Satmetrix last week released its 2010 European Net Promoter® Scores and I thought it would be interesting to review them versus recent Australian data[1].
Banking
The highest of the European banks (First Direct) received an NPS of 42% compared with the highest of the Australian banks (Bendigo Bank) at +33%. At the other end of the scale the lowest European score is -26% versus -39% in Australia.
Mobile Phone Networks
Moving on to look at mobile phone networks the best of the best in Australia (Virgin Mobile) scored 0% compared with the best in Europe (O2) of 24%. At the other end of the scale Australia’s lowest score was -34% and Europe’s was only -13%.
Why the Differences?
Scores in Australia would, on the basis of these numbers, seem to be lower overall. Why?
Two potential reasons are:
Australian Service delivery is worse than European Service Delivery
Lower NPS scores in Australia may indicate that the very nature of Australian service is lower than that experienced by European customers. There is no definitive way of determining if this is the case.
I know that there is a wealth of anecdotal evidence collected by travellers to both regions of the service levels in their counter parts but there is no convenient impartial way of collecting that data.
Australian’s have higher service expectations than Europeans
This is the second potential reason for the differences in scores and identifies a cultural bias in the outcomes of the Net Promoter Score process. If Australian customers simply have higher expectations from customer service it would drive down the NPS for that region even if the service levels were the same.
Of the two suggestions, I am more inclined to believe that it is the second (higher service expectations) that is the driver for the difference in scores. This may connected with the infamous Australian Tall Poppy Syndrome, whereby Australians are just a little less inclined to give maximum praise for a job well done.
Either way it reinforces the one of the tenants of NPS or any customer loyalty measurement system. The absolute score is not as important as the score relative to competitive peers and your own score in the past. Focusing on understanding what is important for customers and how to improve your score day in day out, month in month out is the driver of long term success.
This result also underscores the critical role that customer service expectations have in determining customer satisfaction with the service delivered. This recent post (Customer Charters: Good or Bad for Customer Satisfaction) discusses the issue of service expectations in more detail
For more information on Net Promoter Score and how/why it works download our free Introduction to Net Promoter Score (NPS).
If you are thinking about implementing Net Promoter Score (NPS) in your organisation give us a call. We can help you to implement an effective Net Promoter Score program for your business.
[1] “The 2009 Consumer Recommendation & Loyalty Study”, Engaged MARKETING Pty Ltd
Net Promoter, Net Promoter Score and NPS are registered trademarks of Bain & Company, Inc., Satmetrix Systems, Inc., and Fred Reichheld
It’s funny, but usually at our first meetings with a clients’ Head of Research, they say something like “You know, Net Promoter might work OK in other countries, but it’s a well known fact due to culture differences that our country scores much lower than others, so therefore NPS will not work here, which is why we use the 6 Hieroglyph Symbol* method to accurately benchmark our countries score, carefully adjusted to match with the overall 5 Smiley-Frowny Face Scale we use on our global survey blah blah”.
Forgive my simplistic approach here, but we have measured many different countries supposedly receiving the same service from a company using NPS. And you know what? The differences are more explainable by differences in service delivery than any cultural differences. The “country-X-people” never giving a 10? I beg to differ, and have the proof that customers worldwide will award a 9 or 10 to exceptional service.
And usually the people that matter in the company can recognise the issues, and work on the ones to improve. Which supports your point that benchmarking against peers, and improving your own score is the place to start.
*Fictional but typical of the hubris of some proprietary research companies.
Adam,
Could not agree more: the NPS approach is relevant regardless of your country.
I also agree that people in every country will give a 9 or 10 for exceptional service, even those in Australia, and they do. However, what some someone perceives as “exceptional service” is heavily influenced by their service level expectation. For example, the service I would give a 10 for at McDonalds is not even close to the service that a top restaurant would need to provide to receive a 10.
This is where I think the difference lies: not in cultural propensity to give a good score but in cultural expectations of what defines good service.
Of course we can discuss the reasons why there are differences but I think we are in strong agreement on the key point: focus on improving your own score and it will show dividends in revenue growth.
Speaking as an Australia living in the UK (13 years) I can say that service levels in Australia are very noticeably lower than those in Europe. In fact I would go as far as saying that in the 13 years that I have lived away from Australia (I visit at least 3 times every year) I have noticed a marked relative deterioration of service in Australia compared with Europe and in particular the UK.
Martin,
Thanks for your comment.
Yes – I have to say I suspect that Australian service is not as good as some other parts of the world but I am never sure whether I’m being harder on local establishments than I am when overseas.
Adam
So what’s the go with the interviewers? I have a business that is NPS measured by one of the manufacturers I represent. We survey our clients and get great scores and around 80% Promoter. When this company surveys their VERY SMALL sample, it comes back totally a different ratio. More like 43% Now despite our own clients telling us that they feel like they were LED down a path and some say they did not give a score at all ad were not asked, how do you measure your business.
We don’t interview the client, we opt for a letter form instead but similar questions, asked the way you would expect in Australia. The one at the end is the critical one and there is a vast difference between HOW we ask the question on paper V their live interview way…
David,
There are a few points you bring up here:
1. Small sample sizes can impact score: NPS is very susceptible to variation in small sample sizes. This is due to the way that the score is calculated: % of Promoters – % of Detractors. You do need to be very careful comparing NPS where there are small samples.
2. Survey form can impact score: all things being equal different types of survey instrument (face to face, internet, letter) can exhibit different NPSs. It’s no surprise that your letter survey and their phone call deliver a different score. By the way these days I would not recommend letters as your survey instrument. Internet surveys will boost response rate and face to face or telephone interviews will boost the critical qualitative feedback that you need to make sense of the scores..
3. Survey confidentially can impact scores: When you survey customers directly the loss of confidentially can impact on the score they give you. (Many) People will not want to hurt their relationship with you by giving you a low score. A third party survey contributes to the confidentially of responses and so people will tell you want they really think more readily.
4. Survey question bias can impact score: The way questions are asked can also affect the score so it may well be that your manufacturer is asking the questions in a different way and impacting on the score.
Regards,
Adam