ATLANTA, Nov. 4, 2021 /PRNewswire/ -- Being a strategic leader requires asking the right questions and understanding the best way to measure success. Leaders must be able to obtain insight into the state of the business and reinforce strategic focus. One of the most important questions a leader must be able to answer is, "What do my customers think of our business, and would they recommend our services?"
A customer's experience with a brand determines not just whether they would purchase an item from them again, but also whether they will become brand supporters or detractors. Word-of-mouth has long been seen as a vital marketing strategy, and former customers' opinions can also have a significant impact on sales. According to research conducted by Referral Candy, 88% of Americans trust word-of-mouth reviews and recommendations.
Deepak "Dee" Agarwal, c-suite business leader and long-time entrepreneur, recommends "getting a feel of how people talk about and advocate for any brand is vital in obtaining and retaining loyal clients."
"This data not only tells us which products and services are most important to customers," he continues, "but also where marketing and client acquisition initiatives should be made."
While social media listening and customer review monitoring can provide insightful information into what customers think of a brand, measuring sentiment via Net Promoter Scores is one of the most powerful tools available to organizations. Net Promoter Score or NPS is a management tool that gives data and visibility into the strength and depth of a brand's relationship with its customers, as well as their likelihood of suggesting a brand to their peers. NPS scores vary from 1 to 10, with scores of 9-10 indicating promoters/advocates and 1-6 indicating detractors. Scores of 7-8 are regarded as neutral.
Dee Agarwal notes, "Net Promoter Scores not only provide visibility into the health of client relationships but also vital insights into the company's growth prospects." According to studies, a 7-point rise in NPS corresponds to a 1% gain in revenue.
Earning a high score, on the other hand, is not necessarily a guarantee of success. In times of industry upheavals or retraction, even businesses with high NPS might face reductions. Having a solid client base becomes even more crucial in those times, which is why NPS should be utilized to inform customer acquisition initiatives and improve customer retention.
"The most important component in running a successful business is acquiring new customers. It's also usually the most expensive, and it's a never-ending process," said Dee Agarwal. "Brands shouldn't become complacent just because of a strong net promoter score. Maintaining strong brand sentiment is crucial for longevity. If companies want to establish and sustain a strong customer base of ambassadors, they must be committed to consistently delivering a 'wow' experience to every single client with every single interaction."
For more business insights from Dee Agarwal, check out Dee Agarwal on Test and Learn Strategy for Success.
SOURCE Deepak Agarwal