By Laura Lorek
Reporter with Silicon Hills News
That’s the key question behind San Antonio-based Promoter.io, founded by Chad Keck and Ricardo Reyna.
“Our core goal is to help other companies consistently drive new profitable growth,” Keck said.
Promoter.io, a customer analytics and insights platform, helps a company measure its “Net Promoter Score,” a metric for determining customer loyalty. Fred Reichheld, author of The Ultimate Question 2.0, came up with the Net Promoter Score® (also known as NPS), which rates companies on a scale of zero to ten in response to the single question of how likely they are to recommend the company to someone.
Customers who score a nine or ten are a company’s promoters. Those who score between zero to six are known as detractors. A company’s NPS score is the percentage of its promoters minus the percentage of its detractors.
Promoter.io, founded in 2013, recently closed on a $1 million seed stage round and launched into general availability. Its investors include Lew Moorman, Pat Condon, Pat Matthews, all former Rackspace executives, the new Geekdom Fund, John Long, an angel investor, NetDNA and Reichheld, the creator of the Net Promoter System. Its strategic advisors include Rackspace Chairman Graham Weston and AppFog Founder and CEO Lucas Carlson.
“I invested in Promoter for a number of reasons,” said Matthews. “First, I know Chad from our days at Rackspace. He has a really good product sense and good product people make the best entrepreneurs.”
“I also like the partnership he has with Ricardo,” Matthews said. “Building a business is too hard to do alone and they are solid co-founders who are long time friends and complement each other.”
Matthews said he also believes in the Net Promoter concept.
“The Net Promoter Score was the main customer metric we used at both Webmail.us and Rackspace and I think every business in the world can use it to measure and influence customer loyalty,” he said.
Promoter.io helps companies identify and engage their loyal customers to drive organic growth, Keck said. It also gives them meaningful intelligence on why they feel so strong about the brand, he said. Promoter.io also puts companies in touch with their detractors so they can address their needs proactively, he said.
“Not only do we help companies drive growth, we can help them drastically cut churn,” Keck said.
Before launching the company, Keck headed up customer experience at AppFog, which had more than 100,000 developers using the service. He managed the company’s NPS and the experience prompted him to think of the idea for Promoter.io. CenturyLink acquired AppFog in early 2013. That led Keck to join with Reyna to start Promoter.io. Reyna and Andrew Velis, an engineer, moved from San Francisco to join Keck in San Antonio. The company now has five employees and is hiring for several positions.
Promoter.io is the first self-service web platform that takes the Net Promoter System and builds an end-to-end product around it for companies, Keck said.
Based on your NPS you can reliably predict a company’s future growth along with several other bottom-line metrics. Leading Net Promoter companies have also been shown to outgrow their competitors by two or three times, Keck said.
“Promoters are important because they are the most profitable customers themselves,” Keck said. “They stay longer and they spend more money. They are also willing to recommend the product or service to others. They are loyal. When you have a loyal customer and they refer someone else in – it’s like compounded interest. People who are referred to a brand are less price sensitive. They stay longer and they recommend the service to others. It becomes a snowball effect.”
Some people will battle for a brand just because their customer experience was so strong, Keck said. The prime example is Apple, which has customers camped out in front of stores every time they introduce a new version of the iPhone.
Practically every Fortune 1000 company measures NPS, but many small and medium businesses don’t for a multitude of reasons. Promoter.io seeks to bring the NPS concept to the masses, Keck said.
“We want to make this available and affordable to every business,” he said.
So far, Promoter.io customers’ include Rackspace, TeamSnap, ZenPayroll, SmugMug, MaxCDN, Greenling, Groove, LiveChat, Baremetrics, and dozens more.
“What we help companies do has a direct revenue impact,” Keck said.
Measuring and subsequently engaging customers using Promoter.io and the Net Promoter System® will have a measurable return for a company every month, Keck said.
The average score for U.S. companies in 2013 was in the mid to high 20s on a scale from negative 100 to positive 100, Keck said.
“It takes a lot of loyal promoters to offset the detractors,” he said.
Scores up to 50 are good. Scores from 50 to 75 are excellent. Companies scoring above 75 are world-class. USAA has a world-class score along with brands such as Zappos and Nordstrom, Keck said.
“An excellent or world-class score can be hard to achieve, but the focus on taking care of the customer over the long-term will have an extremely beneficial impact on a business,” he said.
TeamSnap started using Promoter.io in mid-2013, said H. Wade Minter, its CTO. Promoter.io has an easy to use interface that has made it simple for the company to integrate Net Promoter Score into its business metrics, he said.”
“I’m quite impressed with it – the dashboard is very clear, the data breakdown is solid, and you can get access to the raw data set in a CSV file for more advanced or specialized analytics,” Minter said. “We’ve seen scores and feedback that let us know what we’re doing well, as well as areas where we’re lacking. We take the NPS results very seriously as a company, and they have provided valuable insight.”
Minter highly recommends Promter.io.
“Ultimately, if your customers are out there singing your praises, you’ll be successful,” he said. “Promoter.io gives us the data we need to understand customer sentiment and act on it.”