#5 Difference on transactional & relationship NPS
All roads lead to Rome. But, taking the shortest one will help you reach there faster. ?
Likewise, there are several methods of measuring Net Promoter Score. Using the right one will give your business the right pulse about customer and employee loyalty.
NPS is a pretty easy metric to calculate. After all, you have to send just one well-framed question that captures your customer sentiments.
But, when do you send it? Right after the transaction or after a prolonged duration of the relationship with the customer?
Turns out there are two types of NPS that deal with these two different scenarios. They are transactional NPS and relationship NPS.
While both the method help measure the same customer loyalty, there are stark differences in the way they work.
While transactional NPS works perfectly for a specific kind of business, relationship NPS would be a better choice for some others.
Like the road to Rome, choosing either transactional or relationship NPS will make a huge difference in reaching your customer loyalty destination.
Transactional NPS and Relationship NPS
As the name suggests, transactional NPS deals with a specific transaction. It helps identify the customer experience of a particular transaction that concluded recently.
A relationship NPS aims to gauge the customer’s relationship that spans over a period of time. A relationship NPS survey is usually sent after a duration like a week, month, quarter, etc.
Their mode of working itself show that transactional and relationship NPS are way different from each other.
Now, let’s take a deep dive into the many aspects that differentiate transactional and relationship NPS from each other.
1. Timing of the survey
A transactional NPS is sent right after the transaction. There is spontaneity involved which makes it possible for the user to give immediate feedback based on recent experience. It helps gauge the quality of service for a specific segment of customers.
Some examples include:
- An online shopping order completion
- A cab ride review
- Quality of a video call
A relationship NPS, on the other hand, is sent periodically — like weekly, monthly, yearly, etc. The prolonged period in sending the survey gives the customer enough time to create thoughtful feedback about the relationship with the business.
Some examples include:
- Membership with a holiday club
- Quality of service of an online subscription
- A gym membership
2. Touchpoints with customers
Transactional NPS are sent dynamically to users. They could be sent through an in-app push notification,
An SMS carrying a link to give the feedback, a pop-up on the browser window and so on. They are triggered as and when the transaction is completed.
Relationship NPS surveys are pre-planned. They are scheduled to be sent to users after a definite period of time. The survey is sent through a channel through which the customer can be best reached.
For example, in-app notifications would be the right choice for mobile app users, while emails would be the right choice for online users.
An NPS survey tool helps with planning, scheduling and sending the Net promoter Score Software survey to a segmented user base.
3. Type of survey findings or feedback
Transactional NPS aims to fetch feedback that is immediate. It helps a business understand what customers feel about a product feature or service right after using it.
In a way, it helps measure the effectiveness of new feature rollouts, change in workflows, change in pricing, etc.
Example: A hotel chain asking its customers how the online booking experience was.
Whereas relationship NPS surveys aim to measure the overall satisfaction that the user has derived from using the product or service for a prolonged period of time.
Example: a hotel chain can ask its guests how the stay experience has been for the past three stays.
4. The objective of the survey
Improve customer engagement vs gauge customer loyalty
NPS surveys aim to measure customer loyalty. But, transactional and relationship NPS surveys do that at varying levels.
If you look deeper, transactional NPS surveys seek to find the factors that influence customer engagement.
It asks whether the customer was comfortable using a feature, the product or the service. Were there any roadblocks in the transaction that should be rectified?
Or, whether there are any recommendations that the customers think need improvement also learn How to improve net promoter score
Relationship NPS surveys go beyond that and see if all the cumulative experiences will persuade the customer to refer the business to their friends and relatives.
Its objective is to gauge customer loyalty that stems from the previous transactions that the customer has had with the business.
5. Benefits accrued from the survey
What does a business gain from collecting feedback from customers after every single transaction? Well, turns out a lot more. At the onset, it helps shed light on the processes or steps that customers find to be redundant or lagging.
Transactional NPS survey helps hear from customers the kind of process changes they expect to see in the product or service.
Relationship NPS surveys, on the other hand, aim to figure out passive customers who could be converted into promoters. They look at customer relationships from a bird’s eye view and helps make long-term changes that will boost customer loyalty.
Transactional or Relationship — which one should you go or?
Transactional and relationship NPS surveys serve their own purposes. If your business is keen on winning customer loyalty, you must use both of these strategically, and also if you know how to calculate net promoter score it will be a PLUS!
Special attention should be paid to the questions used for each transactional and relationship surveys must be well-crafted so that they invoke the right responses from customers.