Whether you're a product manager or a founder chasing growth, you need a reliable metric that not only tracks performance but also signals what needs fixing.
You know the Net Promoter Score (NPS). But they come in pairs: Transactional and Relational.
And no, it's not about choosing one over the other. Both work best together. In this blog, we’ll break down what each metric measures, why they matter, and how to use them to your advantage.
What is tNPS?
Transactional NPS measures customer satisfaction after specific interactions such as customer support, after a video call, using a template, or creating an ad campaign.
The objective is to capture the feedback before customers forget. Here are three things that define tNPS:
- Immediate feedback
- Micro-insights—it measures the granular insights that point towards problem areas and work on fixing them
- Actionable insights—the feedback has quick takeaways leading to faster implementation
Here’s an example: On a scale of 0-10, how would you rate the call with our support agent?
What is rNPS?
Relational NPS or rNPS measures the overall sentiment and loyalty of customers towards a specific brand. While tNPS is limited to an exclusive touchpoint or interaction, rNPS accounts for the experience from start to finish.
Relational NPS is collected at the end of every quarter or bi-annually. It’s measured to assess loyalty perception over a period.
The objective of relational NPS is to have a holistic picture of the likelihood of customers recommending your brand to others. This is inclusive of shortcomings when it comes to transactions.
It is handy to measure the trends over time while combining relational NPS.
What is the difference between tnps and rnps?
While Transactional and relational NPS use the same 10-point scale, some differences make both unique.
When to use tNPS?
Use tNPS for transactions that have a high churn factor such as post-purchase, customer support, onboarding, and product updates.
To put it simply, ask tNPS questions where the frustrations are high. It can be deal breakers that can negatively impact the entire customer experience.
Here are a few examples of how a fintech brand can use transactional NPS:
1. Post-Purchase
Touchpoint: After a customer completes a loan application or investment purchase
tNPS Question: Based on your recent experience with our loan application process, how likely are you to recommend our service to a friend or colleague?
2. Customer Service Interaction
Touchpoint: Following a customer support call regarding account issues
tNPS Question: How likely are you to recommend our brand based on your recent customer support experience?
3. Account Onboarding
Touchpoint: After a new user completes the onboarding process for a mobile banking app.
tNPS Question: "How likely are you to recommend our app to others based on your onboarding experience?"
4. Feature Update
Touchpoint: After a user interacts with a new budgeting tool introduced in the app.
tNPS Question: After using our new budgeting feature, how likely are you to recommend our app to a friend or colleague?
5. Payment Processing
Touchpoint: After a customer completes a payment transaction, especially in industries like fintech where payment security and ease are critical.
tNPS Question: How likely are you to recommend our app to a friend based on your recent payment experience?
6. Account Verification
Touchpoint: Following the completion of an account verification process, such as KYC (Know Your Customer) in FinTech.
tNPS Question: How likely are you to recommend our service based on your account verification experience?
7. Customer Education Sessions
Touchpoint: After attending a webinar or tutorial on using a fintech product effectively.
tNPS Question: How likely are you to recommend us based on the educational session to others based on your experience?
8. Feedback on Regulatory Changes
Touchpoint: After informing customers about changes in regulations that affect their accounts or services.
tNPS Question: How likely are you to recommend us based on how we communicated recent regulatory changes?
When to use rNPS?
Use relational NPS if you deal with high-consideration products or long billing cycles. The idea is to measure the pulse of the relationship and the willingness of customers to recommend the products.
Relational NPS can help you understand how your customers perceive your brand positioning and messaging compared to your competitors. For instance, if you position yourself as AI-powered but your competitors position themselves as a time-saving tool with AI insights.
This means you need to change your messaging entirely.
Second, you’ll be able to get a concrete understanding of the features offering the highest value. This can help you make improvements and enhancements that can increase your retention and engagement.
