Net Promoter Score is one of the hottest topic within startups and tech now. More and more startups are starting to implement a NPS system within their growth strategy to drive more user growth, retention, and engagement.
As I mentioned in my previous article, “User Retention Is More Than Just Collecting An Email“, growth is more than just acquisition. Too many growth hackers and founders spend all their time and resources on user acquisition, but left out an important part of the growth funnel: user retention. The end result is a product that attracts customers in the short term, but ultimately fails to keep them. This results in a higher churn and will slow down your company’s journey towards product market fit.
The best strategy for user growth is by improving user retention and referrals. Customer acquisition is more glamorous than retention, so it gets far more attention from online marketers and growth experts. We’ve been surrounded by myths that all investors want to see growth or an uprise in user sign ups, but to build a sustainable business, you need user retention.
There are a lot of strategies to increase your user retention and referral rate. I mentioned a few in the article that I linked to above, but I’ll be focusing on how you can leverage NPS and turn it into a growth strategy that will drive you sustainable growth.
Using NPS To Create a Referral Engine
One of the most powerful things about NPS is that you can turn it into a referral growth engine. Just sending out a Net Promoter Score survey isn’t enough. You need to follow up and keep the momentum going. What’s the use of seeing a set of data with people who selected 9 and 10 if you’re not going to use it to your advantage? You have to mobilize your promoters by engaging with them. Your promoters are your advocates. They are the people who took the time to select a NPS response and pretty much raised their hands saying that I am willing to recommend your product to my friends.
At this point, you can segment out all your promoters and then follow up with them asking them to refer your product for their friends. If you’re using YesInsights to create your NPS surveys, you can turn on our “auto follow up” feature and shoot all your promoters a discount or referral code. With this, you’ll be able to capture all your biggest fan boys and generate sales through a referral. Genuine referrals and recommendations from customers will outperform any share button or social media campaign over the long term.
Using Net Promoter Score For Testimonials
Once a customer selects a response from the NPS survey, they will be prompt to a custom landing page where they can leave additional comments. Not everyone will leave a comment, but you will be surprised at how many people actually leave one. On average, we see that 5 out of 10 people that selects a response from your survey will leave an additional comment. The ones that are promoters are more likely to leave a comment compared to the passive ones.
“One of the best ways to connect with prospects is by using stories from existing customers.” — Alex from Groovehq
It’s no secret: people tend to follow others like them. Marketers call it social proof: when we see lots of others doing something, we assume that that’s the correct behavior. Social proof isn’t everything, but it’s a good way to find a use case. For example at YesInsights, we have use cases for marketers , customer success managers , founders, product managers and many more. People might come across our site and think it’s a great and useful product, but they might not be able to find a use case immediately. This is where testimonials, blog post etc. kicks in. It helps when a potential customer visits your website and notices that another person in a similar role is using your product. That will help them think of more use cases and therefore resulting in more growth.
Groove found that good testimonials increase conversions by up to 15%. As a founder myself, I’m more likely to try and use a product with a good testimonial from someone that I know or know of that’s an industry expert. Here’s a picture of a testimonial from Groove’s site.
Now that we know the importance of testimonials and how it can help drive user growth, let’s talk about how to get them with NPS. There’s two ways you can approach this. One is by analyzing all the comments you get from the NPS survey that you sent out and then personally emailing each one to ask for permission to use their comment as a testimonial. Here’s a testimonial that we have on our page that helps with driving e-commerce companies and marketers to our platform
The second way you can approach this is by simply sending a follow up email to all your promoters (the ones that select 9 or 10) and then asking for their use case and if it’s possible to use it as a testimonial. Remember, laying a solid foundation out as early as possible is a great way to drive long term sustainable growth.
Using NPS to create a stronger product roadmap
It’s no secret, the best products with the fastest growth are the products that people love. The best products out there have a high user retention and engagement rate because users will keep coming back to it. Check out this slide by Kyle Wild of Keen.io. In the slide, he mentioned that “product is the ultimate growth hack”
No amount of growth will help your business develop if you’re losing customers because of poor product or service quality. Since user retention and growth is fueled by product quality, making the best product over time is one of the best user retention and growth strategy.
A net promoter score survey is a great way for you to dig your customer’s brain and figure out what they really think of your product. It’s a quick and effective way to measure your customer’s thoughts.
NPS can help you build a better product roadmap, but you need to take action. One of the best way to do this is by creating a NPS survey or a one-click survey based on a new feature release. So for example, your company just released a new feature that you think your users will love, this is the perfect time for you to send out a NPS survey asking them for their feedback.
I would send out a NPS survey with something along the lines of, “How likely are you willing to recommend our new feature to your friends?” This allows you to gain actionable insights on how your customers are enjoying the feature.
If the majority of the respondents are detractors (1–6), then you know immediately that this feature might not be the feature that your market wants. Instead of jumping to the conclusion of killing the feature, you can reach out to all the detractors and ask them what improvement would they like to see for that specific feature. Now you can plan accordingly and fix everything to build the ultimate product that everyone will love.
Another thing you could do is actually survey your customers prior to building the feature. You can do this by simply creating a one-click survey to ask your customers what features they would like to see being released next. This will help with the brainstorming process.
