Some people argue that NPS® doesn’t work effectively for B2B companies. We argue the opposite — Net Promoter Score® is just as valuable for a B2B company as it is for a B2C brand.
One reason for this common misconception is that almost all of the content available both online and offline about NPS® is aimed at a B2C audience:
- Most NPS guides are written with B2C brands in mind, using terms like “customers” instead of “clients” or “accounts”.
- The scale of NPS, in terms of the ability to reach thousands or tens of thousands of customers, just isn’t as applicable or relevant for an average B2B company.
Of course, this doesn’t mean that NPS isn’t an effective tool for B2B companies hoping to gain more clients and retain a greater percentage of their existing client base. In fact, NPS can be a powerful tool — possibly the most powerful at your disposal — for improving B2B retention.
Here’s why:
B2B surveys earn a higher response rate
Search online for information about the weaknesses of NPS for B2B companies and you’ll find a lot of content focusing on the limited scale of the average B2B company’s audience.
While it’s true that B2B companies typically have fewer customers than B2C companies, there’s a flipside to this coin. Because of the close relationship between a B2B company and its clients, it’s much easier for a B2B company to generate a high NPS survey response rate.
As we’ve explained before, the response rate is one of the most important factors for calculating the quality of NPS data. A higher response rate means better customer engagement, which in turn means a greater level of accuracy and a reduced risk of sampling and selection bias.
According to Bain & Company, the target NPS response rate for business to business brands is 50% higher than the average target for consumer-focused brands. While B2C businesses aim for up to 40% response rate, B2B companies are encouraged to seek a response rate of 60% or even more, when combining survey channels.
The response rate has a huge effect on the statistical validity of any survey. Thanks to the higher response rate of B2B NPS surveys, business to business companies can have more confidence in their data that allows them to make meaningful, effective decisions to improve customer retention.
Closing the feedback loop is easier
Another benefit of using Net Promoter Score for your B2B company is that you’re far more able to act quickly and decisively on customer feedback.
When you run a B2C business with hundreds of thousands of customers and tens of thousands of survey responses, sorting through feedback and quantifying which parts of your product or service need attention is a major challenge.
If your NPS software doesn’t offer a reliable feedback segmentation feature, then this can lead to analysis paralysis — endless analysis about which factors deserve attention the most, leading to a lack of action from your business and a total lack of improvements to your product or service.
In the meantime, instead of retaining the detractors that voiced their feedback on how you can improve (or better yet, working with them to turn them into promoters), you’re far more likely to simply lose their business.
In B2B, however, it’s possible to make rapid changes to your services and processes that will help you turn Detractors into Passives, Passives into Promoters and Promoters into enthusiastic and motivated evangelists for your company.
The closer your relationship with your customers, the easier it is to generate feedback and implement meaningful changes. In B2B, close business relationships are a norm, giving you far more power to quickly act on feedback and improve your customer satisfaction.
Strong relationships generate more meaningful feedback
In addition to helping you gain a higher response rate and a greater number of responses relative to your total audience size, a B2B customer base is more likely to produce meaningful, highhigh-qualitydback that helps you improve your product or service.
Great B2B companies revolve around teamwork, both between your team members and your team and its clients. This creates a stronger, deeper working relationship in which information flows freely from one party to the other as a matter of delivering your service.
As a result of this, it’s far easier to generate high quality, actionable feedback from B2B customers than from B2C. After all, you’re not a stranger to them — instead, you’re a trusted partner with a real working relationship.
Customers are more likely to contribute useful ideas
In B2C, it’s far from uncommon for customers to stick with one brand and ignore offerings from others. Usually, customers stay loyal to a company that feels familiar, personal and is a great fit for their needs in terms of pricing and quality. For example, a customer that’s satisfied with a certain car manufacturer might stick with them for years, or with an electronics brand, clothing retailer or athletic shoe company.
In B2B, it’s far more common for customers and clients to experiment with a number of different products and services from different companies. And that’s mostly because business to business companies have a certain list of mandatory requirements, such as certifications, security guarantees and so on. After all, B2B is all about results, and there’s no better way to produce better results than to experiment with different vendors.
This means that your customers can be a useful source not just of feedback on your product or service, but of ideas that can help you overcome your competitors.
If your clients and customers have used a variety of competing products and services, they can often tap into their experience to tell you where your offering excels, where it’s lacking and how it can best improve to outperform the competition.
It’s easy to miss out on opportunities to innovate when you’re stuck inside the “bubble” of your company’s daily operations. Tap into the knowledge of your customers and you could discover great ideas for new features, improvements, and enhancements to your product or service.
Is your B2B company using NPS effectively?
From deeper, more actionable feedback to the statistical accuracy made possible by a higher response rate, using Net Promoter Score to survey your B2B customers has a wide range of benefits.
Is your B2B company using NPS effectively? Retently lets you automatically survey your clients and customers using Net Promoter System to generate meaningful feedback and learn exactly how your business is performing.
Learn more about Net Promoter Score and start your NPS campaign with Retently.
