Author Archives: Dana Severson

About Dana Severson

Dana Severson is the Director of Marketing at Promoter.io and cofounder of Startups Anonymous. Former founder & CEO of Chasm.io/Wahooly and AngelPad Alum. In addition to focusing on growth at Promoter, Dana is a weekly columnist for Inc.com

Taxjar reviews

How Do You Outpace Your Competition? Follow This Approach From TaxJar

As Benjamin Franklin once said, “There is nothing certain in life, but death and taxes”.

While that statement is profoundly true, I’m certain everyone can agree that there is also nothing more painful in life than those same two things as well.

Where there is pain, there is usually an opportunity.

Promoter.io customer, TaxJar, is a company that’s solving one of those pains.

TaxJar is a 21-person company, currently serving over 8,000 clients, largely in the e-commerce space, which helps their customers simplify their tax requirements.


Here’s an example: If you’re someone that sells products on Amazon, you can choose to send your products into Amazon to be fulfilled and shipped. Those products are then dispersed to distribution centers throughout the country in order to be delivered quickly to customers.

That’s great for buyers, because now they can get their goods in “Amazon time”.

But, it’s not so great for sellers, because now they’re selling products in more than just one state. And, each of those states have unique tax requirements. Queue the migraines, right?

Enter TaxJar

They simplify this entire process through automation, so their customer doesn’t need to concern themselves with multi-state tax laws. The buyer is happy because they’re getting their products quickly and the seller is happy because TaxJar is making their job (heck, their life) easier.

That’s a winning scenario for any successful company.

But, with over 8,000 customers, it’s extremely important for TaxJar to maintain a pulse on the health of their relationships with their customers, otherwise they can risk making a painful process even more … well, painful.

The team at TaxJar turned to Promoter.io and NPS to help understand the impact they were having with their customers as well as test some changes they thought might improve the tax-paying experience.

In addition, they wanted to implement NPS to both prevent future churn and put their promoters to good use.

Note: As we’ve mentioned in previous posts, on average, only 20% of any given company’s promoters will actively endorse or refer new customers without further communication.

Activating the additional 80% requires a company to proactively reach out to their advocates and make specific requests that can directly (and positively) impact the business. These requests may include customer reviews, social shares or simply asking for them to refer someone new.

Promoter.io offers custom “Thank You” pages to make the immediate connection between excited promoters and positive shares an easy task, which ultimately impacts organic growth.

The way that TaxJar started with NPS was a bit unique.

Prior to beginning the process, they had become aware of a big gap in their product offering. Or, at least what they perceived to be a gap. But, they weren’t certain.

The team at TaxJar decided to release a new version of their app to a select group of their customers to address the potential gap.

To properly measure whether this new version actually made a difference in customer loyalty, they decided to segment their NPS into two groups:

  • Customers who have access to the new version
  • Customers on their legacy version

What they were ultimately looking to see is whether customers on the newer (beta) version had a higher level of customer sentiment and loyalty than those on the older plan.

After the results were in, they were able to properly validate their assumptions when they discovered those that had access to their beta app gave them an overall NPS score in the 80’s (world class), while those on the legacy version scored them in the 50’s (still great, but measurably lower).

Note: For early stage companies, NPS is a great measure of PMF (Product Market Fit). After a tool is on the market, NPS can help you validate your ideas/assumptions via your beta customers willingness to recommend others.

As a process, TaxJar collects their data by surveying 200 randomly selected customers each month from both groups. Those customers then receive continual surveys every few months, allowing TaxJar to maintain an ongoing understanding of sentiment.

Measuring NPS is most impactful when you do it over time, but that’s especially true for TaxJar. With different tax laws and filing dates with each unique state, each customer has unique user experiences based on their individual tax situations.

Staggering their surveys has been critical success factor and value point as it has allowed TaxJar the ability to gauge the sentiment of their customers over time, both as the product matures and as tax laws continually change at the state level.

In addition to the insights they’ve gained from their customers, they’ve also been able to drive their business forward in several other ways as well.

TaxJar thrives on the reviews from their customers, especially since many of them are Amazon sellers, who deeply understand the impact that positive reviews and brand perception themselves.

Through their NPS campaign, the TaxJar team was able to identify their promoters and activate them by asking directly for reviews of their experience.

