Would you recommend NPS to a friend, relative or colleague?

Would you recommend NPS to a friend, relative or colleague?

If you were to recommend NPS to a friend, relative or colleague, what would your answer be? We were recently asked this question ourselves and answered a 7 or 8 out of 10. Here is why.

NPS (or the Net Promoter Score) has been around for about 15 years. During this time, many businesses have adopted the concept as a way of determining whether their brand is seen positively by their customers. Its beauty lies in the measure’s simplicity and ease of understanding; reasons why it underpins so many customer experience programmes. It is also really easy to include in a simple visual dashboard which goes down well with many company executives.

However, we were recently asked whether we would recommend NPS, and our own answer was only a 7 out of 10. Below is our answer why.

The question is asked in the wrong context

Often the question is asked about a whole company’s performance rather than an individual customer interaction and its resulting experience. For example, we have seen the question asked about the offer of an entire business providing Broadband, Telephone, Mobile and TV services. But not all customers subscribe to all the services, so how can they know what the other services are like. Not surprisingly, the company’s scores flat-lined for many years; customers just gave it an ‘average’ score of what they thought they ‘should’ give for the entire business, rather than what they ‘actually’ experienced at an individual touchpoint level. We believe that NPS is, in many cases, used too generically as a question to ask to cover all situations. Instead it should be asked about very specific events and experiences. The score can then be used to improve that particular interaction rather than trying to change the entire business based on misleading scores.

The question is asked in isolation

There is little point in measuring NPS unless you know what to change in order to convert customers to promoters and raise the overall score. Yet many programmes fail to adequately understand the relationship between NPS and key performance indicators which contribute to the NPS score. Either because they have never done the necessary analysis, they ask the wrong questions, or they even don’t ask such questions at all. Consequently, whilst steadfastly measuring NPS over time, they have little idea of what makes the score change and therefore have little real knowledge of what to change about their performance to get more recommendations from their customers. To make NPS programmes truly effective, we strongly recommend that before any programme is implemented, the business learns which key performance levers lead to changes to NPS and that these are included and measured in any study. Perhaps even more importantly, that the levers included are those that can actually be changed by the business.

There is too much reliance on a single headline number

NPS is often liked because as long as the trend is positive, the score can be used as a security blanket. Managers can say, ‘aren’t we doing well’ and carry on as usual. However, NPS can hide a multitude of sins. Particularly it is possible for NPS to be going up, yet other measures such as satisfaction and loyalty could be going down. Why is this? The reason is that NPS does not say anything about the relative movement of people between the three bands. Therefore, NPS can go up by virtue of more promoters and fewer detractors, but the satisfaction amongst the passives (and thus the sample as a whole) could be declining fast, and not show up as anything untoward in the NPS score. So, what’s our point? NPS is useful, but overreliance on just one metric can lead to very misleading conclusions being drawn.

There are cultural differences

Respondents in different regions have very different attitudes to giving certain scores. In some parts of the world they may never score higher than a 7 or 8 for cultural reasons, whereas in other regions a score of 10 is common. This is fine when looking at regions in isolation, but as soon as comparisons are made between different regions, major problems arise. Not knowing about this can lead to very different conclusions being drawn about the performance of a company in one region versus another. This is potentially true of any measure, but with NPS so widely used, it has become a major issue in global customer experience programmes.

So going back to the original question, Would we recommend NPS to a friend, relative or colleague?

Yes because it is simple and easy to use, but no because it must be used in context

Yes because it shows trends in a single number, but no because you shouldn’t use it in isolation

Yes because it gives a good indication of performance, but no because it can hide the true picture

Yes because it works around the world, but no because you have to factor in cultural differences

 

Please get in touch to see how we could design and deliver a world-class NPS programme for your company.



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