A retail company, MagnetHome enthusiastically embraced the Net Promoter Score and started measuring customer loyalty. They gathered all the responses diligently but stumbled into the “Everyone’s-the-Same” trap – treating all scores equally. High scores delighted them, so in the excitement they missed the silent grumbles of unhappy customers. This led to the team missing out on understanding the real issues!

Amidst the rush for scores, they started losing the customers, without any clue! 

And the amusing part, had they analyzed the NPS Score correctly and were not just ‘focusing on the number’ they’d have identified their detractors pretty early. Not just that, this would have helped them understand the issues well in time, leading to the prevention of churn! 

But, like many, they were ONLY focusing on – the one number that needs to grow!

That sounds rather unfortunate, right? 

Well, this is a classic example of an NPS analysis gone wrong. It’s not just MagnetHome, many organizations do the same for either of the following reasons – 

• They either focus only on the NPS score and not only on the feedback
• Or they don’t know how to properly analyze the NPS feedback (or leverage the power of a robust NPS software for quick analysis ).  

I’m sure you don’t want to make the same mistakes. But the challenge is, how to analyze the NPS feedback to leverage it to its best potential!

Well, after implementing the NPS program in over 40 organizations, I’ve created a list of 6 rookie blunders that you must avoid to keep your NPS Analysis fool-proof!

Now, let’s delve into the common mistakes to avoid when analyzing NPS feedback.

6 Common Rookie Mistakes in Net Promoter Score Analysis

1. Focusing Just on the Score, Neglecting Feedback:

Yes, the businesses that prioritize customer feedback have 1.6 times higher customer satisfaction rates than their peers, but that’s only when they actually listen to the Voice of the Customer for the sake of resolving the issue and offering better customer experience rather than just for the show.

The problem is: Many companies make the mistake of solely focusing on measuring and calculating NPS, and neglect the valuable insights hidden in the open-ended feedback. This tunnel vision leads to a fixation on scores rather than understanding the underlying issues customers face.

Impact: By focusing just on an NPS scale question and overlooking open-ended feedback, you miss the actual struggles and pain points that your customers are sharing. Now when you do this, you won’t have the insightful data that could have helped you take appropriate actions and resolve customer issues in time. 

What does this lead to?

Your customers might share their feedback with you once or twice, but when they feel like their voices are not being heard, they’ll stop responding – leading to low NPS response rates and a lower score.

Solution: Open-ended question question gives you a gold mine of feedback. Every single thing that people like, or dislike is mentioned here. All you need to do is dig deeper with AI-enabled tools like Text Analytics and use this feedback to figure out what needs fixing and then actually do something about it. 

→ And here’s the thing – it’s not just about fixing problems behind the scenes. It’s about telling customers, “Hey, we heard you, and here’s what we’re doing about it.” That kind of transparency builds trust and shows customers that their opinions matter.

2. Ignoring Segmentation & Context:

Don’t ignore segmentation in NPS analysis because it helps you understand what different groups of customers are saying. If you treat all customers the same, you might miss important details that could improve their experience. By looking at different segments, like age groups or types of customers, you can focus on what matters most to each group. This way, you won’t waste time and resources fixing things that aren’t really a problem for some customers, and you can make sure everyone gets the best experience possible.

But the problem is: Treating all customers the same is like trying to fit everyone into the same-sized shoe – it just doesn’t work! Each customer group has unique needs and preferences, and ignoring this diversity can mean overlooking critical issues that impact specific segments.

Impact: It’s not just a minor hiccup; it’s like fixing a leaky roof without knowing which room is getting wet. Ignoring segmentation can waste resources on fixes that don’t resonate with anyone. Moreover, it blinds businesses to the areas where real improvements are desperately needed.

Solution: Companies should break down their NPS data to see what different groups of customers are saying. This way, they can focus on fixing things that matter most to each group.

