fixing the real cause of the problem, not just the metric?
15
© RedRoute International 2014
AIME Beyond Net Promoter Score
Using the AIME Tracker to Drive NPS - A Case Example
AIME : The Analysis & Improvement of Marketing Effectiveness
© RedRoute International 2014
Values & Attitudes
“What’s Important”
Background: Modelling Loyalty Card Data
Behaviour driven by interplay of needs, attitudes & circumstances
Behaviour
“What’s Best”
“What’s
Needed”
17
Circumstances
“What’s Possible” Academic Background:
Dick & Basu NYU
+ many other studies
© RedRoute International 2014
Motivations: Mix of Emotional & Functional
“Why people choose Brand X to meet Need Y in Circumstance Z”
*Behaviour can be of any type, e.g. from visit your web site to purchase your brand 18
© RedRoute International 2014
Know From Modelling Customer Level Data
Five Key Motivational Drivers:
Relevancy - Do I need this?
Identification - Is this a brand I would be proud to use?
Accessibility - What’s the time, effort, & cost involved?
Value - Is the benefit I’ll get worth the effort/cost?
Confidence* - What are the chances I’ll be disappointed?
19 *Sometimes termed “Risk” (of being disappointed)
© RedRoute International 2014
Does Your Offering….
Provide the Right Solution
From the Right Brand
For the Right Effort
At the Right Price
In the Right Way
ENP “Effective Net Preference”
20
ENP = (weighted) Average
© RedRoute International 2014
AIME Tracker: Measuring Perceptions
21
Formal Surveys
Top-line Surveys
Social Media Tracking
Pre-Campaign
During
Campaign
Verbatim Responses
(e.g. to “And why did you give that rating?”)
Using data from
any sources
© RedRoute International 2014
Effective Net Preference Measure
22
Decision-maker Perceptions of..
ENP
Brand 1 Brand 2 Brand 3
© RedRoute International 2014
Client Case Study (Office Supplies - Direct)
23
Right
Sol’n
2011
Right
Brand
Overall
ENP
Right
Way
Right
Price
Right
Effort
Customer
Group
Poor score on ‘Right Brand’ holding back ENP by a substantial margin (at least 5 points)
US-owned
Multi-channel
c. £300m UK turnover
c. 500,000 customers
c. 4 purchases/yr ave.
Basket Item Trx data
Track NPS globally
Working with RRI
since 2009
© RedRoute International 2014
Knew ENP Correlated with NPS
24
Simple Correlation >67%, with modelling >85%
Scales = Percentages as decimals
Willingness to Recommend is also a “Behaviour”
© RedRoute International 2014
Knew ENP Correlated with Share of Wallet
Stated Share of Wallet v Effective Net Preference (ENP)
25
Based on a customer database of >500k and a survey base of >25,000 customers
Customer ENP Score
Share
of
Wallet
%
© RedRoute International 2014
Knew ENP Predictive of Future Activity
26
Customer ENP Score
% Spending
Again in 18m
Post-ENP
Measurement
If ENP could be increased by 1%, it was estimated sales would increase by 0.7%
© RedRoute International 2014
Media Campaign to Address Branding Issue
27
© RedRoute International 2014
Impact of Media Campaign
Brand perceptions improved over a series of bursts
28
© RedRoute International 2014
Other Driver Scores Largely Unchanged
29
Feb 2011 Feb 2014
Right
Brand
Right
Brand
Right
Sol’n
Overall
ENP
Right
Way
Right
Price
Right
Effort
Right
Sol’n
Overall
ENP
Right
Way
Right
Price
Right
Effort
© RedRoute International 2014
WTR & NPS follow the Direction of ENP
30
© RedRoute International 2014
Brand Performance Recovered
Improvement in ENP created c.£18m per year extra sales
31
© RedRoute International 2014
Other Uses of the ENP Metric
32
Major UK Supermarket
© RedRoute International 2014
Implications for Managing WTR & NPS
ENP summarises customer opinions on 5 key
strategic dimensions that drive behaviours
By managing overall ENP, the future direction
of WTR, NPS (and sales) can also be managed
AIME Tracker measures ENP using your
available (big) data sources
Providing the Board with predictive diagnostics
beyond NPS creates engagement & action
It Works!
33
top related