How NPS Helped Grow A $174,000/Month Business

This is an excerpt from our upcoming NPS book which will be published this year.

Alex Turnbull’s an entrepreneur who lives in Rhode Island with his wife and dog, Honey Badger. When he isn’t building startups, you might find him surfing. But when he is working on building his startup, you might find him reading through Net Promoter Surveys (NPS).

What does Alex think is the single most important part of running NPS? I will tell you in just a second.

If you don’t know Alex, he started Groove, a help desk software company, in 2013 and grew it from no revenue to over $174,000/month in just 2 years. Now he’s become obsessed with growing it to $500,000/month in revenue.

For any business big or small, growing by 5X requires some major tools. That’s why Alex focused on NPS recently.

Groove’s First NPS Score Result

Groove is a simple help desk software that helps businesses manage customer support. In June 2014, the company used to measure its NPS score. What do you think his score was?

Beginners tend to obsess about their number. If it’s too low, they don’t want people to know. If it is very high, it’s the only thing they will talk about. There are even companies dedicated to benchmarking NPS scores.

In hotels, Westin recently got a +59. Motel 6 got a -15 (more detractors than promoters). Netflix got a +54 and Blockbuster On Demand got a +11. Southwest got a +62 and US Airways got a -8.

But as Groove CEO Alex Turnbull noted, “[O]n its own, that number is pretty meaningless to us. But as a benchmark metric for gauging the sentiment of our customers, it’s absolutely critical and precisely the reason that we did the survey.”

Groove started its NPS journey in the good zone with a +11. On par with Blockbuster On Demand’s score.

Alex didn’t get upset or even spend a lot of time ruminating on the absolute score. Instead, he recognized that the score was just a starting point, and that the real goal was to move the needle forward by the next time they surveyed their customers.

How To Use NPS Feedback

In order to move the needle forward, Groove focused on learning from the open-ended feedback they received from customers. According to Alex:

If there’s one tactic you take away from this post for your own NPS surveys, I hope it’s this one: do not neglect to follow up with your customers after the survey.

The feedback we got opened a lot of doors for conversations with our customers we might not have otherwise had. In some cases, it helped us dig in and get to the bottom of tough product issues that our customers were facing. And in many cases, it strengthened our relationships and made customers happier.

Alex took the time to tag each and every response from his 1,901 users so that he could keep track of any trends.

Here’s one example of how Alex and his team used that feedback. After their first survey, they discovered through the tags that the major trending driver of customer loyalty was the simplicity of its software, which Groove regards as its central mission.

In Alex’s words, “we’ve set out to build the simplest help desk software out there. A huge focus of ours in the last few months has been tackling some long-standing bugs that have been hurting the user experience for some groups of our customers, as well as putting a lot more ‘general polish’ on our app.”

Groove’s Second NPS Score Result

After three months of polishing and bug fixing, Alex decided to run another NPS campaign.

I bet you want to know the score, don’t you? Haven’t you realized that the score isn’t the important part yet? Ok, ok, I’ll tell it to you anyhow. But first, let me tell you about the driving trend update.

When they surveyed their customers a second time, customers who named “simplicity” as the main reason for loving Groove went from 48 percent to 55 percent. Fortunately all the work Alex had put into tagging those responses made it easy to calculate.

These and other changes helped Groove increase its overall NPS score to +16 in just three months. That’s a great result for any business because the direction the score is going is of much more importance than the absolute value at any point in time.

Would you rather have a +60 score that hasn’t changed in 2 years or a +50 score that keeps going up every 3 months? I always prefer growth to stagnation in any key metric.

As Alex summed up his experience:

NPS has been a game-changer for us. It doesn’t just give us incredibly valuable feedback directly from our customers, but it gives us an important benchmark to measure ourselves against each quarter, which is the critical piece missing from most customer feedback approaches.

It can certainly be painful to have customers give you negative feedback on your product, but think about it this way: if you didn’t give them this channel to share their thoughts with you, they’d probably never say a word; instead, they’d simply leave. Getting honest feedback every quarter has helped us build a much stronger product by showing us exactly what we need to be focusing on. I’d recommend it to any founder.

Alex is an exceptional entrepreneur, not only because of his ability to grow companies, but because of his innate ability to focus on the important parts of his key metrics. He doesn’t flip out when a score comes in lower than he hoped. He just focuses on what he can do to change it for the better. May we all be able to cultivate that kind of wisdom in our lives.

4 thoughts on “How NPS Helped Grow A $174,000/Month Business”

  1. Great read, Chad! I really like this: ”If there’s one tactic you take away from this post for your own NPS surveys, I hope it’s this one: do not neglect to follow up with your customers after the survey.”

  2. For a small startup without a huge user base, do you guys have any recommendations for how to successfully utilize NPS? I’d love to use this metric but we’re brand new and growing (slowly).

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