In the quest to acquire new business and clients, small & mid-sized BPO / IT companies look to explore all possible options: social networking, direct mails, cold calling, conferences and outsourcing consultants. However, most of them fail to utilize the existing client network and never check for recommendations and referrals.
Net Promoter Score (NPS) is a powerful tool not only for analyzing client satisfaction but also new business acquisition.
NPS is based on the fundamental perspective that every company’s customers can be divided into three categories: Promoters, Passives, and Detractors by asking one simple question:
How likely is it that you would recommend [Company X] to a friend or colleague?
Companies can categorize their clients in three groups based on their response on a 0 to 10 points rating scale:
- Promoters (score 9-10) are loyal & enthusiastic customers who will keep buying and also refer others helping your company grow
- Passives (score 7-8) are satisfied but unenthusiastic and cannot be considered as loyalists. They are vulnerable to competitive offerings
- Detractors (score 0-6) are unhappy customers whose criticism and negative feedback may discourage new customers and hamper your company’s reputation
So, NPS is the result achieved when you survey your customers with the “Would you recommend our products / services to others” question.
These ratings help you get a clear measure of your company’s performance from the client’s perspective. Not only does it give an opportunity to work on the improvement areas and increase the number of promoters, it also allows you to explore business expansion opportunities with the same client or seek referrals and introductions.