#Zomato Net Profit Falls

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Zomato Net Profit Falls 57%: Is the Food Tech Giant in Trouble?

Zomato Net Profit Falls, Deepinder Goyal, a multimillionaire, has had a difficult start to 2025. Zomato, his food tech unicorn, recently revealed a startling 57.2% decline in consolidated net profit for the December quarter. To find out what caused this significant drop and what it implies for the business and its stakeholders, let’s examine the specifics. The Data That Illustrate the Story For…

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Blinkit Franchise Cost: Unlocking Opportunities in Quick Commerce

With digital convenience becoming a way of life, India’s quick commerce sector is growing at lightning speed—and Blinkit is leading the charge. Delivering groceries and essentials in under 15 minutes, Blinkit has built a loyal customer base across metro cities. For those eyeing a tech-enabled business with strong returns, understanding the Blinkit franchise cost and operational model is the first step toward becoming a Blinkit partner.

What Makes Blinkit’s Model Unique?

Blinkit operates using “dark stores,” which are micro-warehouses designed to serve hyperlocal orders. These facilities are not open to walk-in customers but are optimized for stocking, picking, packing, and dispatching online orders placed via the Blinkit app.

Unlike traditional franchises, Blinkit doesn’t sell store branding for a fee. Instead, it forms strategic partnerships with local entrepreneurs who manage these dark stores while Blinkit handles order generation, technology, and delivery logistics. This hybrid model makes it easier for partners to focus on inventory and operations without worrying about marketing or customer acquisition.

What is the Blinkit Franchise Cost?

Though Blinkit calls its partners “store owners,” the setup resembles a franchise in its investment structure and revenue-sharing format. The Blinkit franchise cost depends on various factors such as store location, inventory size, and operational readiness. A typical cost breakdown includes:

Store Setup Costs: ₹8–₹10 lakh for racks, furniture, lighting, weighing machines, CCTV, and internet.

Product Inventory: ₹5–₹8 lakh for groceries, personal care, beverages, snacks, and home essentials.

Rent and Lease: ₹30,000 to ₹1 lakh/month depending on property size and city.

Operational Expenses: ₹1–₹1.5 lakh/month for staff wages and utility bills.

Licensing and Tech Setup: Around ₹50,000–₹1 lakh for GST, FSSAI, trade licenses, and tech integration.

The total Blinkit franchise cost usually falls in the ₹15 lakh to ₹25 lakh range.

Revenue Potential and Profit Margin

One of the reasons Blinkit is so appealing is its predictable demand flow. A well-placed Blinkit dark store can serve 4,000 to 6,000 orders monthly, with average order values between ₹250 and ₹300. Partners typically earn gross margins of 8–12% per order.

After deducting rent, salaries, and miscellaneous costs, the net profit can range from ₹1.5 lakh to ₹3 lakh per month. Most partners are able to recover their initial investment in 12 to 18 months—making it a smart medium-risk, high-return business.

Why Choose the Blinkit Franchise Route?

Fast-Growing Market: Quick commerce is exploding in India.

Established Brand Trust: Customers already recognize and use Blinkit daily.

Tech-Driven Operations: Blinkit provides real-time software, dashboards, and analytics tools.

Zomato Ownership: Offers long-term financial and strategic backing.

Conclusion

The Blinkit franchise cost reflects a reasonable investment for entrepreneurs seeking to enter the booming quick-commerce space. With an efficient business model, consistent customer demand, and strong brand support, partnering with Blinkit can lead to significant and sustainable income in a short span of time.

[stockmarketanalysis]

The Ultimate Guide to Hedge Funds: How They Work & How to Invest

Hedge funds have long been considered an elite investment option, often associated with billionaires, institutional investors, and Wall Street giants. But how do they actually work? Are they worth investing in? And how can an Indian investor get started with hedge funds?

In this comprehensive guide, we’ll cover: ✅ What hedge funds are and how they operate ✅ Different hedge fund strategies that generate returns ✅ How hedge funds compare to mutual funds and private equity ✅ Risks, regulations, and famous hedge fund failures ✅ How to invest in hedge funds in India ✅ The future of hedge funds, including AI-driven strategies

1��⃣ What Are Hedge Funds & How Do They Work?