Did you know Spotify uses segmentation to tailor its music recommendations? By analyzing users’ listening habits, playlists, and preferences, Spotify provides personalized suggestions, creating a more individualized and engaging experience for each user. 

3. Failing to Benchmark & Compare Against Competitors:

According to a report by Forbes, 81% of businesses with a formalized benchmarking process in place believe that it significantly improves their competitiveness in the market.

NPS benchmarking against industry standards is a compass guiding businesses through the vast sea of customer satisfaction. It provides a crucial frame of reference, enabling companies to navigate their performance with peers. This comparative analysis is not just about numbers; it’s a strategic tool that unlocks several key benefits. 

But the problem is: Some companies only look at their own NPS score without comparing it to others in the same industry. This can make it hard to tell if they’re doing well or not. Neglecting to benchmark against industry standards can plunge businesses into a sea of ambiguity. 

Impact: It can give a false sense of security or cause missed opportunities to learn from others. Without this external perspective, a high NPS might breed complacency, as the true competitiveness of the score remains obscured. This isolated interpretation can lead to missed opportunities for learning from industry leaders and adapting to evolving customer expectations.

Solution: Well, the remedy lies in actively comparing the NPS score to others in the same industry. This strategic move provides a reality check, offering a clear understanding of the company’s relative performance. 

Basically, it helps them see where they’re doing well and where they could improve. It becomes a powerful tool for recognizing strengths to build upon and weaknesses to address, ensuring that improvements are not based on internal assumptions but are informed by external standards and best practices.

→ How to benchmark your NPS Score?

Delta Air Lines, a major airline, employs benchmarking to assess its on-time performance, customer service, and overall operational efficiency against industry standards. This approach enables Delta to identify opportunities for improvement and maintain a competitive position.

Create NPS surveys with SurveySensum and benchmark them against your competitors!

4. Treating NPS as a One-Time Event:

Research by the Temkin Group indicates that companies with higher NPS scores, achieved through regular measurement, tend to experience higher revenue growth rates. I’m sure you would want the same for your company!

Now, as you see, you need to create NPS surveys regularly. How else would you know if the changes you made actually had an impact or not, right?

But the problem is: Some companies make the mistake of treating Net Promoter Score as a one-time event, a snapshot frozen in time. They gauge customer sentiment, make changes, and move on without realizing that customer perceptions change over time. This oversight undermines the dynamic nature of customer satisfaction.

Impact: Neglecting continuous NPS implementation is like planting a garden and never watering it. The initial bloom might be impressive, but without ongoing care, it withers. Failing to track progress and follow up on NPS insights means missing out on understanding the long-term impact of changes. It renders the NPS measurement a mere formality, devoid of its true potential for driving sustained improvement.

And when you’ve already put in the effort, why go home without a reward?

Solution: Therefore, you need to embrace NPS as an ongoing journey, not a one-stop destination. Companies need to implement NPS consistently, gathering feedback at regular intervals to capture the evolving customer landscape. This approach allows them to track the impact of implemented changes, identify emerging trends, and continuously refine their strategies based on real-time customer insights which ultimately helps in improving customer retention rates.

5. Relying Too Heavily on NPS Alone:

Problem: Relying solely on NPS for customer feedback is like seeing only part of the picture. While it provides an overall score for customer loyalty, it overlooks crucial details. Many companies make this mistake, using NPS as their main measure of satisfaction without considering other vital aspects of the customer experience.

Impact: This narrow focus means missing important touchpoints in the customer journey, such as onboarding and delivery experiences. Without additional metrics like CSAT and CES, businesses risk overlooking specific pain points or areas for improvement. This limits their ability to enhance the overall customer experience effectively.

Solution: To address this, businesses should take a more holistic approach to NPS feedback analysis. Alongside NPS, they should use CSAT and CES to gauge transactional experiences at different touchpoints. By doing so, they can identify specific issues systematically and make targeted improvements to enhance overall satisfaction and loyalty.

