A key characteristic that differentiates your accounting firm from your competitors is the way you treat and serve your clients. Happy clients are much more likely to stay with your practice long-term, and they’re also likely to provide you with referrals—one of your best methods of client acquisition. This makes knowing the satisfaction of your clients pivotal if you have ambitions to grow.
While there is no single metric that will tell you everything you need to know when it comes to client satisfaction, the Net Promoter Score (NPS) is your best place to start. This is a tool that measures the experience your clients have with your practice to predict your firm’s potential for growth. And this is all measured by asking your clients one simple question: Share on TwitterShare on facebookHow likely are you to recommend our accounting practice to a friend or colleague?
This question goes beyond just a client’s satisfaction, it learns what action they would take based on their experience with your practice. Many companies across various industries including Intuit, Apple and Tesla use NPS to improve their profitability, and it’s becoming increasingly adopted amongst accounting firms.
These are the steps you can follow to use NPS in your accounting practice.
Begin by identifying clients to answer the question, "How likely is it that you would recommend our company to a friend or colleague?” on a scale of 0-10. You should also ask for a reason behind why the give you the rating.
As for when to ask, you have several options, each with their own advantages:
End of a project or deliverable: the most logical place to start because your client has had a chance to see your work from start to finish. For the client, it will also feel like an appropriate time to give feedback.
End of a client call, resolution or office visit: in a follow-up email include a link and ask if they would mind filling out a short 1-2 question survey.
Beginning of a formal client relationship: this will measure client satisfaction at a relationship starting point to compare to further on. It will also tell you how your team performs at the prospecting, sales, or onboarding phase.
End of a client relationship: in the unfortunate event of a bad situation at the end of a client relationship, you should make an effort to ask for feedback. If a client isn’t happy, you need to know why so you can fix any issues for future clients. Don’t dodge feedback even if you expect it to be negative.
After tax season: the end of a busy period is an excellent time to send out a survey to your clients to ask how satisfied they were with you during the tax year.
NPS scores work by placing your clients into one of three categories based on the feedback they provide you.
Promoters (scores 9 – 10):
loyal and enthusiastic clients who will keep using your services and refer others
Passives (scores 7 – 8):
satisfied but unenthusiastic clients who are at risk of moving to a competitor
Detractors (score 0 – 6):
unhappy clients who can damage your brand and impede your growth with negative word of mouth
You'll notice that this scale is weighted more towards the detractors. This is so that you can discover who was really wowed by your service, who was dissatisfied, and who was somewhere in the middle.
Net Promoter Score = % promoters – % detractors
You can determine your NPS by calculating the difference between the percentage of promoters and detractors as an absolute number. You could end up with a score anywhere between 100 and -100. For example, if your practice has 50% promoters, 40% passives, and 10% detractors, your NPS is +40.
Any positive NPS is what you should be aiming for at a minimum, and the higher the better. Globally, the best performing accounting practices are achieving NPS scores of 40 or more.
Once you have your NPS, you need to consider why you have that score. What drove your client to give you that rating? This is where each client's individual reason for their score is worth analyzing.
Look for common themes across promoters, passives, and detractors, and determine areas of your practice that you can improve in. Use your gathered information to determine where changes should be made, and always be aiming to improve your NPS.
Measuring your NPS is an ongoing process. Make it part of your firm’s regular work to approach clients to answer your question and provide feedback. Be aware of any changes made to your firm and be on the lookout for how they affect your score, along with any other dramatic changes—good or bad—to your NPS.
Customer satisfaction is crucial to the growth of your practice, and your NPS is the best way to tell you what experience you are giving your clients. This makes it one of the essential metrics you should be tracking for your accounting firm.
With this knowledge, you can make educated strategic decisions and calculated changes that will improve the service you provide to your clients and the strength of your firm.
Karbon's new approach to practice management makes it easy to keep your clients happy. To find out how Karbon can help you collaborate more efficiently with your clients and stay on top of every relationship, register for a live intro webinar.