How to improve your Customer satisfaction with NPS ?

Dear hoteliers,

For years, monitoring guest satisfaction has ceased to be a complicated matter. You can analyse your guests according to a set of criteria which are specific to you and that suits you very well.

How do you carry out this analysis? Simple: ask all your guests to rate the hotel from 0 to 10 on a set of criteria (staff, cleanliness, service, breakfast, etc.) and then calculate an average.

When the calculations have been made, look at the lowest results and find out what’s going wrong.

Simple, but…

What if another method could make this task a great deal easier for you? And what if applying this other method could REALLY improve your ratings on Booking.com, TripAdvisor, Expedia, etc.? And what if one single question could finally give you a picture of guest satisfaction and of the guest’s desire to be loyal to your hotel?

You need NPS!

What is the NPS, or Net Promoter Score?

In December 2003, business strategist Fred Reichheld, known for his research into customer loyalty, published an article ‘The One Number You Need To Grow‘ in the famous Wall Street Journal. In this article, he introduced a loyalty indicator, the Net Promoter Score.

The indicator is calculated from this question posed to your customers: “How likely is it that you would recommend our company/product/service to a friend or colleague?”.

The scoring for this answer is based on a scale from 0 to 10 which allows companies to classify their customers as “promoters”, “passives” or “detractors”.

The promoters: Assign a score of 9 or 10.  The promoters are your most loyal and satisfied customers. Not only will they continue to buy your products (as regularly as possible), but above all, they will recommend your brand to other potential buyers such as their family, friends or colleagues.

The passives: Assign a score between 7 and 8. They are your satisfied customers but not as enthusiastic as the promoters. They won’t speak ill of you, but they won’t promote you for free to those around them either. On the other hand – and this is where you risk losing a lot of money – this is the category that is most vulnerable to offers from your competition. They are the ones who will return to your region via an OTA rather than coming back directly to you.

The detractors: Assign a score between 0 and 6. There are the people who are angry, the eternally dissatisfied or simply those who received very poor service during their stay. This category is dangerous. 35% of them will want to publish negative reviews of your hotel and, on average, they will criticize you negatively to 15 people in their close circle. Your detractors will damage your reputation and require a quick and proactive approach from you to try and transform them into future promoters.

How is the NPS calculated?

Very easily: we take the percentage of promoters and subtract the percentage of detractors.

For example, if you have 45% Promoters, 40% Passives and 15% Detractors, your NPS will be 30.

If your score is above 50, then it looks as if things are going pretty well for you. Here are some real examples to help you compare and assess your hotel:

Starbucks: NPS of 77

Netflix: NPS of 68

Amazon: NPS of 62

How can you leverage these results?

The theory is fine, but is there an easy way to leverage these results for your hotel?

Promoters : 2 issues need to be considered with promoters. Firstly, that they should remain promoters and secondly, that they should fulfil their roles as ambassadors to prospects.

They are your best customers and you need to make them aware of that by offering a little extra something that will be reserved for them alone. In addition, they will speak about you very positively if you encourage them to do so.

Why not give them a “BestVIP” code (only available on your site, of course) to offer them exclusive services and discounts? Most importantly, why not tell them that, as promoters, they have the right to share this code with all their friends, family, colleagues, etc.?

Passives : are very, very interesting. These are satisfied customers but they missed out on that very small, but all important wow factor that would have made them enthuse about your hotel. Very often, it could just be  little personal touch that was missing. That thing that would have made all the difference and have them saying “Amazing, I’ll be coming back!”

As an example, Sébastien (one of my closest childhood friends) used to spend two nights in a chain hotel close to his work almost every week. This was over a period of around two years. Then one day, the hotel was full and he was forced to book with the small independent up the road. The rooms were smaller and the hotel was ten minutes’ walk from his office. However, he booked his next three stays there.

Six months later, it turns out that he never went back to the chain hotel and became a loyal customer of the small independent which he had initially not much liked the look of. One evening I asked him: “Why did you decide to switch hotels?”. He replied: “The team is really great, and from my second stay, they remembered me and said “Hello Sébastien” and I loved it. It doesn’t matter to me that the hotel is farther away, and the rooms are smaller, I’ll still stay there”.

A few months later, I spoke to him again about the hotel. He told me that the service was so good that he had told his company about it (which turned over 130 million euros in 2018) so that they could contact the hotel directly. His company then signed a contract with the hotel so that its other employees could also stay there.

That’s a perfect example of thousands of euros earned thanks to a “passive” turned into a “promoter” thanks to a simple “Hello Sébastien! Lovely to see you again”!

Detractors : put your ego aside and PICK UP THE PHONE! Don’t hide behind an email or a response to a comment or other indirect form of communication. Pick up the phone and call that guest immediately.

70% of customers who feel that a company has genuinely tried to resolve their dissatisfaction will be willing to buy from that company again. Please note, we’re talking about a feeling that an effort was made to try and resolve the matter, not a problem that has been solved satisfactorily.

So, once again, pick up the phone and find out what really happened, listen and understand your guest. If the customer seems malicious, politely reply that your hotel doesn’t seem to suit their needs and apologise to them. Otherwise, do everything you can to compensate for the error.

By using this little tip, one of the first Expérience customers changed from leaving a one-star review on TripAdvisor to a loyal customer returning to the hotel every year.

The moral of the story is: Don’t bury your head in the sand!

The passive transformed, the Breakfast story

This way of classifying your guests into three types helps you to better organise your customer relationship. But above all, it allows you to implement a proper strategy to transform your passives into promoters. And it’s not just about getting better ratings. I’m talking about creating real ambassadors who will speak positively about you to around 11 people and who will stay in your hotel again whenever the opportunity presents itself.

However, to do that, you’ll have to take your understanding and customer segmentation to a whole new level. Here’s a brief example which perfectly illustrates this point:

The XYV hotel is located in a very fashionable part of the city (Soho in London, the Marais in Paris, the LA Fashion District, etc.). Therefore, it regularly welcomes fashion fans throughout the year, but also at certain key times such as Fashion Week.

This hotel offers a breakfast rated 8.9 on Booking.com. This breakfast is therefore excellent. However, an 8 is not a 9. This means that not all guests have left a 9 and that some will not be “promoters” of the breakfast, even if they weren’t that far from it.

Let’s put our imaginations to work: for example, what would happen if the hotel RADICALLY changed its breakfast during Fashion Week? What would happen if, during that particular week, all the products were organic and gluten-free?

Well… this group of guests, which is very concerned about healthy eating and their figure, after having stayed during this period, will be telling everyone about the XYZ hotel: “ABSOLUTELY AMAZING BECAUSE THERE WAS EVERYTHING I NEEDED FOR MY BREAKFAST!” And they will definitely leave a 10 out of 10 for the breakfast.

And, the icing on the cake, they will most likely overlook any little faults much more easily.

This is only an example, but it clearly shows how easy it could be to transform your “passives” into “promoters” if you improve your understanding of your guests and take the right action.

Conclusion

If you incorporate NPS into your guest satisfaction strategy, you get a real indicator that is both simple and effective, enabling you to:

Know your level of guest satisfaction;

Know the likelihood of your guests spreading the word about you;

Know your level of guest loyalty.

It is the simplest indicator on the market, making it easy to assess the quality and future of a business. It is precisely for this reason that all the biggest companies have adopted it (Apple, Google, Amazon, etc.).

Set up your own NPS and follow its evolution!

Is it going down? That’s an instant alert for everyone!

Is it rising? Celebrate: you’re managing your hotel very well 🙂

Thank you,

Tony Loeb