Use a Net Promoter Score to Measure Check-in Effectiveness
The Net Promoter Score (NPS) is used to measure customer loyalty. The principle can be adapted to measure the value of a location-based check-in.
It stands to reason that if you have a high customer satisfaction, your company will grow faster because satisfied customers tell other satisfied customers about a product or service thus creating buzz or word-of-mouth marketing. This is the idea behind the NPS.
To create an NPS, you only needed to ask one question of your customers, namely, How likely is it that you would recommend our company to a friend or colleague? Group the responses into three groups:
Promoters are those who rate their likelihood a 9 or 10
Passives are those that rate their likelihood a 7 or 8
Detractors are those that rate their likelihood a 0-6
The net score is determined by subtracting the percentage of customers who are Promoters and subtract the percentage of customers who are Detractors. The resulting number is your Net Promoter Score.
Always follow up on with an open-ended question of why. These answers allow you to get a qualitative sense of why customers would or wouldn’t recommend your business so that you can do more of what is working and fix what isn’t working.
If you use Net Promoter Score (NPS), you can measure your check-in effectiveness. Follow these steps:
Collect at least 200 check-ins.
Pull data for another 200 customers that haven’t checked in.
Try to match the demographics at least on sex and age if this is possible with your 200 check-ins.
Survey both sets of customers.
Because loyalty is a little more difficult to calculate than something like net sales or share of wallet, you need to take a more qualitative approach to measuring. This is where the survey comes in. The goal is to get a sense of what the customer’s mindset is and whether your program is successful.
These types of questions determine whether the customer is already an advocate and whether they are using LBS:
Would you recommend Company ABC to one of your friends, neighbors, family members or co-workers?
Have you ever used an LBS to check into a business?
Have you ever used an LBS to check into Company ABC?A survey to test whether your location-based campaign is improving customer loyalty.
Always include a why or why not box when you ask whether your customers would recommend you. Not every customer will answer this question but for those that do, you can get a better sense of why they would or wouldn’t recommend your business.
Tabulate your responses in a spreadsheet.
From the number of customers who would recommend your business, subtract the number of customers who would not.
This number is essentially your net promoter score, although you should note that the official NPS is a formal measurement; this is only an approximation.
Compare your net promoter score for the population of customers who have checked in to that of the customers who have not checked in.
Ideally, your net promoter score for those checking in is greater than those not checking in. If it isn’t, you still have some work to do.
Don’t forget to look at any comments that customers left in your freeform responses. In particular, for those customers who wouldn’t recommend your business, you will want to find out why.