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Oct 19, 2021 | 6 Mins read

How to Improve Your NPS with AI-Powered Customer Service

Net Promoter Score, known simply as NPS, is widely considered to be the best way for businesses to measure the customer experience. Developed by Fred Reichheld of Bain & Company in 2003, NPS provides a concise measure of customer loyalty and is a valuable tool for assessing business performance. The score is based on data from a single-question survey.

How is NPS calculated?

Net Promoter Score (NPS) is calculated by asking customers a single question: "On a scale of 0 to 10, how likely are you to recommend our [product/service/company] to a friend or colleague?" Based on their responses, customers are categorized into three groups:

  1. Promoters (score 9-10): These enthusiastic and loyal customers will likely recommend your business.

  2. Passives (score 7-8): These customers are satisfied but less enthusiastic than promoters. They might be open to switching to competitors.

  3. Detractors (score 0-6): Detractors are unhappy customers who are unlikely to recommend your business and may even speak negatively about it.

The NPS is calculated by subtracting the percentage of detractors from the percentage of promoters. The NPS scale ranges from -100 to +100. A high positive score indicates a strong base of promoters and overall customer satisfaction, while a low or negative score highlights areas for improvement in customer experience.

Why is NPS important?

Administering this survey question is a straightforward process. But what’s important is how businesses respond to a low NPS score and the steps they take to improve their operations.

Net Promoter Score (NPS) is crucial for businesses as it measures customer loyalty and satisfaction. NPS provides insights into loyalty levels by categorizing customers into promoters, passives, and detractors. High NPS scores are linked to growth and customer retention. NPS feedback offers actionable insights for improvement while benchmarking guides strategic decisions. It fosters a customer-centric approach, encourages continuous improvement, and helps businesses enhance customer relationships for positive outcomes.

Improving NPS Using AI

Generally, one of the most efficient ways to make simple, lasting improvements on an NPS score is to use artificial intelligence.

AI can help improve NPS in many ways, including:

  1. Proactively reaching out to customers. With any business, common issues result from confusion or just the nature of the product/service. Contacting clients before they even complain can vastly improve the customer experience.

  2. Triaging customer issues. When customers have problems or questions, it can take time for a customer service representative to effectively address them. AI can help you triage and even resolve common customer issues automatically.

  3. Reduce the number of ticket escalations. Escalating support tickets to engineering results in long wait times and tons of effort expended by staff and customers alike. AI can help you leverage product and user context to discover problems and reduce escalations.

  4. Turning Happy Customers into Promoters. Those who responded positively to whether or not they would recommend your services were happy with your service. However, they may not remember to recommend your brand (or may not have an opportunity to do so) for quite a while. Therefore, prompting them to post their thoughts on Twitter, Facebook, or another social media service can result in further advertising and endorsement for your brand.

  5. Sentiment Analysis and Feedback Insights. AI-powered customer service can analyze customer sentiment through natural language processing techniques. By assessing the tone and context of customer interactions, businesses can understand customer satisfaction levels, identify common pain points, and uncover areas for improvement. Leveraging these insights, companies can make data-driven decisions to enhance their products, services, and overall customer experience, ultimately boosting NPS.

Using AI-Powered Live Chat to Improve NPS

Live chat can contribute to enhancing the Net Promoter Score (NPS) in several ways:

  1. Improved customer satisfaction: Live chat provides immediate assistance and allows customers to resolve their issues or get answers to their questions in real-time. The quick response time and personalized support can significantly improve customer satisfaction, leading to higher NPS scores.

  2. Enhanced customer experience: Live chat enables a more interactive and convenient customer experience. Customers can engage in real-time conversations, receive personalized recommendations, and get help with their needs. This level of engagement and tailored support can positively impact the customer experience and, in turn, boost the NPS.

  3. Efficient issue resolution: Live chat enables efficient issue resolution by eliminating the need for customers to navigate complex phone menus or wait for email responses. Agents can provide prompt solutions, guide customers through processes, and address concerns effectively. This streamlined support process reduces customer effort and frustration, increasing the likelihood of positive NPS ratings.

  4. Proactive support and engagement: Live chat platforms often allow agents to proactively engage with website visitors based on their browsing behavior or predefined triggers. Companies can address customer needs by offering proactive assistance before they become problems or frustrations. This proactive approach can give customers a positive impression and improve NPS ratings.

AI can quickly categorize and deal with all of the above issues. At IrisAgent, we have built a proactive customer service platform to help you improve your NPS and keep your customers happy!

Frequently Asked Questions

What is NPS (Net Promoter Score)?

Net Promoter Score (NPS) is a widely used metric in business that assesses customer loyalty and satisfaction. It measures customers' willingness to recommend a company's products or services to others on a scale of 0 to 10. NPS categorizes respondents into three groups: Promoters (score 9-10), Passives (score 7-8), and Detractors (score 0-6). The NPS is calculated by subtracting the percentage of Detractors from the percentage of Promoters.

Why is NPS important for businesses?

NPS is crucial for businesses because it provides a clear and easily understandable way to gauge customer sentiment. High NPS scores indicate satisfied and loyal customers likely to become advocates, driving growth through referrals. Conversely, low scores signal dissatisfaction and the potential for customer churn. By regularly tracking and improving their NPS, businesses can enhance customer experiences, increase customer retention, and ultimately boost revenue and profitability.

How can AI-powered customer service contribute to improving NPS?

AI-powered customer service can significantly improve Net Promoter Scores (NPS) by enhancing various aspects of the customer experience. Through AI-driven chatbots and virtual assistants, businesses can provide immediate and consistent support, reducing response times and increasing customer satisfaction, ultimately leading to higher NPS. AI also excels in data analysis, enabling sentiment analysis to understand customer emotions and identify potential issues that can be addressed proactively. Personalization is another key factor: AI can tailor interactions, recommendations, and content to individual customer preferences, fostering a stronger emotional connection and boosting NPS, as satisfied customers are likelier to promote the brand. Additionally, AI's ability to collect and analyze vast amounts of customer feedback and behavioral data enables businesses to make data-driven improvements that directly impact NPS scores. AI empowers businesses to deliver better, more personalized, and more efficient customer experiences, which drives higher NPS.

What trends can we expect to see in the future of AI-powered customer service and its impact on NPS?

In the future of AI-powered customer service, several trends are likely to shape the landscape and impact Net Promoter Scores (NPS). Firstly, we can anticipate even more advanced AI-driven personalization, where interactions are tailored to individual customer preferences, elevating satisfaction levels. Moreover, AI's predictive capabilities will enable businesses to address customer issues before they become problems, reducing NPS detractors. Ethical AI practices will become increasingly important, as transparency and fairness in AI algorithms will influence customer trust and NPS. Lastly, AI-powered analytics will provide deeper insights into customer behavior, allowing companies to make data-driven improvements directly impacting NPS. Overall, the future of AI in customer service promises more seamless, efficient, and personalized experiences that are likely to drive higher NPS scores for businesses that embrace these innovations.

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