The well regarded management thinker, Peter Drucker, is credited with the saying, “If you can’t measure it, you can’t improve it.” It makes sense, right? You don’t know if you are doing a good job unless you examine the results. And you don’t know how good those results are or if they are improving unless you compare them to someone else or over time within your own business.
To that end, many measuring systems have been developed over the years to solve this very important function for business leaders. None is probably more well known or widely utilized in modern business than the Net Promoter Score (NPS).
You know the question, How likely are you to recommend our service to a friend or family member? Ranked on a 0-10 scale and calculated on a net promoter score (responses between 9-10) minus the detractors (responses between 0-6). In a busy world, one simple question that cuts to the bottom line of your customers’ satisfaction with you is very appealing. Also research has shown a fairly decent correlation between the NPS and a company’s ability to grow over time, in many industries.
Additionally, using one simple question standardizes relative scores, at least within industries, to help organizations know just how good their score really is. Plus, NPS can be implemented on an ongoing basis to keep asking the same question over time, helping companies track trends within the organization.
However, NPS is not without its limitations and shortcomings. Possibly the most pertinent of which to the real estate industry and MLSs/associations is the wording of the question itself. In a marketplace where an essential service has no viable alternatives then the “choice” to recommend or not is really not an option. This is the situation most agents find as they enter real estate. If they want to participate as a REALTOR®, then they have to join. Plus, if they have never used another similar service, then how can they recommend one over another?
The other major limitation of the NPS alone is lack of specific feedback. This is a particularly glaring problem when you provide multiple services and products and the customer has several different touch points with you along their journey. Without a breakdown of those services and various touch points, the NPS does not tell you which areas to improve or how to improve them to increase your score in the future.
At WAV Group, we have been helping MLSs and associations measure their success and helping them find the areas to improve. These years of experience of hundreds of surveys has led to the creation of the first Customer Experience Index (CXI) for the real estate industry. Like the NPS, the WAV Group CXI will standardize the process so that you get a simple score that you can compare nationally and over time within your local market. But unlike the NPS, we will score you across seven MLS and association specific KPIs that will give you the depth of feedback to make meaningful improvements.
And just for good measure, we include the NPS in markets where the competitive landscape makes sense. Learn more about the MLS Customer Experience Index from WAV Group.
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