Investing in Community and NPS to Drive Customer Loyalty - Alison Davidge

Having completed the first day of the conference, it certainly feels that the subject of communities is a growing concept for developing deeper relationships with customers; and a customer community perspective is a perfect partner to a more established loyalty program. Communities and the relationship with NPS were also the focus of the start to Day 2, articulated by a great speaker and veteran of the community concept, Kip Knight from eBay.

Now, you would be forgiven for thinking that eBay see their community solely in terms of their online existence but it was great to hear from Kip that their concept of community goes much deeper and wider. Before looking at this further, let's just refresh on the background of the company.

• Started in 1995, after a year of operations there were 41,000 users on eBay. Today there are over 248 million people active on eBay.
• The vision of the company is to make it possible for practically anyone to sell practically anything in a worldwide marketplace.
• At any one time, there will be 103 million items for sale on the site.
• Over 1.3 million people make a large part or all of their living trading on eBay.

The eBay community itself is defined in terms of including everyone who has a relationship with the company. That really does include everyone --  from buyers and sellers to partners, vendors and associate organisations. This is known as eBay's eco-system and through the online platform and wider community, eBay have developed their strategic differentiation through a unique asset and developed a real tool to promote and develop loyalty and retention.

Perhaps the key driver of the success enjoyed by eBay is the early focus that was placed on a set of values underpinning the business. Those values were outlined as:

• People are basically good.
• Recognise and respect each person as unique individuals.
• Everyone has something to contribute.
• Treat others as you would want to be treated.
• An honest, open environment will bring out the best in people.

As well as developing the online feedback tool, offline eBay has continued to develop the honest, open environment through live discussion events, "eBay In Person" visits, open dialogue and the member advisory group, Voices, who assist with ongoing developments. What eBay has found is that the more a member of the community is involved, the stronger their promoter status. And that involvement should not be limited to the online interaction. 

So how does NPS fit into all of this? Well, first of all Fred Reichheld's Golden Rule is articulated as one of the core values. Secondly, eBay felt that the discipline would be core to developing best practice improvements, increasing competitive awareness, focusing on incremental investments and really enabling a deep-dive understanding of their members loyalty behaviour. The NPS discipline also appealed because it was based on a simple concept metric, it was easy to articulate and it provided a forward looking metric for the business.

Interestingly enough, as with some of my customers, it was not specifically the "Recommend" question that eBay used. After researching and analysing the data, it was found that "Intend to Buy" was a better-correlating metric for their business. They are now moving to "Recommend" as it certainly is relevant to their business and it does allow for more benchmarking comparisons across a wider range of organisations as so many comapnies are using it as a key metric today.

eBay have melded their community and NPS program into a coherent approach to loyalty. It didn't happen overnight and Kip and the team spent time in defining and planning the program (you only get the one opportunity to implement this!), building the foundation and they are now moving into further evaluation and expansion.

Kip's key learnings from the implementation are:

• Know when to centralise and when to delegate
• Never stop learning
• Process is king
• One size does not fit all

And yes, it's not simple in any organisation to implement a loyalty program -- it comes with its own set of unique challenges; but as Kip ably demonstrated -- it's worth it!

Comments

[Stephanie Inge]

I wanted to weigh in on this post and let others know that eBay really is making great strides to get involved with local communities. Thanks to John Donahoe, Griff and the eBay Community Outreach Team are flying to Dallas to attend a regional event on May 29th, hosted by nation's largest eBay seller's Meetup group, The Dallas eBaybes & eMales.