A few weeks ago I wrote a short note about setting Net Promoter targets. I neglected to highlight something – possibly the most important element! – which is about focusing on improvement. Although target-setting is often thought of in terms of driving improvement, in my experience companies often set goals that focus on end scores. For example, a company might want to move from a 30% NPS to a 35% NPS. With a goal based on scores, employees will focus on scores (duh!), which means that they will do whatever they need to do to justify a score.
So what’s wrong with that? Here are 2 considerations:
- Volatility: NPS can move around quite a lot, with swings based on sample, seasonality, macro-economic factors, and more.
- Gaming: If you want a good score, who are you more apt to get feedback from… the customers that love you, or the customer that have “checked out” and no longer want to have a relationship with your company?
If the objective of setting Net Promoter targets (goals) is to improve then an improvement-centric goal is in order. Once you have a trustworthy (representative and validated) baseline, and once you know what it will take to improve those scores for a given segment, you can set a “% Improvement” target for that segment. A goal on “Improvement” means that people (employees) will focus on improvement, doing what needs to be done to get better results.
Next, what do you want to improve? Taking action based on customer feedback requires that the feedback be representative of the business. If your (segmented) response rate isn’t representative, then consider focusing on improving coverage (not NPS). In this way the focus is on getting feedback and taking action, and not on the voice of the loudest customers that may not be speaking for everyone.
How do you treat customers when they need to cancel your service?
I’m a big believer in learning from others, so thought I’d share this experience to those in the service business that might feel the same way.
I’m completely switching insurance companies after 10+ years as a customer with the P&C insurance company that supposedly is on my side. It’s a hassle, but so is working with these guys:
- I bought a new car (love that Mini!). Tried to update my auto policy on their self-service web site, but they wrote back that the car must be in my name to insure it… except it is in my name.
- Since I had to spend 15 minutes on this service issue I might as well check out the other guys, especially considering the mess-up these folks caused with a recent claim. Turned out that gecko saved me ~12%, so I bought their policy.
- I tried to cancel the other policy. After 17 minutes of various transfers and “retention agents” they emailed me a cancelation form. I immediately filled it out and returned it by email as they directed.
- 2 weeks later and my original auto policy still is in effect. They haven’t processed my refund. They charge a late fee if my payment to them is 2 weeks late.
- Tried to cancel again by email and also on their website. I received a confirmation of my request, and that someone will be back with me in 2 days. That was Tuesday morning, and now it’s Thursday afternoon.
Since I have to call them again I’m taking the opportunity to also switch and cancel my umbrella and homeowner’s policies. Looks like I can get better rates elsewhere and I’m pretty sure I can’t get treated any worse, given both this situation and their poor handling of a claim about a year ago.
If they had just made it easy for me to update the policy all would have been ok. If they had just let me cancel the Auto policy they wouldn’t have lost everything. Now I’m telling everyone to stay away if you want any sort of customer service.
How do you treat customers when they need to cancel?