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Customer Satisfaction Simplified

by Walt Samuelson,
CEO of CustomerLink.com

There’s a very interesting article in Business Week, January 30, 2006 issue, entitled: “Would You Recommend Us?” The article was spawned from interviews with General Electric regarding their customer satisfaction measurement program. GE’s adoption of the concept reportedly came after a Harvard Business Review article on the subject.

The idea goes against most customer satisfaction measurement programs in that it reduces the customer satisfaction questions to just one simple question. Historically we were taught to be sure to ask at least three primary questions: 1) Are you satisfied with your service today? 2) Will you return to us for your next service? 3) Will you recommend us to your family and friends.”

The new concept, single question is: “On a scale of 1 to 10, how likely is it that you would recommend us to your friends or colleagues?” Pretty simple and very “clean” if you ask me.

The HBR article recommends that customers giving “likelihood to recommend” scores of 9 or 10 be considered “promoters”. Customers who provide a rating of 7 or 8 are considered “passively satisfied” and those providing a rating of 1 to 6 are considered “detractors”.

The suggested way to score this customer satisfaction data is to disregard the “passively satisfied” (7 and 8 scores) and use only the 9 - 10 and 1 - 6 data. You subtract the percentage of customers rating you 1 through 6 from the percentage of customers rating you 9 and 10 to arrive at your “new promoter score”.

The surprising statistic from HBR while researching this concept was that the “net promoter score” (percentage difference) correlated closely with a business’ revenue growth.

GE adopted this approach in all its businesses in 2006 and expects it to have even more impact on their business than their famous Sigma Six program.

The Business Week article goes on to hypothesize that determining whether a customer would put their credibility on the line by recommending your business appears to be a stronger indication of loyalty and future behavior.

Reading on I found that Intuit (maker of QuickBooks and TurboTax) uses the program. Since my oldest daughter, Kristi, works for Intuit I asked her if she knew anything about “net promoters”. To my surprise she said “yes, and my department’s score is…” It’s very impressive that a $2 billion company has adopted this concept so quickly and thoroughly. Add to that GE’s adoption and you can rest assured that others will be coming into the fold quickly.

Frederick Reichheld who wrote “The Loyalty Effect”, who I’ve quoted in the past because of its direct discussion of independent automotive service centers, is coming out with a book on the subject that will be titled: “The Ultimate Question”.

Asking the question is easy. How you use the results determines whether the question provides enough information for one to improve their business. That means you have to find out why those rating you a 1 through 6 did so and from their feedback determine what you can change to earn their 9 or 10 rating.

How does this apply to our much smaller businesses? Perfectly, I’d say – and you’ll see CustomerLink begin to survey our customers periodically with the single question beginning in March.

Let’s assume in one month you can get enough surveys back to establish your “net promoter score”. And, you contact those customers rating you a 1, 2 or 3 to see what you’d need to change to earn a 9 or 10. In two to three months you’d be well on your way to knowing more about your customers’ attitudes toward your business, have hard data to work with to improve, and should be able to track your “net promoter score” to see improvement.

Assuming the Harvard Business Review is correct, your revenue will increase as your “net promoter score” increases. Which makes perfect sense, doesn’t it? Customers who are willing to recommend you to others are more likely to use your service center for all their maintenance and repair work. They are less likely to expect discounts and more likely to keep their vehicle(s) properly maintained. It just seems to follow that more “net promoters” will mean more revenue!


One of our loyal customers (Larry Nassy of the Auto Clinic, San Francisco) shared this great article with us. It's obvious why he did. Larry's a smart business man and this customer survey system is pure gold.

Interestingly, the very same week I just so happened to get a customer survey from our local post office. Always eager to compare and contrast, I actually started filling the thing out, something I'm sure most people avoid at all cost. I soon realized it was 10 pages long! I thought "What!? Who has time for a 10 page survey?"

Needless to say, the post office never got my input. But, these two unrelated events solidified in my mind the importance of both customer surveys and being smart about obtaining them.

CustomerLink's CEO, Walt Samuelson, was generous enough to let us (AdRevamp.com) reprint his smart article here so we could share this great system with our loyal customers.

I'll spare you the reprint of that 10 page post office survey.

— Adam Strange
Account Supervisor
AdRevamp.com


If you have comments about this article you can contact Walt Samuelson, CEO of CustomerLink.com, at 916.774.1324, or send an email to: wsamuelson<at>customerlink.com.

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