A hedge fund is a pooled investment fund that uses aggressive strategies like leverage, derivatives, and short-selling to generate high returns. Unlike mutual funds, hedge funds are exclusive to high-net-worth individuals (HNWIs) and institutional investors.

🔹 Structure of a Hedge Fund

Hedge funds typically operate as Limited Partnerships (LPs):

General Partner (GP): The hedge fund manager who makes investment decisions.

Limited Partners (LPs): Investors who provide the capital but have limited liability.

🔹 Fee Structure: The "2 and 20" Model

Most hedge funds charge: ✔ 2% annual management fee (on total assets) ✔ 20% performance fee (on profits generated)

For example, if a hedge fund manages ₹1,000 crore and earns a 10% return (₹100 crore), it collects ₹2 crore as a management fee and ₹20 crore as a performance fee.

2️⃣ How Hedge Funds Make Money: Popular Investment Strategies

Unlike traditional mutual funds, hedge funds use aggressive and complex strategies to maximize returns.

🔹 1. Long-Short Equity

The fund buys (long) undervalued stocks and short-sells overvalued stocks to make money in both rising and falling markets.

📌 Example: If a hedge fund in India expects Reliance Industries to rise and Zomato to fall, it may buy Reliance shares and short Zomato.

🔹 2. Global Macro Strategy

This strategy bets on economic trends, interest rates, and currencies across the globe.

📌 Example: A hedge fund may invest in the U.S. dollar against the Indian rupee if it expects the rupee to weaken.

🔹 3. Arbitrage Strategies

Merger Arbitrage: Betting on the success or failure of corporate mergers.

Statistical Arbitrage: Using quantitative models to find price inefficiencies.

📌 Example: If Tata Group announces a merger, a hedge fund may buy shares of the smaller company expecting a price jump.

🔹 4. Event-Driven Investing

Investing based on corporate events like earnings reports, bankruptcies, and acquisitions.

📌 Example: A hedge fund could invest in Yes Bank when it faced restructuring, betting on a recovery.

🔹 5. Quantitative & Algorithmic Trading

Funds use AI, machine learning, and complex algorithms to execute thousands of trades within seconds.

📌 Example: Renaissance Technologies and Two Sigma are famous quant-driven hedge funds.

🔹 6. Cryptocurrency & DeFi Hedge Funds

With the rise of Bitcoin, Ethereum, and decentralized finance (DeFi), hedge funds are now investing in digital assets.

📌 Example: Indian hedge funds like Mudrex offer crypto-based investment strategies.

3️⃣ Hedge Funds vs. Mutual Funds & Private Equity: Which Is Better?

📌 Key Takeaway: Hedge funds are riskier but offer higher potential returns compared to mutual funds and private equity.

4️⃣ Hedge Fund Risks: Are They Worth It?

Hedge funds promise high returns, but they also come with significant risks.

🔹 Market Volatility

Hedge funds are exposed to market downturns, especially when using leverage.

📌 Example: The 2008 Financial Crisis wiped out several hedge funds due to high leverage.

🔹 Liquidity Risk

Investors often face lock-in periods before they can withdraw funds.

📌 Example: During the 2019 IL&FS crisis in India, many hedge funds struggled to exit their positions.

🔹 High Fees

The 2 and 20 model means hedge funds make money even when they lose investors’ money.

🔹 Regulatory Scrutiny

Governments worldwide are tightening regulations on hedge funds due to financial risks.

📌 Example: Archegos Capital (2021) collapsed due to excessive leverage, causing banks to lose billions.

5️⃣ Hedge Fund Regulations in India

Hedge funds in India fall under Alternative Investment Funds (AIFs) – Category III, regulated by SEBI (Securities and Exchange Board of India).

🔹 Only accredited investors can invest (minimum ₹1 crore investment). 🔹 Hedge funds must register with SEBI and follow strict disclosure norms. 🔹 Popular Indian hedge funds include Nine Rivers Capital, Avendus Capital, and Unifi Capital.

6️⃣ How to Invest in a Hedge Fund in India?

Step 1: Check Eligibility

✔ Must be an accredited investor with a minimum investment of ₹1 crore.