6. Forgetting to Close the Loop:

One of the crucial key things that often gets overlooked in the NPS analysis is – closing the feedback loop. It’s not just about grabbing scores; it’s about reaching out to the customers who took the time to respond. This isn’t just a follow-up; it’s a game-changer. It turns NPS from a simple measurement tool into a trust-building, loyalty-fostering powerhouse.

Problem: Imagine you ask for advice, and then it feels like no one’s paying attention. That’s what happens when companies don’t close the loop with NPS feedback. Neglecting to close the loop sends a signal that their opinions are undervalued. This can undermine the credibility of the entire NPS program, as customers may perceive it as a token gesture rather than a genuine commitment to improvement.

Impact: Customers appreciate being heard and seeing tangible results from their feedback. When companies fail to act on NPS insights, trust erodes. Customers may question the sincerity of the NPS initiative and, by extension, the company’s dedication to their satisfaction. This breakdown in trust can result in diminished customer loyalty, as consumers may feel their feedback is falling on deaf ears.

Solution: Companies should thank customers for their feedback, explain what they’re doing with it, and keep them updated on any changes made.

Avoid these mistakes and enjoy a smooth NPS analysis ride with SurveySensum!

Now that you know what mistakes to not make while implementing different types of NPS in your company, you ought to know the correct ways to analyze all the NPS feedback that you will receive! Here’s how you can do it.

How to Analyze the NPS Feedback?

To make sure your resources do not go to waste, here is a step-by-step guide to help you enhance your Net Promoter Score analysis in just the right way:

STEP 1: Categorize Responses

Organize open-ended responses into predefined topics (e.g., Functionality, Usability) and tag sentiments (Positive, Negative, Neutral). This categorization quantifies results and provides context to NPS scores.

STEP 2: Analyze Based on Demographics

Utilize demographic data to segment customers, understanding which groups have more Promoters or Detractors. Identify preferences appealing to different demographics for more customized experiences. With this you can create brand advocates and focus specifically on negative feedback.

STEP 3: Identify Root Causes

Deep dive into the complaints and validate them with customers. Engage frontline staff to integrate their insights, and importantly, communicate directly with customers. Follow up with them, express empathy, offer apologies, and comprehend the issues at hand as well as their expectations for resolution.

STEP 4: Detect Trends Over Time

Track survey results periodically, searching for trends. Regularly sending surveys helps identify changes in customer behavior or opinions. Analyze feedback over time to pinpoint preferences, dislikes, and potential issues.

STEP 5: Share Results with Teams

Distribute actionable insights across relevant teams. If there are complaints about a mobile app, share NPS results with the product team. After pinpointing the main concerns and verifying them with your customers, the subsequent stage involves assigning these issues to the relevant departments and utilizing the insights to formulate an effective action plan.

STEP 6: Measure Your Impact

Following the implementation of changes based on customer feedback, a notable improvement in customer satisfaction and overall brand experience will be evident through the results of NPS surveys. This can be validated by observing key indicators such as an increase in the NPS number, a reduction in the occurrence of negative tags, and an enhancement in customer sentiment associated with those tags.

So, the next time you undertake the analysis of your NPS, make sure to adhere to these six crucial yet remarkably straightforward steps. When completed, you can expect a significant enhancement in the success rate of your NPS program!

Conclusion

In the realm of Net Promoter Score analysis, the key lies not just in measuring but in understanding, adapting, and evolving. As businesses navigate the intricate landscape of customer satisfaction, these lessons serve as a compass, guiding them toward customer-centric excellence and ensuring that the journey is as rewarding as the destination.

So, with this blog, you can get to know the things that you should not do along with a step-by-step guide on how to analyze NPS the right way. Implementing these steps the correct way will help you get the maximum value out of your NPS feedback.

To extract optimal insights from your NPS feedback, using an effective NPS tool such as SurveySensum is crucial. This platform helps in crafting tailored NPS surveys, dissecting verbatim responses, swiftly closing the feedback loop, and ultimately fostering enhanced connections with your customer base.