Do You Have Organic Sales Growth?
Do you have organic sales growth? Or is your company faking it? You can examine referring traffic to your website. Companies growing organically tend to have more back page traffic. However, here's another way to find out that will help you do something about it. Survey your customers. Ask them The Net Promoter Question: "Using a scale of 0-10, how likely is it that you would recommend [brand] to a friend or colleague?" Then calculate your Net Promoter Score using Net Promoter methodology.
The average Net Promoter Score (NPS) for consumer brands is 47, retail is 51, and Starbucks is 77. (1) Companies with low NPS scores have fewer customers recommending them, so they must spend more on advertising and promotions to grow sales.
Once you obtain your NPS, look at the distribution of responses to your NPS and find the number of promoters. These are the customers who will drive organic growth. They are desperate for your product or service. Find out why. Can you get more of them?
Then look at the number of passives and detractors. Which group is larger? Conduct one-on-one interviews with both groups to identify the hurdles to becoming a promoter. Identify which group -- passives or detractors -- will be easier to convert. Sometimes both groups can't easily be converted. Then your best bet is to find promoter look-alikes, and market to them instead.
Is it possible to convert passives or detractors and grow organically without completely reinventing your business? Yes. According to a recent McKinsey study of 1175 companies, companies that grow organically usually deploy one of the following strategies: 1. Reallocate funds to high growth activities successful in the past 2. Create new products, services, or business models to capitalize on new opportunities 3. Perform better on core commercial capabilities
The majority focus on one strategy, although about 1/3 use multiple strategies. Most expect to use strategy #2 for future growth.
What are the hurdles to organic growth for your business? Find out. And call me if you need help with this. I've been doing one-on-one research since 1984; using NPS methodology since 2004.