In any business loyal clients are our favourite clients. They share many characteristics: they buy more, they are easier to work with, they pay their bills on time, and they tend to refer new clients. If we could have more loyal clients in stands to reason that we would have a growing and more profitable business. Not only do loyal clients spend more, but they refer more new clients which reduces the cost to get new clients. The problem is how do we measure the loyalty of our clients? In the past our veterinary practice used to send surveys to our clients that were focused on customer satisfaction, the quality of service they received, and the cleanliness of our facility. These surveys gave us results that were not quantifiable. The answers were either descriptive, or vague. It was nice to know that our facility was clean and the receptionist greeted our clients warmly, but there was nothing measurable that we can use to improve ourselves, or gave us a score of how loyal our clients were. Also, the surveys had too many questions and our response rate was less than 10%.
I began researching other options and I came across a system called the Net Promoter Score (NPS). It was a system used to measure client loyalty by the majority of Fortune 500 companies, including Costco, Apple, Amazon, and Enterprise. The latter valued the score so much that they used it as the basis for bonuses and promotions at each rental car location.
The basic premise of the NPS is that there is really only one question one needs to ask to determine client loyalty – How likely is it that you would recommend our company/product/service to a friend or colleague? We all know that a recommendation to a friend or a colleague is the highest form of support for a company because our reputation is on the line. We aren’t going to recommend a terrible company to someone we care about. This is why on line reviews are so popular. When I plan a vacation I scour online travel sites to evaluate the best restaurants or attractions at my destination. Can you imagine buying something on Amazon without reading a review of the product first?
The Net Promoter Score is measured from 0 to 10 with 0 suggesting “not very likely” and 10 indicating that someone is “very likely” to recommend the company. On this scale there are three categories of results. Promoters score a 9 or 10. They exhibit all of the positive behaviours of a very loyal client. Passives give a score of 7 or 8. They are on the fence. They like the company a lot bit, but are open for other opportunities. Detractors score from 0 to 6 and depending on how low a score they give are actively looking to use another company. These are the people that will bad mouth your business, argue over prices, and do the minimal required for their pets. The Net Promoter Score is determined by subtracting the percentage of responses that are Detractors from the those that are Promoters. This means scores can range from -100 to 100.
Our interest was piqued, so we began to use the survey. It was sent anonymously using an online email service like Survey Monkey, or Mail Chimp. We also added a couple of open ended questions asking why someone scored us 9 or above, and why someone scored us 6 or below. For those offering a low score we asked if they would supply their name and contact information so we could discuss where we failed. Right away we were happy with the survey because we had a 33% response rate, far higher than the 10% of previous surveys and we had a NPS of 84%. We first used the survey during the Great Recession and the high scores we received was very comforting during that scary time. Our very positive results gave us confidence that our clients were very loyal and wouldn’t flee us for cheaper alternatives at the first opportunity. We also found value in the comments because of the specific reasons people gave for their score.
There are challenges using The Net Promoter in that we don’t want to send the survey to every person that uses our practice since some come very often. If we sent the survey after every visit we would annoy them, so we filter our client visits and only send the survey every 6 months to frequent clients. Getting client visit information isn’t easy with all practice management software programs so you might have to find someone who is very comfortable using spreadsheets to modify this information to send the survey in an appropriate manner.
Using the Net Promoter Score has given us a consistent quantifiable tool to help us appreciate the level of client loyalty we have. Over the years the numbers have gone down at times, which wakes us from our complacency to look at why our score was declining. We were able to look at the comments and make adjustments.
Loyal clients help keep our businesses growing and profitable. Having a simple tool that uses one question is invaluable to help us understand our level of client loyalty can make a huge difference on the financial health of our practices.
What have you used to measure client loyalty? Please leave a comment of your experiences. Thank you
This article was previously published in Canadian Vet Magazine. http://www.k2publishing.ca