Our client, one of the world’s largest premier hotel chains, aimed to investigate the influence of NPS scores on average customer spending and develop targeted campaigns to increase revenue within specific customer segments.
Overview
Solution
We analyzed NPS data from 2015 to 2017 to understand the relationship between NPS scores and average revenue. The average spending of Promoters, Neutrals, and Detractors was calculated. In 2015, Promoters spent, on average, 26.1% and 35.1% more than Neutrals and Detractors, respectively (Fig 1).
To determine if this spending pattern persisted when NPS categories changed, we tracked the spending of Promoters in 2015 over 2016 and 2017 (Fig 2). The findings revealed that:
- Promoters who remained Promoters in 2016 and 2017 maintained similar spending levels.
- Rewarding customers for referring friends or family via Referral Campaigns proved effective.
- Customers who transitioned to Neutrals in 2016 or 2017 spent 32.01% and 44.63% less, respectively.
- Customers who became Detractors in 2016 and 2017 spent 36.49% and 29.14% less, respectively.
These insights suggested the potential to convert these customers back to Promoters through targeted Win-Back Campaigns.
Output
Based on these insights, the following campaigns were developed:
- Referral campaigns achieved a success rate of 5%, resulting in yearly incremental revenue of x lakhs per visit.
- Win-Back campaigns delivered a success rate of 10% for Neutrals and 3% for Detractors, resulting in yearly savings in lost revenue of y lakhs per visit.