Since starting their Net Promoter program, they’ve gone from zero customer reviews to over 60 in very short order, 100% a result of their Net Promoter and customer engagement efforts.

They’ve been able to leverage these reviews beyond customer validation, by also including them within the onboarding experience as well as across numerous product landing pages.

With detractors, they’ve been able to differentiate themselves from their competitors by personally responding to each piece of feedback and being attentive to their needs, getting ahead of potential churn before the customer has made that decision to leave or find another solution.

TaxJar operates in a space where their closest competitor is a large company with impersonal communication. They’ve used this to their advantage by giving their detractors (and promoters) individual attention that they wouldn’t receive elsewhere.

———–

TaxJar is great example of a company that has utilized NPS to not only improve their product over time through customer insights, but also to support their passion of over-delivering on customer experience. 

As a result, they’ve found their secret to outpacing their competition.

Dana Severson

Dana Severson is the Director of Marketing at Promoter.io and cofounder of Startups Anonymous. Former founder & CEO of Chasm.io/Wahooly and AngelPad Alum. In addition to focusing on growth at Promoter, Dana is a weekly columnist for Inc.com

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Uber Has a Major Customer Relationship Problem

A few years ago, I was taking an early morning flight home from Atlanta. Since it was 5 in the morning, I didn’t feel like standing outside to wait for a taxi, so I decided to use Uber.

As with most of my Uber experiences, the car arrived promptly, the driver was courteous and personable and the ride lasted no longer than expected.

That’s as much as I need as a passenger.

At the end of the ride, the driver thanked me and asked if I’d be willing to provide him with 5 stars for the ride?

Hold up, I thought.

If you’ve never taken an Uber before, after your ride has concluded, you’re prompted within the Uber app to provide the company with a driver/ride/experience rating on a 5-star scale (1 star being bad, 5 stars being great).

Not only are you prompted to rate the driver, but the driver is also prompted to rate you (the passenger).

According to Uber’s description of the star rating system, it’s intended for the protection of both the drivers and the passengers.

To ensure the quality of both the driver-partners and riders in the community, our rating system is a two-way street. Driver-partners must rate every completed trip, while riders have the opportunity to submit a rating along with comments.

Ratings, which are given on a scale of 1 to 5 stars, should be honest and reflective of the overall trip experience.

So, why my hesitation when being asked by my driver to provide him with 5 stars?

Well, up to that point, I didn’t realize it was a game.

Within that single question, I realized that their entire star rating system was nothing more than a mutual admiration society. An I’ll scratch your back, if you scratch mine transaction. The equivalent of a circa 1990’s link exchange.

Up until he asked me that question, I actually took those ratings seriously.

Frankly, at this point I don’t even remember the rating I ultimately gave him, but I’m sure it was 5 stars. And, in all honesty, after I left his car that morning I hadn’t really given it any further thought.

That was, until just recently.

Unless you’ve been sitting under a rock for the past few months, you’ve probably caught at least one or two of the controversies to hit Uber this year. To say it kindly, it hasn’t been a good 2017 for Uber so far.

From claims of sexual harassment, to a lawsuit for theft of intellectual property from Google (their investor) to a video of its figurehead, Travis Kalanick, screaming at one of its drivers, the company has been under constant fire.

Since the bad news began, it has seemed like a never-ending barrage of negative revelations that continue to pile up upon each other.

As a result, their detractors have started a hashtag campaign #DeleteUber, which according to reports, has resulted in between 200,000 to 500,000 app deletions. Or, in other words, lost customers.

I’ll be honest and say that, among the lost customers, I’m not one of them.

I still have my Uber app and I’m likely to use their service again in the near future.

That doesn’t mean that I support the things they did, nor does it mean that I’m a promoter (i.e. advocate) for their company.

In fact, given the stories that have come out, I wouldn’t dare endorse them. And, I’m guessing that they don’t have many promoters left willing to do so either.

BUT …  they wouldn’t know that.

Why?

Because transactionally (A.K.A. their 5 star rating system), customers don’t have a problem with their product or service.

And even if they did have a problem, we already know that the drivers and riders are gaming the feedback system to support each other, so the data is inaccurate at best.

