Hackernoon logoWhich Is Better For Your Business: Relationship or Transactional NPS® Surveys? by@zonkafeedback

Which Is Better For Your Business: Relationship or Transactional NPS® Surveys?

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Being the most popular metric commonly used to measure Customer Experience, the NPS® Surveys are mainly aimed to not only gauge Customer Loyalty, but to also improve the Customer Experience by getting real customer insights and their views and perceptions about your business. Although it is based on the Ultimate Question: asking the likeliness of the customers to recommend a brand, and yet its versatility lets you conduct the surveys the way you feel is most suitable for your business.

Whether you send your Surveys periodically or specifically after a customer deal, NPS® Surveys are capable of finding Customer Loyalty and predicting the upcoming business growth. Here the question arising which confuses most of the business professions is which type of NPS® Surveys to be used. What will be more profitable to the business, a Transactional NPS® Survey or a Relation NPS® Survey?

If you are also into this dilemma of choosing the best among the two, we will help you with the information regarding both of them that can help you make this decision better for your business.

We will cover what they are, how they are different from each other, and in what instances they prove to be helpful for your business. By the end, you should have a better understanding of both of them and be able to decide the most suitable one as per the nature of your business. Let’s start with what they are all about.

What are Transaction NPS® Surveys?

Transactional NPS® Surveys are those NPS® Surveys that are conducted to understand the customer insights related to a particular transaction or an event. It may be a purchase of a product or a service, an onboarding completion of a subscription, a bill payment, a delivery, a dining experience or anything that involves a particular event.

The survey asks the same Ultimate Question from the NPS® Survey but in a different way. 

“Based on the most recent experience (delivery/ purchase/ transaction/ interaction), how likely are you to recommend us to your friends and colleagues on a scale of 0 to 10?”

(10 being ‘Most likely’ and 0 being ‘Not at all Likely’)

It is a fact that Customer Loyalty can change with a single experience. Transactional NPS® Survey tracks these changes and helps you work on real to improve Customer Experience before it's too late.

What are Relationship NPS® Surveys?

Relationship NPS® Surveys are those that help to maintain the relationship with the customers and track Customer Loyalty from time to time. These are periodic surveys sent at regular intervals of time to track customer relationships. They can be sent as monthly surveys, quarterly surveys, half-yearly surveys or annual surveys in order to gauge Customer Loyalty from time to time.

A Relationship NPS® Survey isn’t sent on any specific event or transaction. Rather, it focuses on measuring the overall Customer Satisfaction with the Customer Experience generated with a sum of multiple transactions or events. It helps to ensure that customers are still with you and their relationship with the brand is healthy.

How are they different from each other?

Let us learn more about the key differences between Relationship and Transactional NPS Surveys.

  1. Purpose
  2. Timing
  3. Touchpoints in Customer Journey
  4. Perspective
  5. Findings of the Surveys

Let’s learn how these aspects make both types of surveys different.

1. Purpose

Although, both Transactional and Relationship NPS® Surveys aim to measure Customer Loyalty, however, their purpose differs in the way they do this.

If you dig deeper, you can find that the purpose of a Transactional NPS® Survey is to find out the factors determining Customer Experience which in turn affects Customer Loyalty. These surveys are very helpful in finding the strengths and weaknesses of the businesses that eventually help in making the right business decisions for your business.

Whereas, when we talk about Relationship NPS® Surveys, their main purpose is to track and continue the ongoing relationship with the customers. Relationship NPS® Surveys do not focus on one particular experience, rather, it has a broader horizon to find the Customer Loyalty based on the collective experience which is a sum of multiple transactions of the customers over a considerable period of time.

2. Timing

Transactional NPS® Surveys are not regular in nature. They are triggered with the occurrence of a particular transaction or an event like a purchase of a product or a service, a bill payment, a renewal of membership, onboarding, an installation, a complaint resolution, a visit, a stay, a dine or basically anything at any touchpoint of the customer journey.

Whereas, Relationship NPS® Surveys are sent at regular intervals. They may be sent as annual surveys, half-yearly surveys, quarterly surveys, monthly surveys or even weekly surveys.

