HOW CAN YOU PREDICT FUTURE SUCCESS IN YOUR REAL ESTATE BUSINESS?
Grant Schneider always has great advice and I really enjoyed this post of his, so I wanted to reblog it for more people to see!
If you have had been doing great in your real estate group in the past that alone does not guarantee that it will continue in the future. To quote investment company advertisements, “past performance is no guarantee of future results.” You need to have a leading indicator. A leading indicator would show current business conditions which would lead to continued success. Two very important measurements are team engagement and customer loyalty. While sales and profits are very important measurements, they tell you what has happened. Team engagement and customer loyalty tells you what will happen.
When you have engaged members of the team they will do their best work which will result in loyal customers. You should measure this team engagement at least once per year. The ultimate question is, “How likely are you to recommend our group as a great place to work?” When you have highly engaged team members you have promoters of your workplace. A measurement called The Net Promoter Score (NPS) has been developed to measure this.
When you exceed the customer's expectations and create an emotional bond with your customer they too become your promoter. They will recommend your group or your team to friends. According Fred Reichheld, pioneer in customer loyalty, the most important question is, "How likely are you to recommend our product or service to a friend?"
Fred Reichheld's 2006 book, The Ultimate Question, challenged the conventional wisdom of customer satisfaction programs. It coined the terms bad profits and good profits and pointed to a faster, much more effective way of gauging customers' real loyalty to a company, introducing the quantitative measure (The Net Promoter Score) for establishing a baseline and effectively tracking changes in customer loyalty. This is true also of team member engagement or team member loyalty.
NPS is based on the fundamental perspective that every company's customers can be divided into three categories: Promoters, Passives, and Detractors. By asking one simple question - How likely is it that you would recommend [Company X] to a friend or colleague? - Reichheld states that you can track these groups and get a clear measure of your company's performance through its customers' eyes. Customers respond on a 0-to-10 point rating scale and are categorized as follows:
- Promoters (score 9-10) are loyal enthusiasts who will keep buying and refer others, fueling growth.
- Passives (score 7-8) are satisfied but unenthusiastic customers who are vulnerable to competitive offerings.
- Detractors (score 0-6) are unhappy customers who can damage your brand and impede growth through negative word-of-mouth.
To calculate your group's Net Promoter Score (NPS), take the percentage of customers who are Promoters and subtract the percentage who are Detractors.
Make sure you do not only react to customers who complain. Depending on the size of your business set up some type of system to measure the opinions of the buyers of your products or services. You can do this anonymously but give a customer the option of identifying themselves to management. Then call that customer immediately and ask that customer what you need to do to exceed their expectations. By listening to your customers and employees and acting in their favor you should be building the most important metric—team engagement and customer loyalty. If these metrics are rising, then rising sales and profits will follow. For a similar post on our web site see USE THIS LEADING MEASUREMENT TO IMPROVE YOUR SALES AND PROFITS.
We can help you use the Net Promoter Score to improve customer loyalty and employee engagement.
or call 914-953-4458.
Business Coach - Strategic Plans - Sales and Marketing Coach
Grant Schneider - Leadership and Business Coach Creating Successful Business Outcomes
President Performance Development Strategies
- Business Performance and Strategic Business Plans
- Organizational Effectiveness
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914-953-4458, Armonk NY 10504 grant@pdstrategies.com
Visit my website www.pdstrategies.com for information on how you can obtain quantum leaps in your business performance.
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