Step 2: Find a Hedge Fund

✔ Research funds using platforms like Preqin, Hedge Fund Research (HFR), and SEBI’s AIF database.

Step 3: Analyze the Performance

✔ Look at the Sharpe ratio, Alpha, and Beta to assess risk-adjusted returns.

Step 4: Understand the Fee Structure

✔ Ensure the hedge fund’s 2 and 20 model aligns with your financial goals.

7️⃣ How to Start Your Own Hedge Fund in India?

Step 1: Register with SEBI

✔ Apply as a Category III Alternative Investment Fund (AIF).

Step 2: Raise Capital

✔ Hedge funds require a minimum ₹20 crore corpus to launch.

Step 3: Choose a Fund Structure

✔ Offshore hedge funds often set up in Cayman Islands or Mauritius for tax benefits.

Step 4: Select a Prime Broker & Administrator

✔ Work with financial giants like Goldman Sachs, JP Morgan, or Kotak Securities.

8️⃣ The Future of Hedge Funds: AI, ESG & Crypto Trends

📌 AI & Algorithmic Trading:

Hedge funds are adopting AI-driven models for high-frequency trading.

Tools like Strike.Money help traders analyze hedge fund strategies.

📌 ESG Hedge Funds:

Funds investing in environmentally and socially responsible companies.

📌 Crypto & DeFi Hedge Funds:

Hedge funds investing in Bitcoin, Ethereum, and decentralized finance projects.

📌 Example: Hedge funds like AQR Capital are integrating machine learning into their investment models.

📌 Final Thoughts: Should You Invest in Hedge Funds?

✔ If you’re a high-net-worth investor seeking aggressive returns, hedge funds can be a good option. ✔ However, hedge funds come with high fees, low liquidity, and regulatory risks. ✔ Always conduct due diligence before investing and use tools like Strike.Money for better market insights.

Would you invest in a hedge fund? Let us know in the comments! 🚀

[1stnewslink]

sensex today: Stock Market LIVE Updates: Retail investors make beeline for Zomato IPO. IT stocks in high demand. Profit booking in realty stocks. Mindtree jumps 8%. Wipro 4%

Domestic stock benchmarks started Wednesday’s session on a flat note amid selling pressure in private bank stocks. Tech Mahindra was the top Nifty50 early deal winner, up 0.70 percent. L&T, Adani Ports, Wipro, and HCL Tech were among the other blue-chip top performers. On the other hand, ICICI Bank was the biggest straggler, down 0.65 percent. Other losers include UltraTech Cement, HDFC Bank, Axis Bank and Eicher Motor. Just Dial gained 4 percent while Quess Corp lost 3 percent in early trading.

!1 new updateClick here for the latest updates

WPI inflation falls to 12.07 percent in June; Food, crude oil prices are softening

IT stocks are leading the rally. Here are the top winners

Price as of 07/14/2021 12:17 pm, Click on company names to see their live prices.

Stock screener

Search, select and invest in top stocks

Mindtree shares 52-week high after Q1 earnings

Mindtree stocks rose over 9 percent on Wednesday after the IT company posted consolidated net income up 61.2 percent for the June quarter and expressed confidence in double-digit revenue growth in FY22.

Zomato IPO retail quota fully subscribed

Tata Metaliks stock is up over 8% over June quarter earnings

Tata Metaliks Ltd shares rose over 8 percent on Wednesday after the company reported net income of Rs 94.72 billion for the quarter ended June 30, 2021. After getting off to a firm start, the stock rose 8.06 percent to 1,299 rupees for the BSE.

Candle screener

Discover and examine trading opportunities

Zomato IPO so far subscribed 16% on the first day

The rupee drops 12 paises in early trading to reach 74.61 against the US dollar

The Indian rupee lost 12 paises to 74.61 against the US dollar in opening trading on Wednesday as the strong US currency and weak domestic stocks weighed on investor sentiment.

Info Edge adds 1% to Zomato’s IPO

Info Edge’s shares rose over 1 percent in trading Wednesday as Zomato launched its initial public offering of Rs 9,375 billion. The Zomato issue includes an offer to sell from Info Edge, India, valued at Rs 375 crore, which owns 18.55 percent of the online grocery delivery and restaurant discovery platform.