Finally, relational NPS can help you track loyalty trends and align them with strategic decisions. Specifically, to identify underperforming features and sunset the ones with little to no ROI.
Here are the relational NPS questions that can used in different contexts:
1. Annual Customer Satisfaction Surveys
Example Question: On a scale of 0-10, how likely are you to recommend our services to friends or colleagues based on your overall experience?
2. Quarterly Business Reviews (QBRs)
Example Question: Considering your entire experience with us, how likely are you to recommend our company?
3. Post-Engagement Feedback
Example Question: How likely are you to recommend our services after working with us on your recent project?
4. Customer Loyalty Programs
Example Question: How likely are you to recommend our loyalty program to others based on your experience?
5. Brand Awareness Campaigns
Example Question: How likely are you to recommend our brand after seeing our recent advertising campaign?
6. Community Engagement Events
Example Question: How likely are you to recommend our brand based on your experience at our recent community event?
7. User Experience Research Studies
Example Question: How likely are you to recommend our product based on your participation in our user experience study?
8. Crisis Management Responses
Example Question: How likely are you to continue recommending our brand after our recent handling of [specific issue]?
How to combine both tNPS and rNPS?
Combining your transactional and relational NPS responses helps you correlate both and give the full picture while addressing blind spots.
While we could give the standard steps, an example would be helpful. Here’s a Digital Banking app with its NPS survey campaign.
Transactional NPS Question: How likely are you to recommend us based on your payment experience?
Transactional NPS Score: 85
Relational NPS Question: How likely are you to recommend our app based on your overall experience with our platform?
Relational NPS Score: 64
The fintech app sees a high transactional NPS of 85, indicating users are happy with specific interactions like making payments.
The transactional NPS of 85 depicts happy users who are happy making payments which is the main interaction.
However, the relational NPS of 64 tells that while specific interactions have been positive, users have had a negative experience as well.
This result reveals that while users find the payment process smooth, it isn’t problem-free. Notably, server downtimes and overly stringent security fraud detection mechanisms. Data transmission glitches and payment gateway errors could also be the problems.
The product team should focus on improving these long-term elements to improve relational NPS and overall customer loyalty.
Transactional NPS vs CSAT: What’s the difference?
While transactional NPS and CSAT both measure the experience after specific interactions, they vary in terms of business outcomes and revenue.
CSAT can drive short-term revenue by taking a reactive approach, it can’t measure long-term financial growth and customer lifetime value. It may give referrals but the numbers might be highly minimal.
In contrast, transactional NPS measures the willingness of customers willing to make referrals.
Since this is entirely organic and can be a possible predictor of recurring revenue. It’s an evaluation tool to help investors gauge their profitability and sound financial health. It can help correlate the increase in revenue with market evaluation over time.
Brands that successfully combine transactional NPS and relational NPS
1. Gong
Gong, a revenue intelligence platform runs tNPS surveys after customer success interactions and rNPS to evaluate overall relationship health.
The firm uses these insights to quickly act on feedback, refining sales processes and enhancing customer retention, which aids their growth initiatives.
2. Oura Ring
Oura employs tNPS to assess user satisfaction post-product deliveries or updates and rNPS for broader health-tracking satisfaction.
By merging these insights, the brand offers personalized product updates and customer support experiences to gain loyalty in the competitive wearables market.
Bottomline
While most brands habitually run relational NPS, combining it with transactional NPS can help you gain a deeper understanding of the issues at hand. You can connect the dots between a low relational score and a high transactional score and vice versa.
Not only does it give you context but data to benchmark month on month.
Running transactional or relational NPS surveys is not a problem. Collecting them at the right time and turning them into an action plan is where most businesses fail.
We can help you change that. Start by signing up for a demo. Our product folks will help you in the best possible way.
More resources on NPS
Improve NPS: 8 proven ways to improve NPS score
NPS tracking: What, why, and how (with examples) 2024
NPS question examples: Get better product insights
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