3. Touchpoints in the Customer Journey

The Transactional NPS® Surveys can be sent at any touchpoint just after moving a step in the customer journey be it a visit, onboarding, a purchase, a renewal, a bill payment, an issue resolution or a customer interaction at any point.

Whereas the Relationship NPS® Surveys are sent in between the customer journey after completion of a course of time decided.

4. Perspective

The Transactional NPS® Surveys cover the customers’ perspective just after a particular transaction. It is helpful in covering any change in the views and perceptions of the customers due to a particular reason or experience. 

Whereas, the Relationship NPS® Surveys covers the overall perspective of the customers about your brand or organization and its ability to satisfy the customers.

Some Pros and Cons of Transactions NPS® Survey

Pros:

1. It helps to gauge changes in Customers’ views - The views of the customers change with every experience. Transactional NPS Surveys are helpful to track these changes in the views and perception of the customers. 

2. It helps to evaluate a business decision - Transaction NPS Survey is a powerful tool to evaluate a business decision. For instance, you have introduced a new feature in your product or service. You can send an NPS survey at this point to gather feedback about that particular feature.

3. It helps to improve Customer Experience immediately - One of the biggest advantages of the Transaction NPS Survey is that it captures real-time feedback. This enables you to work on the most recent experience of the customer especially when in case of a negative experience, you can take necessary actions to improve the Customer Experience before it gets too late.


Cons:

1. It has a shorter horizon - Transactional NPS Survey does not gauge overall Customer Experience, rather it has a short horizon covering one aspect of experience in a particular survey, unlike Relationship NPS Surveys.

2. It doesn’t cover the customers that haven’t made a transaction for long - Transactions NPS Surveys are triggered with a transaction. But there may be customers who haven’t done any transaction for long say six months or maybe a year. These surveys cannot help to reach them and take feedback from them and gauge their loyalty.

3. Doesn’t give data for benchmarking - NPS Surveys are generally beneficial in setting benchmarks against your competitors in the industry. But this is not the case with Transactional NPS surveys. You cannot use transactional NPS where you want to showcase or compare the annual or quarterly NPS of your company.

Some Pros and Cons of Relationship NPS® Survey


Pros:

1. It helps to track and maintain relationships with the customers - This is the biggest advantage of the Relationship NPS Surveys. It helps to track whether you are able to improve the customer relationships or not. You can segment your customers into groups and see whether the NPS of the various segments is improving or deteriorating. If it is the latter, you can look into it through the feedback provided by the customers and work on it to improve your Net Promoter Score.

2. It tracks the overall Customer Loyalty over time - Relationship NPS Surveys enable comparative analysis of Customer Loyalty between different time intervals like the previous year and current year or quarter. You can do this by easily comparing your Net Promoter Score with the previous one or with the industry standards to do a comparative analysis.

3. It covers all the customers - Relationship NPS Survey covers all the customers to be approached on a periodic basis. It involves reaching even those customers who have not made any purchase for months or more than a year. This helps to develop and save customer relationships even with those customers who were thinking to switch to another brand. These surveys give them the opportunity to convey their feelings and get an improved experience. 


Cons:

1. Not effective in immediately preventing customer churn - According to Esteban Kolsky, only 1 in 26 unhappy customers actually complain, the rest of them simply churn. And in Relationship NPS Surveys, you are not always able to ask the feedback at the right time. It may be possible that before you conduct your periodic surveys, some customers would have churned due to a particular experience which you didn’t track and it’s hard to bring back those miffed customers.

2. Lower Response rate - When the customers have recently done a transaction, their experience is fresh and they are in a better position to share feedback. But in the case of Relationship NPS Surveys, customers are not always willing to take a survey thus reducing the response rate of these surveys.

Which one is the Best?

Whether it is a Relationship NPS Survey or a Transactional NPS Survey, both aim to gauge Customer Loyalty. However, both have their own pros and cons as discussed above. When making a decision to choose the right one among them, you need to consider the nature of your business and the trends of your industry in order to choose the best-suited survey type for your business.

In our view, a combination of both surveys should be used. You can take half-yearly or quarterly Relationship NPS Surveys and set triggers for Relationship NPS Surveys to be sent just after a full transaction completes.

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