Seeds of Growth - Net Promoter Score

Get Your Helmet Mounted Cueing System Now!

Dave Free — Fri, 16 Nov 2007 10:23:15 -0700

The F35 is an amazing jet. It can reach mach 1.6 and then stop in midair and hover while landing on the deck of an aircraft carrier in rough seas. You can see it in action here . For more than 50 years the Air Force has provided its pilots with "head up" displays so that the pilots can monitor key indicators they need without taking their view off the horizon. I guess when you are going mach 1.6 and dealing with an enemy it is pretty important not to take your eyes off the horizon. The Air Force is now testing new technology to replace the head up display specifically for pilots of the F35. According to a recent post on CNET, the new system uses infrared to actually let the pilot look right through the floor of the aircraft. It also displays the feedback that pilots need no matter which direction they are looking. The company that is developing the new technology calls it a "Helmet Mounted Cueing System."

So your business is moving along pretty fast, wouldn't it be nice to have a Helmet Mounted Cueing System to help you make better decisions? What information would you want on your cueing system? I don't think you'd want to clutter it up with important but not critical information. For example, I don't think I'd want to wander around with a copy of my latest balance sheet always in front of my eyes. The current cash balance in the bank, on the other hand, might be very useful. I don't know about you, but sometimes every second counts in getting a deposit to clear before payroll starts hitting! How about some indicator of how your customers are feeling? After all, everything we do as business owners is (or should be) about making customers happy so that they will buy from us again and again and tell their friends. Seems like knowing what they are thinking about our business and what they really want from our business should influence every decision we make. What else would you add to your HMBICS (Helmet Mounted Business Information Cueing System--got to have an acronym if we want to get any government funding!)

If you're not quite ready to pull on the Star Wars helmet (your customers might turn and run), you might check out our sponsor product, Promoterz. Right now--without government funding--you can keep a pulse on how your customers feel about your business. There is no head up display, but your customers' comments will go directly to your email so you will always be in touch and better able to take your business to mach 1.6!

The average American consumer discusses brands 56 times a week. Are they discussing yours? Learn more

The Power of Realtime Feedback for Your Business

Dave Free — Tue, 23 Oct 2007 09:30:26 -0700

When I get in a car my goal is typically to get from where I am to where I want to be as fast as safely possible. To do that, I primarily use one gauge on the dashboard: the speedometer. Sure every few days I have to pay attention to the gas gauge and, if the car doesn’t seem to be behaving as it should I glance at the other gauges but the majority of the time it is all about the speedometer. WIth my goal being to get to my destination as fast as possible I try to keep that speedometer at (or slightly above) the speed limit.

I rented a car the other day with a new feedback mechanism that completely changed the way I drive. The car was the Nissan Altima Hybrid. I don’t own the car ( the car I own is more of a truck—it has a V10 and can easily pull up the mountain into Flagstaff at 85 mph—but that’s a post for another day and perhaps a different blog). I ended up driving the Altima because the rental car company gave me a free upgrade. I drove it for 4 days in the bay area. The hybrid Altima is rated at 42 mpg. It’s got all kinds of high tech stuff under the hood that switches back and forth between and electric power and the combustion engine and delivers great efficiency. All that stuff is very cool and seemed to work very well, but the thing that saved the most gas for me was a new gauge they added to the dashboard. The gauge was a real time mpg indicator. It was cool. I could always see exactly what kind of mileage I was getting. If I pushed the pedal down to pass, the mpg indicator would drop down into the the 8 to 9 range. When I coasted down a hill it would shoot up to 80 to 90 mpg. I found if I kept it steady I could get to a nice cruising speed and still be getting over 40 mpg.