NMDC shares up 2% after co-board approves the demerger of NMDC Steel

The state-run NMDC said Tuesday that its board of directors had approved the demerger of NMDC Steel Limited. In a BSE filing, NMDC said that NMDC Steel is its wholly owned subsidiary, which is not currently doing business.

We continue to believe that any significant correction in the market should be used as an opportunity to get into quality stocks

– Binod Modi, Head – Strategy, Trust Title

Bank stocks trade lower

Price as of 07/14/2021 10:05 a.m., Click on company names to see their live prices.

Nifty appears to be consolidating in the 15,600–15,900 range: analysts

Top winners and losers in the broader market

Happiest Minds, Just Dial, Vakrangee, Mindtree, Mphasis and Coforge were winners in the field, while Quess Corps, Shilpa Medicare, Edelweiss Financials, Max Financial, Oberoi Realty and Bank of India were under selling pressure.

There may be a sharp correction or the bull may keep running. Whatever the result, security lies in high-quality largecaps that now only move slowly, rather than smallcaps that fly away. There is a bubble in small caps that will end badly for new retail investors chasing those small caps. Investors can book some gains and invest the money in fixed income securities and continue to invest in high quality largecaps in the IT, metals, pharmaceuticals, cement and FMCG sectors

– Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services

Q3 result today:

Infosys, L&T Technologies, Hastun Agro Products, Craftsman Automation, Dodla Dairy and Tinplate Company of India are among the companies that will announce their quarterly results today.

Reliance Securities intraday selection:

Buy Aarti Industries: For today’s trading, a long position in the range of Rs 850-855 can be opened at a price target of Rs 876 with a strict stop loss at Rs 842. Buy City Union Bank: For today’s trade a long position can be initiated in the range of Rs 161-163 for a target of Rs 168 with a strict stop loss at Rs 159. Sell ​​Godrej Consumer Products: For today’s trading, a short position can be initiated in the range of Rs 950-958 for a target of Rs 925 with a strict stop loss at Rs 964.

Traders post profits in real estate stocks; Nifty Realty index down 0.4%

Top winners and losers in the Sensex pack

Opening Bell: Sensex loses 50 points, Nifty under 15,800; Just Dial jumps 4%, Quess Corp tanks 3%

Pre-open session: Sensex up 20 points, Nifty below 15,800

Q1 results today

Mindtree, Tata Metaliks, Shree Ganesh Remedies, Deccan HealthCare, WS Industries (India) and Gagan Gases are among the companies that will announce their quarterly results today.

Zomato’s initial public offering of Rs 9.375 billion opens today

The highly anticipated Zomato IPO opens for subscription today. The online grocery and restaurant platform raised Rs 4.197 billion from 186 anchor investors on Tuesday ahead of its initial public offering. The company told the exchanges that it had allotted Rs 55.22 billion of shares for Rs 76 per share to anchor investors.

SGX Nifty signals a negative start

Nifty Futures on the Singapore Exchange traded 53.5 points, or 0.34 percent, lower at 15,781, suggesting Dalal Street was off to a negative start on Wednesday.

Tech View: Nifty50 resistance at 15,900 at

Nifty50 had a positive session on Tuesday as it easily broke its immediate resistance at 15,750. The index formed a small bullish candle with a long wick on the daily scale, indicating that every intraday sale was bought. Analysts said the 15,900-15,915 zone would be a major hurdle and the 15,650-632 range would act as immediate support for the future.

Tokyo stocks open lower US falls

Tokyo stocks opened lower on Wall Street on Wednesday after falling as investors weighed how a rise in US inflation data would affect monetary policy. The benchmark index Nikkei 225 lost 0.74 percent or 211.64 points to 28,506.60 in early trading, while the broader Topix index fell 0.54 percent or 10.63 points to 1,957.01.

US CPI inflation climbs to 5.4% in June

The US Department of Labor report showed that the consumer price index rose 5.4 percent (non-seasonally adjusted) in the 12 months ended June, its highest level since August 2008. Even though leading Fed officials say the big price increases are temporary Persistently high inflation could lead policymakers to distance themselves from the massive economic policies that markets have loved since the beginning of the Covid-19 pandemic.

