How to Measure Customer Satisfaction by Mr Vivek Bindra Best Motivational Speaker

Summary

In this video, Vivek Kundra, an international corporate trainer and motivational speaker, explains the concept of Net Promoter Score (NPS) to evaluate customer loyalty. He emphasizes the importance of feedback, categorizing customers as promoters, neutrals, or detractors. Promoters (scores 9-10) advocate for the brand, detractors (0-6) are dissatisfied, and neutrals (7-8) are indifferent. The key takeaway is to calculate NPS by subtracting detractors from promoters, and strategically engage with neutrals and detractors to improve customer satisfaction and loyalty. This simple but powerful metric helps businesses measure and enhance their brand loyalty and satisfaction levels.

Takeaways

• 😀 Measuring customer satisfaction is crucial because anything that can't be measured can't be improved.
• 😀 Net Promoter Score (NPS) helps you assess brand loyalty and customer satisfaction through feedback surveys.
• 😀 Customers can be categorized into three groups based on their NPS ratings: Detractors (0-6), Neutrals (7-8), and Promoters (9-10).
• 😀 Detractors are unhappy customers who speak negatively about your brand and are unlikely to recommend it.
• 😀 Neutrals are indifferent customers who neither promote nor criticize your brand.
• 😀 Promoters are loyal customers who will strongly advocate for your brand and are likely to buy your products at a premium price.
• 😀 To calculate NPS, subtract the percentage of Detractors from the percentage of Promoters, while Neutrals have no impact on the score.
• 😀 An example calculation shows that if 50% are Promoters and 40% are Detractors, the NPS score is 10.
• 😀 A positive NPS score indicates strong customer loyalty, which is essential for a successful business.
• 😀 Addressing complaints from Detractors and engaging Neutrals can help improve the overall customer experience and boost NPS.

Q & A

What is Net Promoter Score (NPS)?

Net Promoter Score (NPS) is a metric used to evaluate customer loyalty by measuring how likely customers are to recommend your brand to others. It is based on a rating scale of 1 to 10, where the responses are categorized into promoters, neutrals, and detractors.

How is NPS calculated?

NPS is calculated by subtracting the percentage of detractors from the percentage of promoters. The formula is: NPS = %Promoters - %Detractors. Neutrals do not influence the final score.

What is the significance of detractors in NPS?

Detractors are customers who give a score between 0 to 6. They are unhappy with the brand and unlikely to recommend it. It's important to address their concerns as they can spread negative feedback and harm the brand's reputation.

What role do neutrals play in NPS?

Neutrals are customers who give a score between 7 to 8. They are indifferent about the brand and neither promote nor detract from it. While neutrals do not affect the NPS score, they are an opportunity for businesses to engage and convert them into promoters.

Why are promoters important in NPS?

Promoters are customers who rate the brand 9 or 10 and are likely to recommend it to others. They are vital for growth as they advocate for the brand, provide positive word-of-mouth, and are often willing to pay a premium for the brand's products or services.

What is the typical action for businesses to take when they identify detractors?

When businesses identify detractors, they should view their complaints as valuable feedback. Addressing the issues raised by detractors can help improve customer satisfaction and prevent negative word-of-mouth.

How can a business improve its NPS score?

To improve NPS, businesses should focus on addressing the concerns of detractors, engaging neutrals to turn them into promoters, and maintaining strong relationships with promoters. Regularly evaluating feedback and implementing improvements based on that feedback is key.

What are the benefits of calculating NPS regularly?

Regularly calculating NPS allows businesses to track changes in customer satisfaction over time, identify areas for improvement, and adjust strategies to enhance customer loyalty. It provides valuable insights into how customers perceive the brand.

What does it mean if a company has a negative NPS?

A negative NPS indicates that the number of detractors outweighs the number of promoters. This suggests that the company is facing customer dissatisfaction and needs to take action to improve its products, services, or overall customer experience.

What should businesses do with neutral customers (score 7-8)?

Businesses should engage neutrals by providing them with personalized experiences or incentives to encourage them to become promoters. Neutrals have the potential to become loyal advocates if properly engaged.