If this were a CSAT (Customer Satisfaction Survey), Uber would be winning in the minds of customers. If this were an NPS (Net Promoter Score) survey, they’d be DOA.

Uber has a problem. And, it’s not just the bad headlines.

Uber has a relationship problem.

Overall, customer relationships are so much greater than the transaction that occurs between the customer and the company.

A customer can have a bad transaction and still have a great relationship with a company. Much like a married couple could have an argument but still be in love.

A customer can have a bad transaction and still have a great relationship with a company Click To Tweet

However, if the core relationship is poor, if there is no love between a couple, there is nothing that binds them together.

Uber may still have a lot of customers, but their future prospects are not looking bright, because relationally, people are not happy.

In the 5+ years that I’ve been using Uber for transportation, I haven’t once received an NPS survey from the company.

Never have I been asked to rate the company on a scale, only its drivers.

As far as Uber knows, based on the ride ratings I’ve provided, I’m a happy customer.

And, from a transactional perspective that’s fairly accurate, but it’s only a very small part of my story as a customer.

They know nothing about my intentions to ride with them in the future, or whether I might be willing to defend them in the comment section of a scathing story. Maybe I’m one step away from jumping on the #DeleteUber bandwagon or maybe I have some insights that could save their company.

But, Uber will never know this until they start caring less about the transaction and more about the relationship with their customers.

If Uber wants to get ahead of the problems they’re currently facing, they’re going to need to get serious about communicating with their customers.

This means engaging with each customer individually and in a meaningful manner. Listening to their needs and providing solutions.

Unfortunately their superficial 5-point rating game between driver and passenger isn’t going to cut it.

Like any couple facing challenges in their relationship, this may require therapy. In Uber’s case, that therapist is NPS.

Dana Severson

Dana Severson is the Director of Marketing at Promoter.io and cofounder of Startups Anonymous. Former founder & CEO of Chasm.io/Wahooly and AngelPad Alum. In addition to focusing on growth at Promoter, Dana is a weekly columnist for Inc.com

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The Important Difference Between Customer Satisfaction and Customer Loyalty

The following post is an excerpt from Chad Keck’s upcoming book on Winning with Net Promoter. Complete the form at the bottom of this post if you’d like to be notified when the book becomes available.

How many times have you heard that customer satisfaction is the key to a long lasting, successful business? Or that, if you want to succeed in today’s ultra-competitive environment, your company needs to be obsessively focused on customer satisfaction.

Let me venture to guess that you’ve heard it so many times that it’s almost become a cliché.

While this idea contains a profound truth, it also contains a profound error.

I’m not saying that customer satisfaction is not important — it’s critically important.

I mean, if a customer leaves a store having purchased an overpriced product with a subpar customer experience, yeah they’re a customer, but they’re not happy about it and they’re likely not to return and convince others to do the same.

Knowing what made them dissatisfied is very useful information in those situations.

But even with the happiest customer experience, one in which the price was reasonable and the service was stellar, satisfaction is still backward looking. It only measures whether someone was happy with your product, service, or interaction. It tells you nothing about their future intent.

The most important information for the success of your business is that which is forward looking.

You need to know how customers will behave in the future. Will they buy your product or service again? Will they recommend your business to a friend or colleague? Will they rave about you to their Facebook and Twitter followers. Or, will they get your logo tattooed on their forehead?

Believe it or not, you don’t need some sort of fortune teller named Zoltar to show you whether or not you’ll have that loyal, tattoo-branded customer. If you listen, your customers will tell you themselves.

Customer Satisfaction vs. Customer Loyalty

One of the biggest mistakes businesses make is that they focus on customer satisfaction rather than customer loyalty. It’s easy to do because most people don’t even know the difference between the two. But the difference is as important as the difference between a loyal romantic partner and one who’s merely satisfied. Think about that…

To succeed, you NEED to focus on customer loyalty rather than customer satisfaction Click To Tweet

Customer loyalty measures something more than satisfaction — it measures whether someone is willing to put their name on the line and recommend your product or service to others or if they are willing to stick with your product/service in spite of an occasional poor experience.

It’s easy for a customer to tell you they’re happy with your performance. It’s a lot harder to get them to say they’d recommend you to a family member, friend, or colleague, because now his reputation is on the line. No one wants their mother-in-law to call him up at two in the morning yelling, “Why on earth did you tell me to buy this horrible mattress …  I can’t sleep!?” A routine mother-in-law call is bad enough as is.