US stocks have leveled off

Major US stock indices closed lower Tuesday after government data showed inflation continued to rise in June. All three major indices had finished on Monday with records, but by the close of trading on Tuesday the Dow Jones Industrial Average benchmark was 0.3 percent lower at 34,888.79. The broad-based S&P 500 lost 0.4 percent to finish at 4,369.21, while the tech-rich Nasdaq Composite Index fell 0.4 percent to 14,677.65.

The rupee will rise on day 3 and close at 74.49 if the stocks rise

The rupee gained 9 paise to close at 74.49 against the US dollar on Tuesday, marking the third straight day of gains from foreign fund inflows and positive domestic stocks. On the interbank foreign exchange market, the local unit opened higher at 74.49 versus the greenback and experienced an intraday high of 74.41 and a low of 74.50 during the session.

Sensex, Nifty on Tuesday

At the closing bell, the BSE Sensex was 397.04 points, or 0.76 percent, higher at 52,769.73 – breaking its three-session loss margin. This was also the benchmark’s best daily gain since May 31st. Likewise, the broader NSE Nifty rose 119.75 points, or 0.76 percent, to settle at 15,812.35.

Good morning, dear reader! Here is something to start your day of trading

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Uber’s quarterly loss declines to $1.78 billion in Q2 as food delivery business takes lead

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Uber, the company which proclaimed that it had enough capital to ‘get through 2020 no matter what,’ might just need to search its pockets again, as Q2 revenues take a massive fall, compared to both last quarter and year. In its earnings call today, Uber declared that net revenue declined 29% over the year, or 27% on a constant currency basis, and stood at $2.24 billion.

On the flip side, losses shrunk over the year, coming at about $1.78 billion in Q2, down from a massive $5.24 billion last year. The company also spent $131 million in stock-based compensation expense and $382 million in restructuring and related charges, which made up for a massive $513 million of Uber’s total losses. However, this can also be attributed to the gargantuan one time non-cash costs that came with last year’s IPO.

“COVID-19 response initiatives had an impact on GAAP net loss of $48 million, including an impact on GAAP revenue of $6 million, and an impact on GAAP cost of revenue of $22 million, and an impact on total operating expenses of $20 million,” the report reads.

While it became entirely clear that COVID 19 is not a good time for the mobility sector (as if it wasn’t clear enough already), Uber saw a massive uptake in its food delivery business. While the net revenue declined by 29% over the year, the food delivery business handled by Uber Eats grew by 103% year-over-year, bringing in $1.2 billion. In comparison, the mobility part of the company’s business shrunk by 67%, and stood at $790 million, down from $2.4 billion in 2019.

Moreover, while the ANR (adjusted net revenue) of the entire corporation declined 33% year-over-year, it was mostly due to the mobility ANR taking a dive of 66%, $793 million. The food delivery business on the other hand saw a rise of 162% in its ANR, a testament to the fact that Uber might be witnessing a massive shift in its business.

However, this decline in business does not mean that the mobility business is dead. Nelson Chai, CFO of Uber claims that the segment generated $50 million in Adjusted EBITDA profit, despite a 73 percent year-over-year decline in Gross Bookings, on a constant currency basis.

CEO Dara Khosrowshahi told analysts in a conference call that the recovery in ride hailing part of the business has been led by Asia, even though India still has not gotten back in Ubers yet. “Asia, excluding India, is in the recovery lead. We’ve seen gross bookings of Hong Kong and New Zealand at times exceed pre-Covid highs,” Khosrowshahi said.

The company already sold Uber eats India to competitor Zomato, for a 9.99% stake in the company, and thus, was unable to leverage the rise in demand of food delivery platforms caused by COVID 19.

Moreover, the company also streamlined its operations in the quarter, removing over $1 billion in annualized costs across the entire company, as well as reducing Corporate G&A and Platform R&D costs by over $150 million compared to last quarter.

In fact, the company remains hopeful to this day, and based on its “strong balance sheet”, hopes to achieve Adjusted EBITDA profitability before the end of 2021.

