5% increase in retention can lead to 25%-95% increase in profit
(Source: Bain & Company)
Harvard Business Review says, “acquiring a new customer is anywhere from five to 25 times more expensive than retaining an existing one.”
Retain customers more effectively by using a Net Promoter Score (NPS) survey method. This blog post will explain what NPS is, how to conduct the survey, and how it can help you retain more business and increase profits.
NPS and keeping customers happy
But, what about the time it takes to keep customers happy? It can be mentally taxing to nurture client relations even if it is more affordable. This is where a NPS survey can help. It can take the guesswork out of which customers need attention and which don’t.
Net Promoter Score Survey
You’ve seen this before. Perhaps you didn’t know it was the NPS survey.
Despite the simplicity, this single question will help you understand client satisfaction. Responses are sorted into three categories:
- Clients who answer with 9 or 10 are Promoters
- Clients who answer with 7 or 8 are Passive
- Clients who answer with 0 to 6 are Detractors
Your agency’s NPS value is calculated by measuring the difference between the percentage of Promoters and the percentage of Detractors. Passives are set aside because they could go either way. Borrowing the go-to example for NPS, imagine surveying 100 clients. If 50% are Promoters (respond with 9 or 10) and 30% are Detractors (respond with 0 to 6), you agency’s NPS value would be 20.
The higher your NPS, the more likely your clients are promoting your agency through word of mouth and positive reviews.
Further readingThe Net Promoter Score is very popular, and much smarter people have written deeper explanations. We recommend this comprehensive guide from HubSpot. |
How to conduct an NPS survey (and track responses)
Warning: this is about to dive straight into the weeds. If you are confident in your own ability to conduct a survey, jump to the next section to explore what to do with the survey results.
Here are the tools you will need to conduct an ideal NPS survey:
- An NPS survey
- A survey service that allows exporting responses (HawkSoft uses SurveyMonkey, but you can get a lot out of the free Google Forms too)
- A list of your existing clients' email addresses (easily exported from Advanced Reports)
#2 is ideal, but you can make this work without the ability to export results. It will only add a little manual work if you can’t.
Building your NPS survey
Your survey needs the central question (see above), “How likely are you to recommend { agency name } to friends or colleagues?” with a 0 to 10 scale as the answer. Technically, that is also the only question you need and it is best to keep surveys short. This does leave valuable information on the table, however, and we recommend adding a few more questions to maximize the usefulness of your survey. First and foremost, you need to give an open ended area for client feedback on what you can do to improve their score. This gives them a place to qualify their answer.
For any additional survey question, always ask, “What will I do with this answer?” HawkSoft, in our own NPS survey, added a question about agency role. As an insurance agent you may consider adding questions like:
- How did you originally hear about our agency? (Learn if a specific source produces a higher/lower NPS?)
- Have you heard from our agency in the last 6 months before this survey? (Learn if recent engagement with clients increases/decreases their NPS?)
Once you have the survey written, it is time to put it online to share with clients.
Finding a survey service
There are several good online survey services. We use SurveyMonkey, but if you’re sending to more than 100 clients and/or wish to export the results, you will need a paid subscription. HawkSoft surveys our customers frequently and believes the paid version is worth the small investment. That is a decision you would need to make for your agency. Here is SurveyMonkey’s own guide to NPS surveys.
If you want to dip your toes into an NPS survey without spending money, Google Forms is a good alternative. All you need is a Google account (free). Google will allow you to send the survey to unlimited email addresses and you can export results. Here is a walkthrough on how to use Google Forms.
A list of existing customers
Once you have your survey ready and have it loaded into a survey service, you need a list to send it to. The simplest route would be to use HawkSoft to send a Batch Email containing a link to the survey. If you use this approach, add a question to your survey for the responder to provide their email (and make it required). That way you can track the NPS score to the client. Use Agency Intelligence to quickly see all active customers, or run an Advance Report to hone in on a specific audience (such as Auto policyholders). Use Email Templates and Batch Email to send the email.
A more insightful and client-friendly approach may be to use the survey service to send the survey to your list. This automatically adds tracking and links a response to an individual without the need to ask for identifying information. Use Agency Intelligence or Advanced Reports to produce your desired list, and then export the report as a CSV file to upload to your survey service.
Take action based on NPS survey results
Segment your customers based on where they fall on the NPS scale. The action you take will be different per segment.
The first decision you need to make is, which group needs more of your attention? If you have a large pool of Passives, and a small one of Detractors, swinging the Passives to Promoter may pay more dividends than making the effort to take a NPS 3 Detractor all the way up to a 9 or 10 Promoter. You will also have insight into who is a Detractor. If your biggest client isn’t happy or recommending you, that needs addressing.
| A word of advice: To quote Uncle Ben, “with great power comes great responsibility.” You will have a power to know which of your customers gave you a particular score. Do not hold their candid feedback against them. The NPS survey is an opportunity to learn what you can do better, not to find a list of customers that don’t like you enough. Customers are ultimately helping you by providing feedback and to bare a grudge for a particular response would hurt your agency. |
Promoters are those who respond with a 9 or 10. They likely don’t need more attention (but definitely not less). Consider throwing an event and inviting your Promoters. Display gratitude not for the score they gave you but for the actions that are generally related to being a Promoter. Celebrate them as good friends of your agency.
Passives are those who respond with a 7 or 8. This group doesn’t see your service as bad, but they’re not really sold on how valuable their relationship with you is. Invite Passives in for free insurance consulting or start an email campaign highlighting the services you offer existing customers. Demonstrate why your agency is worth speaking of highly to friends and colleagues.
Detractors are those who respond with 6 or lower. They aren’t recommending your services, may be actively working against you (through bad reviews or word of mouth), and are at risk of leaving. Immediately start a conversation with them. Engage them to learn why they feel the way they do. Come up with a plan to address these concerns. Your swift response and conversations with this segment will go a long way in converting them from Detractors to Passives or Promoters.
What action you take will ultimately depend on your agency and your market. The best universal advice we can offer is to simply call any customer with a score you want to improve. If you value keeping their business (which, again, is five to 25 times less expensive than signing a new customer) then reach out and find out what you can be doing to better serve them. A direct conversation removes doubt and demonstrates to your client that you are invested in the relationship.
The Net Promoter Score survey gives you business intelligence on how to improve retention with your clients. It can be a critical tool to improving retention and word-of-mouth referrals.
Image Sources: ShutterStock; SurveyMonkey