The fact is, there is no correlation between someone saying, “I’m satisfied” or not, and almost any other important metric:

  • How much more of a product or service they are going to buy (upsells / expansion revenue)
  • How long they’ll remain a customer (retention / churn)
  • Her willingness to recommend or refer a business, friend or colleague (organic growth, lower CAC, higher LTV)
  • Levels of customer support engagement

As far as your knowledge of that customer’s behavior is concerned, it stops at knowing his/her level of satisfaction.

In a sense, customer satisfaction is a feel-good metric. It’s easy for a customer to say he’s satisfied.

When you hear a company like GEICO say that 97 percent of its customers are satisfied, it’s good marketing, and I’m sure it makes the GEICO team feel proud. But stats like that don’t actually correlate to customer behavior. The next time a GEICO customer hears from a friend that USAA, for instance, is incredible and that he swears by it, that GEICO customer is probably going to pick up the phone and give USAA a call.

On the contrary, a loyal customer wouldn’t be so quick to leave at the first sign of a better option. In fact, they would be the one that would come to your defense and likely bring their friend to your side.

To say it again but in a different way, if you want to succeed in today’s ultra-competitive environment, your company needs to be obsessively focused on customer LOYALTY, not satisfaction. The difference is paramount.

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Dana Severson

Dana Severson is the Director of Marketing at Promoter.io and cofounder of Startups Anonymous. Former founder & CEO of Chasm.io/Wahooly and AngelPad Alum. In addition to focusing on growth at Promoter, Dana is a weekly columnist for Inc.com

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LiveChatHero

How LiveChat Used Customer Loyalty To Grow To Nearly 19k Customers (without spending money on sales and marketing)

One of the most common reasons why companies decide to start measuring their Net Promoter Score is to understand the precise needs of their customers and to be able to address each one on an individual basis. The net result is most often an increase in customer retention and an overall improvement in customer loyalty.

At the end of the day, customer loyalty is the ultimate goal for EVERY company. With St. Patrick’s Day right around the corner, you could say it’s the equivalent of the pot of gold at the end of a rainbow.

Customer loyalty isn’t always easy to attain however. It’s only achieved when a company can exceed the needs and desires of their customers. This means an exceptional customer experience along with a superior product.

 Exceptional Customer Experience + Superior Product = Customer Loyalty #NPS #Custserv Click To Tweet

Since loyalty is tied directly to the customer’s overall experience, we often see that NPS becomes a tool most utilized by customer support or customer success teams.

The other half of Net Promoter is growing your business through advocacy (i.e. your loyal customers). This is one of, if not the most lucrative benefits of measuring NPS. For most companies, it’s the added bonus to increasing customer loyalty and retention. But for a marketing department, it’s an all-access channel to increasing revenue without expense.

Most companies don’t start measuring NPS as a marketing initiative, but that’s not the case with LiveChat.

LiveChat is a fast-growing customer success software with offices based in both the US and Poland whose name aptly describes exactly what the company does — provides a tool for chatting with customers in real-time (or live) while they are on your site.

Since pivoting from an on-premise software solution to a SaaS solution in 2010, LiveChat has been on a strong growth trajectory. As of today, they serve almost 19,000 customers, adding 400 net new customers per month! What’s more, they’ve grown without spending any money on outbound marketing or sales.

While most SaaS companies are investing heavily in Facebook ads, SEM (search engine marketing), PPC (pay per click) and internal sales teams, LiveChat has been focusing exclusively on inbound channels — SEO, branding, content and … NPS.

At LiveChat, NPS lives within the marketing department. Their focus is on solving customer issues to increase loyalty (and preventing negative word of mouth) as well as leveraging promoters for growth.

What makes their approach unique is the fact that they treat NPS as a marketing initiative first.  

However, unlike the natural approach of most marketers, they still respond to each and every customer personally, without the use of automation (the way it should be done).

In most cases, when someone identifies themselves as a promoter, the LiveChat team will engage with that customer through a personalized message along with a direct request for a referral or asking them to leave a review on one of the many sites they use — G2 Crowd, Capterra, TrustPilot, etc.

