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5 Benefits Of NPS: Why Use It Over Other Customer Satisfaction Software

Are you thinking about whether to invest in a net promoter score to improve your business? Then you are at the right place. Various companies use NPS to measure customer satisfaction and the reasons to implement NPS are many.

An example is a study by Bain & Company, which establishes a link between organic growth and a company’s NPS relative to the relevant competitors in its industry.

Net Promoter Score – the best customer loyalty metric

NPS gives you an idea as to how your customers feel about your company, but more specifically it measures customer loyalty. NPS is based on a single question covering a customer’s overall experience with a company:

How likely are you to recommend our company to your friends and colleagues?

Recommendations are still the best way to acquire new customers. And if they are willing to refer then you have nailed your service. With NPS, you can know about these recommendations, measure Customer Loyalty, and use the score to compare it with those of your competitors’ customers.

I am going to explain why NPS software is amazing and better than other customer satisfaction survey software. So, let’s begin:

When Should You Start Using NPS?

The answer is sooner the better. Your company will begin to know your customers the faster you start using NPS. By implementing it sooner, you gain insights regarding your company’s strengths and weaknesses early in the customer’s journey.

When Is The Best Time To Send An NPS Survey?

  • After a Purchase: With the experience of their recent purchase in their mind, sending the survey to the customers after the purchase helps you gain an understanding of the initial impression your company is providing.
  • After the free trial: When the customers use a free trial and discontinue their subscription of your service, it is a good indicator that there is something that they don’t like. You can use an NPS survey to find out the reason.
  • After discontinuation of your service or product: If a long-time customer decides to stop using your product or service, you can re-engage with them through NPS to figure out why they discontinued and get their feedback.

Benefits Of NPS Over Other Customer Satisfaction Software

Net promoter score is simple and at the same time it is a relevant metric for the organizations. It provides a simple solution to the complicated matter (which is measuring customer loyalty and satisfaction).

1. It increases customer loyalty

According to the research made by Temkin Group in 2016 published research found a link between NPS and customer loyalty. After doing analyses of 291 companies in 20 industries, it established the importance of NPS. The research showed that promoters are the greatest asset for a business and are:

  • 5 times more likely to purchase more goods and services.
  • 7 times more likely to forgive brands for errors.
  • Likely to recommend an organization to at least 3.5 people.
  • 9 times more likely to try new product offers from businesses they love.

Temkin also states that NPS helps businesses make smart and informed decisions. It allows you to know a calculation of your current performance in the minds of the customers.

For NPS to be successful you need to ensure everyone in your organization is in sync with the process and has access to the customer feedback. And mainly your business implements processes to know customer feedback. And finally closing the feedback loop with your customers to let them know that their feedback is implemented.

2. Get insights from your customer feedback

According to studies, over 78% of purchase decisions are made based on peer-to-peer recommendations and only 14% are based on advertisements. This human inclination to share customer experiences will not go away, so it’s best to know how to leverage it to your benefit.

The focus should be on insights that you get from your customer feedback, rather than on the score.

So, using the net promoter score software to send surveys and gather feedback is the first step to gaining necessary insights. But it’s not everything.

For example, if you did certain things to increase the NPS metric and it did work out, how do you know which of the things worked and got noticed? NPS will help you if you add a follow-up question to the survey. The response to the follow-up question will help you get real customer insights and the why behind the ratings. With this information, you will get to know which things worked and which did not.

3. It works for every business

NPS’s -100 to +100 scoring system is easier to understand, which makes it easier for other people to have a better understanding of the score. And because NPS is a measure of your whole business, it is a KPI relevant to everyone and not just a specific team.

An amazing NPS reflects that your business is doing everything correctly, from the initial front-line staff to the product, customer support, and marketing. Likewise, a low score indicates that there are some things that need to be improved which is why you need to ask follow-up questions.

Research shows that excellent customer service is likely to happen when the employees are engaged in their work. A strong NPS provides insight into staff satisfaction as well.

4. NPS is simple to implement

According to a customer perspective, NPS surveys are quick and can be done online via email or SMS. There is only one question: “How likely are you to recommend this business to a friend or colleague?” This is often followed by one or two supplementary questions to encourage feedback. The survey doesn’t take more than five minutes to complete.

From a customer perspective, NPS surveys are quick, straightforward, and can be done online, by email, or over the phone. There’s one main question: “How likely are you to recommend this business to a friend?”, often followed by one or two supplementary questions to encourage further feedback. All up, the survey rarely takes more than two to five minutes to complete.

Coming to the business side, NPS breaks down your scores into three categories: detractors, promoters, and passives. A simple calculation can help you determine the score, the formula of which is (percentage of promoters minus percentage of detractors).

5. It provides you with the big picture

CSAT and CES surveys are sent to the customers when they buy or use a product. These surveys are only relevant to the customer’s last interaction with a business. They only capture short-term customer satisfaction data, for example after a service ticket, and not the complete customer’s relationship with your business.

An unhelpful service call will result in poor CSAT or CES insights when a customer evaluates that single interaction. But loyalty is a long-term emotion. Customers might still like the product and the company based on the overall experience over the years. This is what NPS reveals, the customers’ sentiments towards your business based on their overall experience and relationship with the company.

Major Differences Between CSAT and NPS

The main difference between CSAT and NPS is that customer satisfaction survey software measures short-term happiness following recent interaction with a brand, whereas NPS focuses on overall brand loyalty and customer satisfaction.

Let’s check out the main differences between CSAT and NPS:

  • NPS and CSAT surveys serve different purposes

A CSAT survey measures how satisfied the customer is with the specific areas of your business such as customer support, onboarding process, or the new feature. It gives you an idea of which areas you need to improve or which ones are performing well.

Whereas,

An NPS survey measures overall satisfaction with your brand as a whole. The Net Promoter Score is an indicator of customer loyalty and helps you predict long-term business growth.

  • NPS provides macro and CSAT micro-level metrics

CSAT survey allows you to analyze interactions at a micro level whereas NPS measures macro-level insights. Therefore, implementing NPS is beneficial in the long run and gives you a sense of how well or bad you are doing with your service.

Conclusion

As you can see the ample benefits an NPS offers, so it is a crucial metric to measure customer feedback and is better than CSAT or CES. So an NPS Software is a better choice than customer satisfaction survey software in many cases. By implementing NPS correctly in your business, you can increase the chances of having promoters and gaining new customers.

Author Bio: Sonika Aggarwal is an experienced Content Marketer and Digital Strategist. With 5+ years of experience in the SaaS Industry, covering customer experience, customer satisfaction, customer satisfaction, and NPS. She loves to read and network with like-minded people from the SaaS industry in her free time.

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