How Important is Customer Satisfaction?

Reading the title of the blog post you might be saying to yourself, "What a silly question, of course, it is important." Perhaps the real question is, how do you know how satisfied your customers really are?If your answer is that "you just know" or"I don't know",perhaps you need to do something to measure it. If you are already asking them and recording it, are you doing it so in a formal method that can be compared to industry standards? This is an important step in order to gain the insight you need to ensure that they are truly satisfied. 


All of this is can be accomplished by using a method called  Net Promoter Score or (NPS)Some good resources that talk in-depth about NPS are found at Wikipedia . The high-level description of a Net Promoter Score is as follows: the higher your score is, the more likely your customers are to recommend (or promote) your company or services to a friend or colleague. A high number indicates a high level of customer satisfaction. There are two very important words in that description, "friend" or "Colleague". This is because people will not recommend anything they do not like to a friend or someone who trusts them. People are much more thoughtful in what they recommend to people who they are close to.  

Here are some other important things to note about NPS and customer satisfaction 

  •   Customers are  4X more likely to buy when they're referred by a friend -- Nielsen
  •   People are 90% more likely to trust and buy from a brand recommended by a friend. -- Nielsen
  •   New referred customers have  16% higher lifetime value.
  •   Sophie Bernazzani writes in the  article  How the Net Promoter Score Helps you Benchmark Customer Loyalty, "The success of referral marketing is a reflection of social proof -- the theory that consumers will adapt their behavior according to what other people are doing. If a person knows your company already has hundreds of happy customers, they'll be more likely to consider purchasing from you." 

While doing this well can be very impactful in improving your business, it is important to do it for the right reasons and not be a slave the achieving that number. The NPS score is a measurement of what you are doing, so focus on customer service and improving customer experience and use your NPS score to track your progress. It is much like standardized tests in school, where you should focus on learning the material not just practicing for the test. 

The NPS score 

The Net Promoter Score is a range of -100 to 100 and is calculated using the following method, and previously mentioned question.How likely they are to recommend your firm to a friend or colleague.The responders use a numeric scale of 0-10, ten being extremely likely and zero being not likely at all. 


Promoters = Those who respond 9-10 

Passives = Those who respond 7-8 

Detractors = Those who respond with 6 or below 


The score is simply subtracting the % of Detractors from  the % of Promoters. This yields a percentage which is your score. The below graphic shows the NPS of some well-known companies. 


 NPS scores 2023


Let's focus on one of those companies above. Ritz Carlton. 


A bestselling book called "The New Gold Standard, 5 Leadership Principles for Creating a Legendary Customer Experience Courtesy of The Ritz-Carlton Hotel Company" talks about how the engender loyalty by instilling outstanding customer service as part of their company. If you ever visit a Ritz Carlton, you know you are going to get great customer service and their NPS score is a 40. 


What about IT Service & Managed Service Providers (MSP)? 

Let's face it,computer support people don't have the best reputation, so much so that Saturday Night Live made a skit about Nick Burns your Company's Computer Guy, showing a rude IT support person who talks down to people and then says "moooove". 


What is the average NPS score of MSPs? Accordingly, to Clearly Rated , the industry average in 2022 for MSP was 42. According to a survey from Datto, the average MSP has an NPS score of 18, which puts MSPs at the bottom of the industry.  

Machine generated alternative text:
Net Promoters: 18 
(Promoters - Detractors) 

 Datto Survey of Net Promoter Scores of MSPs. 


What is wrong with MSPs? 

The truth is that it is difficult to find people that are great at technology and customer service.You want someone who gives you white-glove service and can solve your IT problems, after all, being friendly yet incompetent doesn't help you either.There are very few if any that have both. Luckily there is at least one company that people count on every day to provide great solutions and customer service and, you guessed it, that is iuvo. 



iuvo has an NPS score of 80  

iuvo NPS score 


This is almost 4 times the MSP industry average and better than Ritz Carlton. This did not happen by accident. Companies that have a high NPS score have found customer service technical superstars ingrained in their hiring process and supported and nurtured by their core values and culture. This is exactly our approach. Being this much better than the industry average and up with legendary customer service companies gives our customers the best of both worlds; great technical solutions and world-class customer service. 

If you want to know how to fill your company with Awesome Sauce or want to know more about NPS, reach out, we would love to chat with you. 


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