Net Promoter Score
Market Research Services
It seems like everyone is measuring to get a Net Promoter Score.
The truth is, given the way most Net Promoter Scores are collected they are at best a very loose indication of customer experience.
The NPS intends to understand a customer’s sentiment and loyalty towards a brand, as well as whether they are more or less likely to promote the company.
The NPS scale divides respondents into three types of customers: promoters, passives, and detractors, and is based on a simple survey question:
“On a scale of 0 to 10, how likely are you to recommend our organisation to a friend or colleague?”
Customers who give an organisation a score of 9 or 10 are known as promoters, while those who provide a score of 6 or under are called detractors. An organisation’s score is calculated by subtracting promoters from detractors, ignoring customers that give a score of 7 or 8, who are known as passives.
Now, it this point it all seems straightforward, let’s go NPS crazy. However, this ignores a key truth, measuring customer experience starts with another question – what is their expectation?
I’ll illustrate with an example. Let’s assume Nokia was running an NPS measurement in 2006 and they are hitting it out of the park, they have an NPS of 60, which for NPS is a very high score (one of the highest scores in Australia is for Emirates, they have an NPS of 57).
Everyone in the Nokia boardroom is very happy, it’s summertime in Finland, let's all go out for sun-downer drinks which will finish around midnight.
2007 rolls around and the NPS has dropped to 15?! What happened? The iPhone happened. Suddenly the consumer expectations have changed dramatically, they want a sleek design, a big screen, significantly improved functionality. All the loyalty and goodwill implied by the 2006 NPS score has suddenly evaporated.
What this example tells us is that NPS is too simplistic and borders on what we describe as a vanity metric, it makes you feel good right now, but it is a poor measurement of the truth of your situation.
Want to measure better than NPS? Get in touch and we can discuss something better.