If you use a Net Promoter Score (NPS) to judge the perceived quality of your restaurants over time, you are in good company. Over two-thirds of Fortune 1000 companies use this important score to keep track of customer loyalty and engagement. In fact, it’s become “all the rage” among Fortune 500 companies.
For those of you that are unfamiliar with this important tool that provides customer feedback and measures, among other things, how likely these customers are to recommend your establishment, let’s go over the basics.
What is Net Promoter Score?
NPS was first developed by Fred Reichheld, a partner at Bain & Company, in 2003. Since that time, as companies expanded upon the initial concept, NPS developed into a scientific method and a standard key performance indicator (KPI), a benchmark in the customer experience.
In its simplest form, it boils down to a survey with one question: On a scale of 0 to 10, how likely are you to recommend us to a friend? Customers are then placed in one of three categories depending upon their answer.
- Promoters are customers that reply with a 9 or 10 and are highly likely to recommend you.
- Passives are customers that reply with a 7 or 8 and are indifferent, meaning they could swing in either direction.
- Detractors are customers that reply with a 0 through 6 and are likely to seek service elsewhere or even share their bad experience.
How do you Calculate Net Promoter Score?
Your score is determined by subtracting the percentage of Detractors from the percentage of Promoters.
100 * (% of Promoters – % of Detractors) = NPS
As an example: You’ve surveyed 100 customers and 60% came back as Promoters while 15% came back as Detractors. Your NPS is determined as follows:
100 * (60% – 15%) = 45
The average score for those in the fast-food category such as Chick-fil-A, McDonald’s, and Starbucks is 30. A high score for these concepts is 53 and above. Restaurants with scores higher than 60 are considered excellent. This number then tells you that you’ve got a little bit of work to do, but you’re on the right track.
What are the Benefits of NPS?
NPS is a management tool that can be used to determine how your customers perceive your establishment and how likely they are to refer you to others. A sudden drop may suggest that food quality and/or customer service has suffered. An increase may show that training programs and/or an improved menu are having an impact.
In the context of reopening from COVID-19, it’s imperative to know how your returning customers are reacting to the safety protocols and overall experience.
Here’s an example of why this benchmark is so important to include when monitoring the state of your restaurants:
One of EMERGING’s clients performed a survey in early February, just prior to the rise of the pandemic. They received a score of 48. They then implemented an extensive customer service training program, ran another survey in March, and found their score had jumped to 66.
What are the Best Practices When Implementing NPS?
- Include a question in your survey that tells you why your customer chose the score that they did. This will give you vital information regarding what is working well, and what areas need improvement. When Saddleback BBQ asked the question, “Please explain why you provided the score that you did above,” they found that their customers wanted more specials, lighter options, another location, and delivery.
- Follow up with NPS Detractors within 24 hours. This is an excellent opportunity to find out how you can change Detractors into Promoters before they take to their social media accounts.
- Ask NPS Promoters if they would be kind enough to review your business online. Knowing which customers fall into the happy and satisfied category allows you to request reviews from guests that will be most likely to leave a positive comment.
- Turn Passives into Promoters by addressing their pain points and resolving them.
- Make it easy to find the survey and submit it. Instead of sending out mass emails that may or may not be opened, place the survey at the bottom of the receipt. Of course, if you’ve gone paperless, this is not an option. In that case, be sure that your email list contains a large percentage of your customers. This can be achieved by capturing email on Wi-Fi, through your reservation system, social media, and competitions. Tomatina, a California Italian chain, gets feedback from about 75 guests every week by using their rewards program and an app with a link for feedback.
- Make this benchmark an important part of your monthly comparative data. Measuring NPS over time will allow you to see whether your customer’s experience is diminishing or improving. You’ll also be able to discern if the steps you’ve taken to improve your establishment are working.
Multiple Locations – Comparing Apples to Apples
Implementing NPS surveys at multiple locations gives you vital information when comparing units. When Bain & Company spoke with two leading restaurant executives, the biggest takeaway was that “tracking NPS provides invaluable data for restaurant executives at multilocation brands—provided you engage customers at a relevant time and in a personalized fashion. Sales increases by an average of 7% to 24%.” Want more help with NPS? Contact Us!