The highly popular Net Promoter Scoring (NPS) customer satisfaction measure (originally created by Bain & Co.) has gained broad adoption in the last five years. Customers’ likelihood to recommend you to others is a great measure of their satisfaction and loyalty. Unfortunately, Net Promoter Scoring limits visibility and can lead your customer satisfaction initiatives astray.
There are two key issues with traditional NPS:
1. It asks customers to predict their own behavior. The standard NPS question is, “Would you recommend us?” Many companies have found that customers say they WOULD recommend, but over half of those that say they would, don’t.
2. A Net Promoter Score is not actionable alone. Simply knowing how much customers expect to recommend you doesn’t provide clues as to how to improve their loyalty and word of mouth.
Despite these drawbacks, the core concept of NPS is an important one: Happy customers create new business. The key to leveraging this concept is to tweak NPS to ask more actionable questions, and then incorporate it into a broader customer intelligence effort.
Read more in my recent Beyond NPS brief...
Idea Design’s blog about asking is right on – and applies to businesses as much as to charities. At the end are three points that may as well have been written for businesses – here they are, with business terms inserted:
“1. Be where your [customers and prospects] are. Hang out with them. Learn their language and be relevant to them.
2. If you want to [close deals] sooner or later you are going to have to ask for [the sale].
3. And when you do ask, ask in a way that is appropriate to your [customer]. ”
In a business, these apply to the sales reps, and to the rest of your organization. Get your messages into the places customers look to for information (note – first place they look is not your website). Your marketing, services, and product development / design staff should be attending the same events, reading the same publications, and participating in the same discussions on and off-line that your target audiences do.
Most sales people don’t have much trouble asking for a sale – but they often fail to do their homework and communicate why their offer should matter to the customer in the customer’s terms. That makes the ask inappropriate. To increase the frequency of yeses, increaes the relevance of your offers. To make that relevance natural, as Idea Design suggests, hang out with the customers.
I hate hate hate pricing my consulting work. There is always a tension between the value it brings to the client (which gurus like Alan Weiss will tell you is the only thing that matters), the reality of the client’s budget, the amount of effort and expertise required, internal company politics, etc.
So even before reading the article about a coffee shop that does not post prices, I had tried handing the pricing reigns to clients by asking some version of, “What do you think this work should cost, given the value you expect it will bring?”
Results? Some clients did not want to name a number, and I ended up pricing the project as usual. Some DID name a price: always higher than I would have quoted. The difference: Clients who were comfortable naming a price already knew me and had worked with my firm before. It seems letting your customer set the price may be a great model when:
1. The customer is well-informed about the product and its value, or can become informed easily and quickly as in the case of the coffee shop. (This is the basis for free trials: Assume the customer will assign little or no value when first encountering a product. Depend on familiarity leading customers to agree with you on price.)
2. The customer has had some exposure to competing products and prices, and has a basis for comparing the relative worth of your product vs. the others.
3. The customer has a relationship with you, even if only a momentary one (note in the video that the cafe owner describes people “looking him in the eye and stating what they think is fair”)
Share your thoughts on if and when letting customers set the price is the right thing to do.
Given that segmentation is the cornerstone of marketing, I am often surprised at how little of it B-to-B companies actually do. Company size and geography are often the only criteria for segmentation, with industry being a distant third. There are other ways to slice and dice. A few ideas:
1. Look at customer characteristics such as tolerance for risk, speed of technology adoption, core business driver (are they technology-driven, customer-driven, supply-chain driven, etc.) – some may be much more likely to buy from you than others.
2. Separate customers with different levels of familiarity and experience with your company and products – your objectives and sales approach will be very different.
3. Split companies up by specific situations, business processes, or use-cases that are common to an industry or a business models. The solutions and services you offer them will vary drastically.
4. Define audiences based on their roles and responsibilities within an organization or within the decision-making process. Also consider segmenting by organization structure and culture – highly hierarchical, process-focused companies need a different sale then flat and agile organizations.
5. This seems painfully obvious, but then again, its rarely done: Segment based on actual customer objectives. This one is difficult and takes account-specific research to determine who fits where. So we tend to just assume that all companies in an industry, experiencing the same pressures (you know, the slide that says “Increased competition, Decreasing customer loyalty / ease of switching, regulation and/or deregulation, growing complexity of IT environment..”) must have the same objectives. But in fact, some are looking to get bought, some want to grow internationally, some want to raise revenue from existing customers, while other are focused on boosting profitability.
Most companies also under-utilize the insights that segmentation provies. Next time we’ll explore the uses of segment characteristics in various parts of your organization.
Comment and share some innovative segmentation criteria you’ve seen used by BtoB companies.
More than once over the last few months, I’ve had the unsettling experience of meeting with a potential client, planning to discuss how I can help their company, only to to discover they are no longer with their company. As sign of the times, to be sure. Moving contacts create challenges at existing accounts, but opportunities elsewhere. So what does one do when your key contact at an account suddenly isn’t at the account?
A few thoughts:
Be proactive – diversify: Cultivate multiple relationships within each account. Follow up with people you meet in meetings or who collaborate with you during and after the sale. Ask your sponsor or champion to make a few introductions, particularly in different departments or organizations than their own.
Follow: Social networking tools make it easy to keep in touch as people move about. Take note of status changes that may indicate a new position, employment status, or company.
Help: This is a time when active networking and introductions are more valuable than ever – offer them. Whether its a potential employer, employee, or partner, introductions are a great way to create value and build relationships.
