The One Number You Need to Grow

Frederick F. Reichheld in an article in Harvard Business Review says;

Numerous businesses, aiming to achieve significant growth through the cultivation of highly loyal customers, dedicate substantial resources to measuring customer satisfaction.   However, the majority of the methods used are complicated, produce inconclusive results, and may not necessarily be linked to profits or expansion.

The positive aspect is that costly surveys and intricate statistical models are not required.   Simply posing one question to your customers suffices: “How likely are you to recommend our company to a friend or colleague?” The more “promoters” your company garners, the greater its prospective growth.

The reason why the willingness to promote your company is such a strong indicator of loyalty and growth is due to the fact that when customers endorse you, they are essentially staking their credibility.   They will take this risk only if they are extremely loyal.

By posing this single question, you gather straightforward and current data that is associated with growth.   In addition, you receive responses that can be easily understood and communicated.   The directive to employees – “Increase the number of promoters and decrease the number of detractors” – becomes precise, actionable, and motivational, especially when linked to incentives.