Using NPS as a way to find unhappy customers
Sustainable user growth comes with good user retention. According to Helpscout,
A typical business hears from 4% of it’s dissatisfied customers. That means that most of your customers that are unhappy with your product won’t ever speak up. Unless….you engage with them.
Sujan Patel, an extremely experienced marketer and entrepreneur, said that, “NPS is one of my favorite growth tactics. I use it two ways. First to fix detractors & passive (unhappy customers) problems by reaching out and offering help immediately after someone gives us 1–8 score. I found that 10–15% of people who answered 1–8 have small issues or user error that can be instantly fixed. It’s a very easy & a quick win. ”
One of the best way to retain a user is to provide an excellent customer experience.
3 in 5 Americans (59%) would try a new brand or company for a better service experience. One of the best ways to improve the customer experience is by reaching out to them in the quickest time frame and providing help. You’ll be surprise at how many unhappy customers will be delighted and feel happy about your product when you provide excellent and quick support.
Net Promoter Score surveys can help you locate these unhappy customers and then you can take action immediately and fix any problems that they may be experiencing. As soon as the customer feels appreciated, they’ll be more than happy to continue providing valuable feedback which can lead to a stronger user growth strategy.
Using NPS to Drive Employee Engagement and Happiness
It’s no secret, the best companies have the best talent. Talent retention is just as difficult as user retention in the startup world. It’s rare to see someone stick with a company for more than 3 years nowadays.
The best companies like WPEngine is known for being able to recruit talented people in their early days which led to a stronger growth team. An employee is more likely to stick with a company that they are proud of. They are more willing to hustle for a company that is growing. Check out this article on, “How Pandora’s Founder Convinced 50 Early Employees to Work 2 Years Without Pay” Pandora’s staffs believed in the vision of the company. They believed that there will be a bright future, which is why they stuck with the company.
To gain the maximum benefit out of the NPS system, make your employees embrace the NPS spirit by tying their actions and performances to it. Keep everyone in the loop and constantly remind them that a rise in your NPS score means that customers are appreciating their work.
Using NPS To Turn Promoters Into Advocates
After all, these customers are ready to promote you they just need to be told how or a small nudge. What I like to do is offer these customers swag (free t-shirts, mugs, etc) and ask for help they can do quickly such as share on Facebook or Twitter, write an app store review, email a friend.
Adding giveaways to your NPS strategy is another way to boost user retention and growth virally. Customers love feeling appreciated. Actually, humans in general love feeling appreciated. You can create a win-win situation with your Net Promoter Score Surveys by asking the customer for a favor and then returning the favor with a free gift. In this case, the favor that you’re asking from the customer would be for them to fill out the NPS survey.
The lifespan of an individual being employed at a startup is decreasing over time. If that individual is a fan of your product, they will bring your product onto another company and spread the word for you. An individual is also more likely to use your product for a longer duration of time if their friends are using it. Remember all those videos that we use to or still play with our friends? We play it because our friends are playing it. People use products for the same reason. They use it when they see that it solves a problem and that they see other people using it.
Using NPS for Data Analysis And Predicting Growth
Data is the bread and butter to growth. Cohort analysis, churn rate, life time value, repurchase rate etc…is super vital to every company. Data allows us to analyze the results from our test and data allows us to figure out what’s working and what isn’t.
Let’s take a look at Airbnb for example. Data scientists at Airbnb collect and use data to optimize products, identify problem areas, and inform business decisions. For most guests, however, the defining moments of the “Airbnb experience” happen in the real world — when they are traveling to their listing, being greeted by their host, settling into the listing, and exploring the destination.
So how does Airbnb’s team measure their experience? Using NPS.
“Currently, the best information we can gather about the offline experience is from the review that guests complete on Airbnb.com after their trip ends. The review, which is optional, asks for textual feedback and rating scores from 1–5 for the overall experience as well as subcategories: Accuracy, Cleanliness, Checkin, Communication, Location, and Value. Starting at the end of 2013, we added one more question to our review form, the NPS question.” — Lisa Qian (Airbnb)
The Airbnb team believes this is a more effective metric to determine the likelihood that a customer will return to book again or recommend the company to their friends. They found higher NPS scores generally correspond to more referrals and rebookings.
Airbnb team can accurately predict if their guests will rebook again in the next 12 months 56% of the time. By adding the basic information about the guest, host and trip, the predictive accuracy is improved to 63.5%. Then adding the review categories (not including LTR), they add an additional 0.1% improvement.
To sum it up, Net Promoter Score is an excellent way for you to create a sustainable growth strategy for your company. Sustainable growth is created through user retention and customer happiness. Is Net Promoter Score enough to delight your customers? Absolutely not. You can run a NPS survey and it won’t be enough to tell you everything. NPS is a great start, but it’s what you use along with it that counts. Make sure you’re following up and mobilizing your respondents. Get creative with the tricks that you can use to get the most result out of NPS. Combine NPS with one-click surveys and user research tools to get the best out of it.
If you’re looking to hear the voice of your customers and create Net Promoter Score Surveys, sign up for our free trial at YesInsights! You can follow me on Twitter @wilsonpeng8