Follow Up: Make sure customers who have bought from you before know how you can help them deliver results as they take on new roles in new organizations.
Systematize: Your top reps already do all of the above. Consider spiffs or other programs to make sure the new contacts make it from personal spreadsheets into your CRM systems. Help all reps get proactive by measuring the breadth of contacts at accounts on an on-going basis. Provide simple tools like email templates to make re-connecting easier.
Comment and share your own ideas on maintaining sales contacts in these tumultuous times.
After 2 days at the Sales 2.0 conference, I fear we may be on the same path CRM took in its early days. Though some of the new tools are great, and MUCH easier to adopt, there is too much talk of technology, not enough about behavior and cultural changes. All things 2.0 are really about interaction and collaboration with customers. And that requires a change in mindset.
Basic example of 2.0 principles in action, that actually requires less technology. (A version of this focused on customer references was used very successfully by Beverly Chase and the BEA marketing team)
Instead of arming your reps with the new and improved power point presentation, design a white board talk. Script it with questions and discussion points instead of spiel. The result is a conversation where customers contribute ideas, and the content evolves based on the here-and-now in the room, and not what marketing thought up a month ago back at corporate.
More ideas on cultivating customer contribution and creating opportunities for interaction by turning traditional marketing into Marketing 2.0
6. In-person events – These are expensive to put on, so why spend the entire time lecturing on information that’s already in your collateral? Third party presenters can be more interesting, but any lecture can get dreary fast. Give attendees lots of time to interact with you and with each other, while you listens and takes notes. Consider a workshop rather than presentation format so that the entire event is interactive.
7. Trade Shows – This seems like a highly interactive event, but most booth staffers are so focused on doing the demos and spewing the spiel, that the opportunity to listen is lost. (I adore alliteration.) To change the mindset, make it clear you’re at the show to interact with and listen to customers, not just to be seen and heard. Set objectives of specific information you want to gather from booth visitors or people attending your sessions. Ask a few questions or give a short (5 questions max) survey before handing out the tchachkis, or organize mixers and events that have information gathering as an explicit objective.
If a widely open a conversation seems too much of leap, try these by first letting a small group of customers you know well contribute and participate, then open further when you’re comfortable managing a broader conversation.
Have you tried these or other ways to engage customers in conversations? Share them in your comment!
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Turning Marketing into Conversations – Part 2
Turning Marketing into Conversations – Part 1
Social networking channels are not the only way to make your marketing efforts more interactive. While you experiment with social media, you can make traditional marketing methods conversational too.
Getting customers to contribute to the substance in your marketing content, events, products will raise the value and trust customers place in them. Dan Ariely, author of Predictably Irrational, demonstrates that “labor enhances affection for its results.”
This week I’ll be posting a series of ideas on adding interaction and soliciting active customer engagement and contribution through traditional marketing tools. Here are a few to start off.
- Value proposition and messaging – Starting with the obvious here: when crafting your claims of benefits, value, and ROI, ask your customers what benefits they’ve actually received. Use these results to create your messages about benefits and value. Then go back and ask customers if they “buy” the story you tell about how your product leads to business results. You’ll have messages that really resonate, and your will have created references that back up your story because they ARE the story.
- Collateral and White papers – Create a Wiki instead of static product data sheets, brochures, and white papers. Provide a framework and some base content, then give customers the ability to contribute. You can moderate to ensure accuracy, of course. With customers contributing, you’ll have more complete, relevant, and trustworthy information.
Have you tried these or other ways to engage customers in conversations? Share them in your comment!
Read More
Turn Marketing into Conversations – Part 2
Turn Marketing into Conversations – Part 3
Everywhere you look, its web 2.0, and even 3.0 with the central theme being interactive communication, user engagement, and the democratization of content. But are we really interacting, or just blasting messages into the ether? Christopher Carfi’s recent post highlights a gem of a quote - Leave it to the Amish to distill the essence of the shortcomings of much modern communication.
With so many channels for communication, it seems customers should be more engaged than ever. Are yours? If not, or if not enough, take a look at how much time you (and your marketing organization as a whole) spend on outbound marketing and messages, and how much on creating and participating in conversations with customers.
Your customers are participating in social networking and contributing to social media. MyBlogLog, a site that attempts to consolidate data across multiple communities, lists 55 social media services. LinkedIn, Twitter, Technorati, Digg, Plaxo, a sea of blogging platforms… And new ones pop up almost daily.
The good news is that there really isn’t hope or reason to maintain ubiquitous presence. Instead, find out which ones your customers frequent, and design a process for participating in those.
Even better news: You don’t need to jump on every social media and networking tool in order to have conversations. You can make traditional marketing methods more interactive too. Next time: Some ideas of how to do that.
As a follow-up to the previous post, here are some practical differences to keep in mind when planning for solutions marketing.
Solution marketing differs from traditional product marketing. This is a partial list, of course, but 7 is supposed to be a lucky number, right?
- Solutions marketers understand what motives customers to allocate budget within the broader context for a purchase
- Solutions marketing content is focused on the buyer and their objectives, not the product or its features
- Solutions-oriented value propositions focus in on specific use-cases or situations in which the customer is involved.
- The solutions marketing process and programs provide information or resources that are valuable to the customer
- Thought leadership and value creation are critical components of solutions marketing
- Solutions marketing activity often involves collaboration with other companies (see broader context in #1)
- To ensure that all of the above are truly relevant, current, and valuable to your audience, Solutions Marketing must engage the customer in conversation and dialogue at every available opportunity.
Speaking of dialogues, please add to the list with your comments!
