By Thales S. Teixeira & Renato Mendes
There is a surefire way to increase your company’s net promoter score (NPS), or the likelihood that customers will recommend you to others. There’s also a surefire way to learn about your operational vulnerabilities using customer surveys. The key in both cases is to give customers the chance to evaluate you at exactly the right moment.
Most customer surveys, including NPS, are conducted at the very end of a purchase and consumption experience. But it can be instructive to think about what steps the customer goes through in the course of acquiring, using and disposing of products and services (what we call the customer value chain and to consider asking them to fill out the form at a different point in their journey. Any business can—and should—classify their customers’ value chain into value-creating, monetizing and value-eroding activities.
If you want your customers to do something positive on your behalf, like review your business online, make a recommendation, repurchase, subscribe or sign up for a mailing list, the ideal moment is just after their most positive experience. Why wait for the end of the experience, particularly if something negative may occur?
One of us tested this idea recently, while consulting for a fintech start-up that offers a cash-back benefit for using its online peer-to-peer payment service. We started by mapping out the typical customer value chain and measuring satisfaction rates after each major activity. After users sign up, or link their new account to their funding sources, they are indifferent. After paying someone online, they might be slightly more satisfied than when they started out, but not blown away. But when they receive funds from an acquaintance or as a cash-back deposit for a payment transaction, their satisfaction skyrockets.
Having learned this, the author advised the fintech start-up to ask users for referrals immediately after they’re told that they have received the cash deposited. This simple change was responsible for a 119-percent increase in the number of customers that referred the start-up to acquaintances. It turns out that this approach to word-of-mouth referrals works well for all businesses we have tested it with.
Thales S. Teixeira is the cofounder of Decoupling.co. Renato Mendes is a professor at Insper in Brazil and a founding partner of Organica.