The customer is not always right but the customer is always the customer. Today, more than ever, this is important to remember. We live in a connected world where clients can provide immediate feedback, whether directly through a customer survey or, indirectly on a platform such as Yelp. We’ve all received a follow-up email containing or pop up box with survey questions about our experience with a product or service. While it may be seen as annoying, it is important to the customer and to the business. The legal services industry is no different. In fact, it’s vitally important to receive feedback on the attorney service and company’s products, including the innovation presented in my previous post. It is impossible to improve on a service without feedback. Net promoter score (NPS) is a simple and powerful evaluation tool for law firms, group legal services providers, and companies.
A 2016 Thomson Reuters’ survey of small law firms reported that client satisfaction is the most important indicator of success. However, the majority of firms surveyed do not collect feedback from their customers. It seems there is a disconnect. The legal industry can benefit from the work done in 2003 by Fred Reichheld, Bain & Company, and Satmetrix Systems to develop NPS as a customer loyalty metric.
I can share LegalShield’s NPS program to illustrate how the program and scoring works. The metric is calculated based on the ratings on the scale of zero to ten for the simple question:
How likely is it that you would recommend LegalShield to a friend or colleague?
We use the same approach to ask a second question (and a third if a referral firm is also involved):
How likely is it that you would recommend your provider law firm <insert name> to a colleague or friend?
Selecting a zero means that the customer is not at all likely to recommend and a 10 is when they are extremely likely to recommend the law firm. The NPS calculation is best explained with an example. If you collect 100 scores as follows, first ignore the neutrals and next, subtract the detractors from the promoters:
Promoters (9 or 10): 70 70
Neutrals (7 or 8): 6 –
Detractors (0 to 6): 24 24
The 70 promoters less the 24 detractors, would give a NPS of 46 in this example. So, what does the NPS score really mean? Obviously the higher the better; but the NPS is often used as a benchmark against competitors or the industry as a whole. However, like many other metrics, the meaning depends on your company or firm’s definition of success.
The second component of the NPS questions generally includes follow-up queries to pinpoint the reasons behind the initial rating. For example, for those customers who rate their provider firm between zero and six would be asked to score, again on the zero to ten scale, the level of satisfaction with the attorneys’ listening skills, communication, professionalism, knowledge, and more.
One of our provider attorneys, Ben Farrow, of the The Anderson Law Firm, commented on NPS and client satisfaction:
The law is a relationship business and as such the client’s perception of how you handled their matter is king. Word of mouth and reputation are worth more than the cost of all the billboards, television commercials and magazine advertisements combined. But how do you know you are getting “good” word of mouth? What half of my advertising dollar is working? With NPS, the firm has an easy to use tool that answers the “How’d I do?” question. It takes the client less than a minute to provide me honest feedback and lets me know, in near real time, when my clients have a concern before it becomes a problem. I am able to address the concern, protect my reputation and become more responsive to my client’s wants and needs. This, in turn, engenders customer satisfaction and loyalty. In short, NPS lets me measure, evaluate and build customer loyalty, accurately, quickly and easily.
We have gathered the NPS information for over five years at LegalShield, since March 2012. However, NPS is just one key performance indicator and therefore, gathering the data and calculating the score is just the beginning. If you have asked qualitative or attribute follow-up questions, that information will inform your business or firm of potential changes or internal actions to be taken. You may wish to resurvey the clients who are still engaged and were previously detractors and neutrals to check for improvements. The final installment in this now four-part series will examine these follow-up actions for NPS. For part one of Navigating Group Legal Services with Technology click here.