Activating Your Promoters

As we’ve mentioned in previous posts, roughly only 20% of your total promoter base is actively endorsing your brand and/or referring new customers your way. Activating the other 80% of your promoters is often times as easy as simply engaging with them with specific requests. You could be asking for a referral or a review as LiveChat does. The fact is, EVERY one of your promoters have already indicated they’d recommend you to others, you just need to guide them on how best to do it.

“We’ve identified and know that a large number of our new customers come in as a result of the many customer reviews we have out there.” – Daniel Zieliński

LiveChat’s customer engagement doesn’t just end with an ask though. Daniel Zieliński, who heads up their NPS initiative originally came from a customer success role, so he understands the importance of closing the loop with each and every customer.

In the case of detractors and passives, Daniel will initially engage with the customer in an attempt to initially solve their problem and prevent any negative public comments. He’ll then pass the discussion along to the customer success department to ultimately resolve any larger issues.

Promoters can be more than a recommendation

Often times companies will take promoter feedback at face value without digging deeper. In most cases, a promoter may give you a 10 and state something like, “I love everything about the product”, as the reason for their score.

That’s a fantastic comment to hear, and this is a customer that is definitely ripe for a referral or some other kind of growth based promotion.

But, wouldn’t it be great to know even more? Why do they love your product so much? Maybe loving your product isn’t the best you can do.

What if they had more to offer than simply promoting you to other likely customers?

That’s what Zieliński likes to find out.

In a recent exchange, LiveChat had a customer who had given them a “10” and stated “It’s awesome.” as the biggest reason for their score.

Wanting to know more, Zieliński followed up with the customer, thanking them for their support and asking if there was anything more they could do to make it even better than “awesome”.

It turned out that this customer had an idea to improve their product and was willing to go as far as creating a mock-up of how it should work (see mock-up below).

mockup_personal greetings

Customer Mock-up

It just so happened that the product development team at LiveChat had been considering a similar enhancement, but was still hung up on how to best execute it.

This promoter was able to help the dev team visualize how the feature should look, which they loved and built out and pushed live in the next two weeks!

The feature, LiveChat personal greeting, ended up becoming a big hit!

Finished product

Finished product

“Thanks to Harry (the customer), when you see someone from Paris browsing your website, you can instantly deliver a personal message in the right language or ask them how the weather is in Paris, etc.”, Zieliński stated.

Closing the loop with every customer, from detractors to promoters, is one of the most value-rich actions you can take within your NPS program. Sometimes that can mean something as simple as thanking them for their feedback and other times it could be engaging on a much deeper level.

Not every customer will provide you with a referral or a mock-up for your next great feature, but engaging with them will show that you listen and care about what they have to say. Whether the customer loves you or not, showing that you care is the key to driving long-term loyalty.

For LiveChat, a company that doesn’t spend money on any outbound marketing initiatives, increasing brand loyalty is the major key to their continued growth.

Through NPS, Daniel and his team have been able to turn loyalty into referrals, which currently represents roughly 30 – 40% of their overall revenue.

Ultimately, your current customers represent your biggest opportunity for growth (both product and revenue). And, as LiveChat has learned, you don’t need to spend an enormous amount of money to access them.

If you’re willing to commit to taking the necessary steps to running an NPS campaign the “right way”, you’ll see amazing results. Just ask Daniel.

——

NPS-Playbook-Cover-ThumbP.S. We’re giving away all of our best practices, strategies and tactics for implementing, measuring and acting on NPS successfully for SaaS companies – from beginning to end. Over the past few years, some of the top companies in SaaS including LiveChat, MailChimp, Intercom, Adroll, ConvertKit and more have turned to Promoter.io for our guidance and expertise.

All of those lessons and guidelines are now available to you for free in the book below. Download and give it a read today!

Dana Severson

Dana Severson is the Director of Marketing at Promoter.io and cofounder of Startups Anonymous. Former founder & CEO of Chasm.io/Wahooly and AngelPad Alum. In addition to focusing on growth at Promoter, Dana is a weekly columnist for Inc.com

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Why Marketing Campaigns Fail

I have something to confess to you. It’s embarrassing, and I was struggling about whether to tell you about it. But first, I have a question for you …

Why is it that most of your marketing campaigns aren’t as effective as you’d like them to be?