That one additional bit of information completely changed the way I, the proud owner of a V10, drove. Yes, I still wanted to get there as quick as I could but I found myself balancing that goal with the goal of maximizing my mileage. Now I know that each time I fill up I could do the little calculation and figure out what kind of mileage I got, but the fact is I don’t. Why? Because by that time, the decisions have already been made. I admit it, I am short sighted, but I have never filled my tank with gas, calculated my mileage and said, “Hmmm, I better drive slower.” On the other hand, the real time mgp gauge on the Altima had me driving slower—not always, but certainly more often,

How does that apply to your small business? What feedback mechanisms do you use to monitor the success of your business? Traditional accounting measures are like calculating your mpg after the fact. Everything is history. Sure it is a good number to know, but by the time you know it, it may be too late to influence the behaviors that need to be changed to improve it. Forward looking indicators like sales forecasts and other budgets are more like the speedometer, but even these indicators don’t give what you really need to run your business. What you really need to run your business (in conjunction with the other measures) is a realtime indicator of how your customers feel about your business. You need realtime customer feedback. You may think you know what your customers feel, want and need, but I can guarantee you that unless you are asking your customers and listening, what you think you know is wrong. I can also guarantee you that, just like the realtime mpg gauge changed my driving behavior, realtime customer feedback will change your behavior and the behavior of your staff for the better. Give it a try, you will never go back.

Anybody know where I can get an aftermarket mgp gauge for a V10?

You work hard to make sure your customers are happy. Don't waste happy customers. How easy is it for your customers to share with their friends? Learn more

The Negative Impact of Word-of-Mouth

Dan Crites — Mon, 21 May 2007 17:23:06 -0700

I listened to a story on NPR this afternoon about the negative impact of bad word-of-mouth, you can listen to it here. Very scary. This is part one of a two part story by Wendy Kaufman, hopefully the second part will bring out the positive aspects from good word-of-mouth.

The basis for the article comes from research by the Wharton School of Business. They found that 1 out of 2 customers has a customer service problem when they shop. Worse is the fact that they then tell friends, family, and colleagues about it and embellish the story in the retelling. The overall result is that 1/2 of those that hear the bad news story won't shop at those places they heard about. Ouch! Those that improve on the situation certainly create a business advantage.

It goes to show the need for businesses to hear from their customers, the bad news as well as the good. Hearing the bad news you can make efforts to correct the situation so that bad embellished stories won't be spread. You even have the opportunity to turn a detractor into a promoter. You can also get to the root cause and fix it to reduce future bad experiences.

If you are not regularly staying in touch with your customers someone else will. How do you stay in touch? Learn more

76% Think You Are a Liar

Dave Free — Mon, 06 Nov 2006 17:13:45 -0700

The Word of Mouth Marketing Association has some great statistics and presentations available on their site. The title for this post comes from the finding that 76% of consumers think that businesses don't tell the truth in advertising. That fact and other nuggets can be found in this presentation.

The obvious follow on question becomes, who do consumers trust? The answer is also obvious: each other. From the same presentation 92% cite word of mouth as the best source for new product ideas, up from 67% in 1977. The fact is that as the marketplace clutter continues to build, word of mouth becomes more and more of a necessity to grow a business.

I posted a few weeks ago about the Hawthorne Effect and the role it can play in helping to develop advocates or promoters for your business. Dr. Paul Marsden of the London School of Economics, has written extensively about the Hawthorne effect and how Consumer Advisory Panels can be a tool to harness the power of the Hawthorne Effect to increase word of mouth.

We like the way Paul thinks and decided to do some testing of our own to see what business owners think of Consumer Advisory Panels, the Hawthorne Effect, and our system Promoterz, which can be used to setup and manage online consumer advisory panels. If you are a business owner and would be willing to take a few minutes to share your thoughts with us, we'd love to know what you think. Click here. You'll be asked to watch a brief video and answer five quick questions.

Get customer feedback, generate referrals, and increase repeat sales for as little as $50 a month. Learn more

More Buzz for Promoterz

Dave Free — Fri, 22 Sep 2006 16:38:04 -0700

Couldn't resist pointing you to some more great things being written about Promoterz (c'mon, it's our baby! what do you expect?)

Robert Kingston over at Small Business Branding, posted a terrific "how to" on getting your message right and getting it out. He includes this about Promoterz:

If you take a look around now, a lot of businesses are realizing how beneficial WoM is for promoting their message. One such business I admire is called Promoterz who advocate the importance of being remarkable and worthy of your customer’s attention.