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[omotoio-blog]

Why your customers will NOT recommend you?

Customers not recommending your brand in the face of ever increasing advertising costs?

It depends on the relationship you have built with them!

Create in your customers raving fans who love to do business with you

 CLICK HERE TO CLAIM YOUR FREE E-BOOK

 Click to get a FREE copy on how a financial services company used NPS® to take their relationship with customers to the next level

Well, in today’s world of price wars, competitions and what not, it is safe to equate business with warfare. Without further ado, let’s leap into the mired down world of customer valuing and gain bonus customer publicity- all this without any collateral damage.

Why are recommendations important in the first place?

Think about it. Do you wonder when you shell out the money for a 5 square centimetres of space on a newspaper, why don’t you invest that money to hire an employee in your customer success team? Before you gaffe at this statement, let’s delve a little deeper into the king’s mind (customer is still the King!)

Remember that restaurant you went to five years back?

If you do, there is a very high probability that the restaurant not only served excellent food and had a great ambience, but every frontline employee, from the waiters to the branch manager wore a beautiful smile, were available at your every beck and call and gave out the “please come back” vibe.

Now carefully scan the past 5 years, recall how many people you have recommended that restaurant to, and BINGO!

You have your answer served on a platter!

Log into Zomato and read the comments on any restaurant and you will notice invariably that restaurants with a high rating (4.0 and above on a scale of 5.0) have favourable comments not only about the food served there, but also the warmth of the employees. Every comment, whether positive or negative is personally replied to by the management, and it is this personal touch that makes a customer want to come back again and again.

Think this is overhyped? Think again.

Statistical research by News

works has claimed that newspaper advertising gets an average of 7% increase in sales, while a happy customer with a positive online review is likely to get you at least an 18% increase in sales (according to Reevoo).

Now, let us assume a disgruntled customer has not given any negative reviews (just an assumption, a detractor will likely spread his/her complaint and you know how rumours mutate),

products with positive ratings sell up to 200% better than products without reviews and amongst those sites that display reviews, 42% saw an increase in average order value (webrepublic.com).

These statistics speak volumes about the modern siege warfare being fought between different brands to gain the favour of their customers.

Satisfaction vs Loyalty

To earn the right to ask your customer’s recommendation you should focus on building loyalty and not just satisfaction. This is your first step in building an army of raving fans.

A loyal customer is usually always satisfied, while a satisfied customer is not necessarily loyal. Customers are said to be satisfied when they have made a purchase or availed a service and are satisfied with the experience. Customer loyalty meanwhile would mean the customer is not only satisfied with the product or service, but is also making repeat purchases from the same seller.

An example to distinguish this would be Amazon and Flipkart. If I am satisfied with a product I purchase from Flipkart, that would mean I am a satisfied customer, however it does not imply my loyalty as I am equally willing to purchase the same product from Amazon if it has a better price or feature. Every satisfied customer that you gain will inadvertently recommend your brand and bring in a stream of new customers. That’s how this web works, one customer brings in 5, the 5 bring in another 5 each and this goes on and on till you can keep them all satisfied.

What is customer loyalty after all?

•   Focusing only on sales number and reward points as a measure of customer loyalty can correlated to dangling a carrot in front of a rabbit. The rabbit keeps coming to your snare if the carrot is there, the moment there is no carrot, the rabbit disappears along with the carrot and we lose the brownie points. To put this into context, if your store is keeping reward points to attract customers without really giving them a satisfying experience, it will fail to induce customer satisfaction. Once that promotion scheme is taken off, the customer will no longer be satisfied and will move on to a competitor.

•   If an organisation is more focused towards selling more units to earn more financial profits, it will focus more on aggressive pricing and advertising policies. This will reap profits in the short run, but alienates customers in the long run and thus fails to make the connect that is required to maintain a relationship. Customer loyalty should never be based on the units sold. If that is the case, salespeople will try to induce people to buy more units and/or more expensive products. This is not a healthy practice, as inevitably a competitor will come up with a better or cheaper product; and customer loyalty will show its true colours. With telephone companies racking up to 30% of their profits from hidden charges, this is no surprise.

Sometimes, statistics do speak for themselves. Forrester research has proven that retaining a loyal customer costs 4 to 5 times less than acquiring a new one.