Come on now, it’s just you and me here chatting. You know what I’m talking about. You had grand plans, didn’t you? You thought that last one was really going to go viral, right? But it never hit that critical mass, did it?

How do I know? That’s where my confession comes.

My last campaign for Promoter.io bombed.

That isn’t quite honest. It did get a lot of views. But those views never turned into paying customers, so really it just made a lot of noise for no return.

But why did my campaign bomb? I have spent a lot of time thinking about that, and I think that the answer to that question might just be applicable to you and your marketing campaigns. It’s always easier to laugh at someone else’s misfortune, so maybe by studying my failure, you might gain insights that will prevent you from making the same mistakes.

Let me tell you a little bit about this campaign. Elections in 2016 had been a huge hot button issue. We thought it would be interesting if we ran a national Net Promoter Score® survey in order to gather sentiment that might give insight and clarity to the election. So we invented something new … The Net Presidential Score.

Could we predict who would become the next POTUS by NPS score?

Could we predict who would become the next POTUS by NPS score?

You can read about it more on our blog but it worked much like any regular NPS survey. We asked on a scale from 0-10 how likely you would be to recommend each presidential candidate to your friends and colleagues. Then we posted the results for the world to see.

At the time we came up with the idea, it seemed like just the kind of campaign that could go viral. Who knows … maybe we would even be invited to discuss the idea on TV. The sky was the limit.

And if you looked at our analytics, you might have called it a success too.

But the conversion rate from views into customers was next to nil. I sat down with one of our advisors recently and explained the campaign to him. I asked him where did it go wrong? What he told me was really insightful.

He said that he always looks at marketing campaigns through the lens of a Venn Diagram. He took a napkin and drew three overlapping circles.

Venn Diagram

In the first circle was what your product does. In the second circle was what customers want — their deepest desires. In the last is what the press/media/Facebook/Twitter wants.

Here is where I first wanted to interject. I wanted to argue with him. Facebook and Twitter in the same group as press and media? But then I realized that Facebook and Twitter are two of the primary places that I get my news these days, so I just kept quiet.

The Presidential election stunt was clearly aimed at the press/media part of the Venn diagram. It also overlapped nicely with the product circle. But why did it not end up converting to paying customers? Because it missed the third part of the Venn diagram.

The Presidential election stunt didn’t overlap at all with the deepest desires of our ideal customer.

How many times have you watched a funny commercial on TV and had no idea what they were trying to sell? Same problem. The campaign might be viral. It might show off your product. And still nobody cares.

Who gets this right? There are plenty of examples. In TV, Budweiser almost always hits the trifecta. Funny commercials that go viral, show off the product, and overlap with the deep desires of their customers. Another TV example is the Axe body spray commercials or Old Spice.

Or, how about this video that has been seen over 33 million times:

One of the most brilliant examples of a company hitting the trifecta was done recently by a Promoter.io customer, Jet.com.

Careculator

During this past Holiday season, Jet.com launched a campaign called “Careculator”. The concept was to put a price tag on your friendships online — via Facebook.

The way it worked was you’d connect your Facebook account and it would analyze and calculate the amount you should spend on each friend on Christmas. The calculation was based on the number of times your friend had engaged with you (i.e. liked your post, commented, shared, etc.).

As a marketer, I was impressed. Like, seriously impressed.

Price of friendshipThe calculator was fun and ingenious, but what really made it smart was that they made it super viral. I mean, of course I’m going to share the amount my friend is worth on Facebook. In my case, it was my wife. And I was sure to rub salt in the wound.

But, what really completed the trifecta was the final component to the campaign, which was to recommend gifts that were available on Jet.com that fit within the dollar amount calculated for each friend.

Brilliant.

They absolutely nailed the trifecta.

Product/Customer/Media. You need all three. You can’t just pick two. The graveyard of failed marketing ideas is full of ideas that just pick two.

So don’t let yourself fall into the trap. Let our failed campaign serve as a reminder for you.

Dana Severson

Dana Severson is the Director of Marketing at Promoter.io and cofounder of Startups Anonymous. Former founder & CEO of Chasm.io/Wahooly and AngelPad Alum. In addition to focusing on growth at Promoter, Dana is a weekly columnist for Inc.com

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