How Warby Parker Created an Army of Loyal Fans by Measuring their Net Promoter Score
Looking at ecommerce top-performers, you’ll notice that their customers are more than just customers. They’re fans. They love their brands and promote them without even considering it as promotion.
Think Bevel. Think Huckberry. Think Warby Parker. Fans tweet, post and share images of the products because they truly love them, not because the brand is commissioning them to take this action. That’s called pure customer loyalty, and it’s one of the most difficult pieces of your business strategy to develop and optimize.Loyal customers are worth up to 10x as much as their first purchase @helpscout
We’ve written a post about improving customer retention and turning your ecommerce customers into repeat buyers, but this article is going to focus on a metric you’re probably not tracking, or maybe not even aware of: your Net Promoter Score (NPS). Your Net Promoter Score can help you determine how likely your customers are to become loyal customers and mini-referral engines.
What is a Net Promoter Score and how is it measured?
The NPS is a way of labeling customers on a scale of 1 to 10, based on a single survey question:
“How likely are you to recommend this company to a friend?”
According to the consulting firm Bain & Company, who built the NPS, each company’s customer base can be divided into 3 categories:
- “Promoters” [answered 10 or 9] are loyal enthusiasts who will continue buying from a company, and urge their friends to do the same.
- “Passives” [8 or 7] are satisfied but unenthusiastic customers who can be easily wooed by the competition.
- “Detractors” [6 to 0] are unhappy customers trapped in a bad relationship.
The NPS is calculated with the following formula:
Percent of Promoters – Percent of Detractors = Net Promoter Score
It can have results ranging from 100 (maximum attainable score) to -100 (lowest possible score).
What does this mean for your ecommerce business? Is calculating your NPS even worth the effort?
One important product of calculating your NPS is the ability to compare it with an industry benchmark (your competition). This can help you understand your position in the market according to your customers.
David Gilboa, the founder of ecommerce company Warby Parker says that NPS is a measurement of customer satisfaction, and is “the best indicator for the health of their brand”. (source)
Warby Parker has been very focused on delivering great customer satisfaction since their launch, and they’ve maintained a NPS in the high 80s and low 90s since their early days. Their strategy of measuring and delivering great customer satisfaction has helped them to not only become a well-known brand, but to sell more than a half a million frames in just 4 years..@WarbyParker’s best indicator of brand health is their NPS. Why you should calculate yours
Imagine how much power knowing this information could give your overall business strategy! Let’s dig into what exactly your NPS is, how to calculate it, and why it is the most important metric you’re not using.
Measuring Your Own Ecommerce Net Promoter Score
It takes just a bit of work on your end to calculate your NPS, but the insight you gain is definitely worth it. Let’s take a look at how to measure it for your ecommerce business:
1. Create your survey
By using the equation we detailed above, you can easily calculate your NPS. Simply Google “Net Promoter Score calculator”, and you will find tools like Survey Monkey and Gain Sight, which can help you figure out your NPS.
In addition, many customer service and support applications offer NPS surveys as a feature. For example, Zendesk has created this option for their users.
With one of these tools, create a simple survey and ask your customers to rate how likely they are to recommend your company to a friend. Additionally, you can also ask why they think your company earns that rating. Make it short and sweet: Users are more likely to participate if the survey is easy and short.
2. Distribute the survey to end customers
Once you’ve created the survey, it is time to get the survey in front of your customers. There are numerous ways to distribute the survey, but the easiest and most direct way is via email. Assuming you have a mailing list set up, this should be the default option for your distribution strategy. You’ll be able to easily track performance of the email, and make any additional tweaks to ensure they are opening and reading your request.
Another way to distribute is to add the survey to your website as a popup so it gets maximum attention from your customers. Using something like SumoMe (our popup tool of choice) would be a great way to draw attention to the survey and encourage users to participate.
You can also distribute the survey via social media and promoted posts or tweets. Whatever your distribution method is, be sure you make the language enticing and the survey simple. Tell them “it takes less than 5 minutes to complete” to encourage participation, or offer a reward in exchange. This could be a freebie or a discount – anything that helps ease your customer into providing feedback.
3. Analyze your results & take action
Once the survey is complete and closed, it’s time to look through your customer feedback. How did you score? Depending on where you fall on the NPS spectrum, there are a few different actions you can take.
If your results were mid to high, you could consider implementing a referral program. Lunatik, an ecommerce company that specializes in high-quality device protection, did just that. The company had a high NPS, so they created an entire app to incentivize referrals from their existing customers. This app allowed someone to show off Lunatik gear when asked about their own, and allowed the inquirer to enter their email within the app to receive a 20% discount on a purchase. The app-holder, in turn, receives 20% of the referral amount.
Obviously, building an entire app is quite an investment and not every ecommerce company can afford to go to such lengths in customer satisfaction. The most important thing is to take your NPS feedback and mold it into a solution for a better customer experience. website seo For some companies, that could mean implementing new customer service rules, for others it could mean implementing extra effort into personalization.
A good example can be seen in a recent customer experience gesture by NPS leader Warby Parker.
A customer recently visited a Warby Parker location to pick up her new frames. She got into a conversation with the employees and shared that her car had been stolen earlier that day. For good reasons, she was just having a crappy day. A couple of days later, she received a card in the mail from Warby Parker which had a gift certificate for $20 to a local bar. The customer shared the image on social media and it quickly caught fire.
Customer happiness: @WarbyParker sent a customer $20 to a local bar!
Implementing small, personal gestures such as this is a good way to reverse a low NPS and begin building relationships with your customers that will, in turn, convert them into brand advocates.
What is your Net Promoter Score?
Have you created a survey for your ecommerce business? What survey tool did you use? What did you do to take action on your customer feedback? Let us know in the comments below.