Zane Safrit is CEO of Conference Calls Unlimited and maintains a blog worth reading. He checked out Promoterz and had this to say:

Interesting service. I liked it. I REALLY liked their video. For a small company, getting started, running fast and being completely dedicated to their customers' immediate needs...this is the tool, I think. It incorporates the power of Fred Reichheld's Net Promoter Score and The Ultimate Question with a standardized, but flexible, program to stay in touch with your customers, follow-up, generate reports, extend special offers, etc.

Need we say more? Watch our REALLY cool video.

Get customer feedback, generate referrals, and increase repeat sales for as little as $50 a month. Learn more

Online Communities: It's About the Net Promoter Scores

Selling to Small Business — Thu, 14 Sep 2006 01:54:11 -0700

It takes a deft hand and a lot of guts to do word of mouth marketing (WOM) online. Alice LaPlante makes these important points over at the Click to Sell blog at Small Biz Resources:

"…[M]ost of the people promoting WOM marketing — and mostly, these are people with something to sell you — are either naive or deliberately omitting to explain to you two key points:

You have no control over your marketing message when using genuine word-of-mouth techniques. Concerned? Get over it.

If you ignore #1 and try to control word-of-marketing messages, your efforts will backfire. Inevitably.

Regarding point No. 1: Say you start a message board (or pay a third party to do it for you) where customers can talk to each other about your products and services. Be aware that people are going to be completely candid. They'll complain. Kvetch. Broadcast their woes (perceived or real). You must be prepared to swallow the sour with the sweet.

Point No. 2 is closely related. Say you try to edit or in any way control the discussion. The credibility of the forum — and of your company — will immediately evaporate. Worse, there could be a backlash. You could lose what otherwise would be loyal and evangelistic customers. Members of the forum could take their very opinionated opinions elsewhere."

I think Alice makes great points about the need to be realistic. Still, I encourage setting up online communities for your customers. Why? One reason: while you cannot control the message, your customers and the public are talking about your company anyway.

True, it may be terrifying to think of setting up a venue for your customers to talk about your company. But in the end, you can at least better monitor what they are saying. You also may learn some valuable feedback to improve your company's performance.

Consider this, too: if you make enough helpful resources available to your customers as part of the venue, and if it becomes a useful enough place for customers to find new tools and tips, the net effect will be positive.

In other words, don't just set up a discussion board and call it a day. Make sure the discussion board is manned with experts who can add value that cannot be found elsewhere. Employees who participate and answer substantive questions (not trying to control the discussion, but simply answering complex product questions) can be a big draw for customers — they WANT to hear from employees. Provide links to helpful information sources, and so on.

In the end, for the customer it boils down to WIIFM (what's in it for me). Customers will flock to your community eagerly and have good vibes about it, if it helps them. The positive impact will outweigh the downsides.

Think of those net promoter scores. The goal should be to try to get the highest percentage of positive promoters of your company versus detractors.

It should not be about trying to bury or ignore negative comments. In today's open Web environment, that's a losing battle.

Promoterz is the hands-free, word-of-mouth marketing service that takes care of the details so you can focus on business. Learn more

Reichheld on Employee Loyalty

admin — Thu, 13 Jul 2006 09:08:30 -0700

How happy are your employees?

After reading that quote from Net Promoter evangelist Fred Reichheld, I immediately thought of a lesson I learned first-hand from my Starbucks days …

“Many marketers view employee relations as a job solely for human resources—they see employees as tools. But employees—happy, rewarded employees—can work wonders for the company’s marketing efforts. There is no better spokesperson for a company, product, and brand than someone who is happy with his job and respected by his employer and peers. A happy employee will in turn, make customers happy. [Source: TRIBAL KNOWLEDGE (Kaplan, 2006)]

(Author: johnmoore (from Brand Autopsy))

A disgruntled customer is 5 times more likely to tell their friend than you. On average they'll tell 4 friends. Wouldn't you like to be in the loop? Learn more

Fred Reichheld on the Ultimate Question

admin — Thu, 08 Jun 2006 05:48:21 -0700

In his latest Cool Friend interview, Tom Peters talks with Fred Reichheld, Director Emeritus of Bain & Company. Throughout a distinguished career, Fred Reichheld's consulting work and research have focused on helping clients achieve superior results through improvements in customer, employee, and partner loyalty. In the June 2003 edition of Consulting magazine, Mr. Reichheld was included on the list of the world's top twenty-five consultants.