What is the final objective of any business? To make financial profits, right?

WRONG.

The conventional understanding of profits has long expired and in today’s world of caveat venditor it is of prime importance to keep the customers in the loop without suffocating them. No more can managers afford to categorise all profits under the same head in a profit and loss statement.

Profits are of 2 types, good and bad. Yes, both are financial surpluses over expenses; yet they both leave behind a completely distinct footprint.

���   Good profits
are financial profits which are earned with customer satisfaction and loyalty. A good example would be Amazon. com could easily afford to advertise more than it does; instead, it channels its investments into free shipping, lower prices, and service enhancements. Founder and CEO Jeff Bezos has said, “If you do build a great experience, customers tell each other about that.”

•   Bad profits
are usually one time purchases and are earned at the expense of a disgruntled customer. The Ultimate Question 2.0, which is considered the gospel of customer centricity, says that up to 42% of AOL’s profits at their peak came from hidden surcharges and other expenses. That is one of the hundreds of examples of bad profits. If your business is expanding financially, yet your customers are not referring you, it is a potential warning sign of bad profits.

Finally, to earn the right to your customer recommendations, you need to build a relationship with your customers which is responsive

Click to get a FREE copy on how a financial services company used NPS® to take their relationship with customers to the next level

Responsive relationship

A responsive relationship is the one every organisation should strive to achieve. That relationship is what makes you make repeat purchases at your local grocery store.

Imagine walking into a store and being greeted by friendly and warm staff and having all your needs attended to. Such a relationship throws open the barrage for suggestions and such organisations usually take suggestions seriously and observe and act upon them. These are coveted organisations that every customer loves, after all who doesn’t love some personal attention?

Resistive relationship

A resistive organisation meanwhile is one which is not open to suggestions in practice. Customer feedback involves ALOA (ask, listen, observe and act), these organisations do the first function and fail at the other.

A classic example would be the video rental company, Blockbuster. They just could not adapt to the rapid change in the business environment and did not keep up with the advent of online streaming. They resisted changes and subsequently filed for bankruptcy merely years after gaining top market share in the video rental market in the United States.

Remember that restaurant we fantasised about some paragraphs back? What made you refer that place to dozens or maybe scores of people? Other than the food, ambience and staff behaviour, it was definitely the fact that you had a responsive relationship with that organisation. You were just in awe with that place, and thus voluntarily marketed them for free.

This leads us to the vital question of, what should you do to build a responsive relationship?

•   Focus on good profits. Good profits make your customers yearn for more; bad profits merely represent a growth financially.

•   Understand your customers and their needs. See how you can bridge the gap from where your customers are to where do they envision themselves. Help them uncover the need and understand how your product/service can help them realise the vision.

•   Do the basics first. A discount falls flat if there are hidden charges which you customers will ultimately come to know of. Deliver the promise made before going over and beyond.

•   Most importantly – Ask for it. Make it easy for customers to give you referrals. See if you can meet them face to face help them understand how their support will help you achieve your business goal and impact lives and ask for the referral.

Net Promoter Score®

NPS® is a powerful tool to help you measure your customer experience and provides actionable insights to build a healthy and responsive relationship with your customers. It is based on single question –Based on your recent experience with [YOUR BRAND NAME] how likely is someone to recommend us to your friends and family? The response is captured on a rating scale of 0 to 10, with the classification being:-

•   Score 1-6: Detractors. They cost you money, bad mouth you and in general consider your organisation an absolute waste of time and money.

•   Scores 7 and 8: Passives. They are satisfied, but not loyal. If a competitor provides a better feature or product, no prizes for guessing where they will leap to.

•   Scores 9 and 10: Promoters. Call them goals, for this is what you must yearn to score. They not only remain loyal, but also recommend your brand and are responsible for the good vibe surrounding your organisation.

NPS is calculated by subtracting the % of Detractors from the % of Promoters. The merit of the question is in the follow up question which is the “why”. The reason for the score.

This financial services company has used NPS® effectively to take their customer experience to the next level. See how

Click to get a FREE copy on how a financial services company used NPS® to take their relationship with customers to the next level