In his latest book, The Ultimate Question: Driving Good Profits and True Growth, he explores how companies can increase customer loyalty in order to drive revenue growth and create lasting value. With so much attention now being paid to customer-centric innovation and the customer co-creation process, it's interesting to hear Fred's take on the important relationship between corporations and consumers. In fact, as Fred points out, there is only one ultimate question that companies should be asking their stakeholders: "How likely is it you would recommend us to a friend?"

During the interview, Fred explains the difference between good profits and bad profits (e.g. the skyhigh costs that hotels charge customers to use the telephone) and describes how to think about the three different types of customers: the promoters, the passively satisfied and the detractors. When it comes down to it, it's a matter of understanding the size of "the army that's for you versus the army that's against you."

Tags: TomPeters FredReichheld ultimatequestion

(Author: unknown)

The average American consumer discusses brands 56 times a week. Are they discussing yours? Learn more

Customer Referrals and Your Sales and Marketing Department

admin — Tue, 21 Mar 2006 13:27:46 -0700

For the complex sale you need enthusiastic referrals to help you build your reputation, differentiate yourself, demonstrate your value proposition, shorten your sales cycle, and drive revenue.

So how do you ask for referrals? I wrote a post called, "Asking for referrals does more than Generate Leads," based on the Harvard Business Review article, “The One Number You Need to Grow” by Frederick F. Reichheld.

During two years of research, Reichheld discovered, that the answer to this basic question, 'Would you recommend our products/services to a business peer?', correlated directly to growth rates.

Jim Lenskold and Bill Lee just wrote a practical article on MarketingProfs which builds on Reichhelds's research and ideas. MarketingProfs: Turning Customers Into Your Sales and Marketing Department

(Author: BC)

Promoterz is the hands-free, word-of-mouth marketing service that takes care of the details so you can focus on business. Learn more

The Only Way to Grow a Business

Dave Free — Tue, 06 Dec 2005 13:08:16 -0700

According to Andy Taylor, CEO of Enterprise Rent-A-Car,

The only way to grow a business is to get customers to come back for more and tell their friends.

He seems to know what he is talking about. A recent Enterprise press release notes that they are the largest car rental company in North America and the fastest growing rental company in the airport segment. They also happen to be number 16 on Forbes list of largest privately held companies.

What is their secret? This is what Taylor says: “Our success in growing our airport business can be attributed directly to the highly personalized brand of customer service that we extend to each renter.” Just words? Apparently not. Over the last four months Enterprise was ranked #1 by Market Metrix for customer satisfaction in the car rental industry and JD Powers ranked them highest in customer satisfaction among airport car rentals.

I hope it is obvious that it is not just a coincidence that Enterprise keeps their customers happy and they have been growing like crazy. Happy customers come back and they tell their friends about their experience. So how happy are your customers and do you know how to find out?

That is the question that Fred Reichheld (author of Loyalty Rules) and his team at Bain Consulting set out to answer. Is there one “customer satisfaction” type question that explains or can predict growth for a company? You can listen to a summary of their findings here.

What they found is that there is one question that has a very high correlation to growth across most industries. The question is:

“How likely is it that you would recommend us to a friend?”

Makes sense, doesn’t it? If your customer is willing to put their reputation on the line for you they must have had a pretty good experience. So that should be the goal: give every customer an experience so great that they would be willing to recommend your business to their friends.

Now the question becomes, “how do you measure that?” There are probably lots of ways to do it, my bias is that Promoterz™ is probably the quickest and easiest way to implement a measuring process. The Promoterz™ feedback survey is built around the “recommend us to a friend” question. It also automatically calculates the net promoter score that Reichheld and his team developed to predict company growth.

However you decide to measure and manage customer loyalty, don’t think of it as a “one time” event or a seasonal activity. Andy Taylor, CEO of Enterprise Rent-A-Car can rank order his 5,000+ facilities based on customer scores every week. He also ties the compensation of his employees to those scores. It is an integral part of his organization’s operating metrics. If you are serious about growth, it should be a key part of yours as well.

The average American consumer discusses brands 56 times a week. Are they discussing yours? Learn more