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net promoter score

Net Promoter Scores: The Good, the Bad, and the Ugly

It’s one of the most popular metrics…and for good reason. The Net Promoter Score is generally seen as one of the most effective survey tools for measuring customer loyalty. But is it really as good as the hype makes it out to be? In this post we dive into the pros and cons of the NPS to give you a realistic idea of what to expect from it, and how to make the most of it.

What is it?

The Net Promoter Score is a customer loyalty metric summed up into one question and follow up:

“How Likely (on a scale of 1 to 10) are you to recommend our product, and why?”

This question alone has grown to be one of the most common ways companies gauge their customer loyalty. Here are a few reasons why it’s so popular.

PROS

  1. It’s simple- As you can see, the concept of the NPS is all about simplicity. One, short, easy to measure question makes this survey simple and easy for the customers filling it out as well as for the marketing team that is left to analyze it.

Customers love it because it is short and to the point, but gives them room to provide more detailed feedback if they want to. Companies love it because it is easy to measure and can be benchmarked: meaning you can compare your score with competitors, and compare with previous years.

  1. It gets good feedback – Because of the very fact that it’s so simple, NPS surveys tend to get a lot more feedback than other surveys.

Did you know that 80% of customers will abandon a survey because of drawn out, useless questions?

The NPS survey avoids losing those bored users and allows you to capitalize on responses from those who usually abandon a survey when it gets too long and tedious. Sending out a survey your customers will actually respond to is the key to gaining useful customer knowledge.

  1. It’s effective- The main reason why the NPS is so popular is simply because it’s effective. The reason it’s so effective is in its wording: The NPS metric doesn’t just ask if a customer likes a product, they ask whether or not they would stake their reputation in order to recommend it to someone they care about. This wording shifts the gears and heeds a way more honest, informative response from customers. 

One study shows that no matter your industry, the NPS survey question is “the best or second best predictor of repeat purchases or referrals.”

Because it’s such an effective predictor of customer loyalty, it’s seen as the frontrunner for companies trying to feel out how their customers view their company as a whole.

  1. It introduces you to brand ambassadors- The NPS score doesn’t just give insight to your customer loyalty, it can also help your marketing team discover new brand ambassadors for your company. Brand ambassadors are marketing gold and can sometimes be hard to track down. But when a customer responds with a 9 or 10 on the NPS survey, it’s fair to assume these are advocates for your product.

If you’re looking to find more brand ambassadors for your company, click here

CONS

We’ll be honest, we don’t have a lot of cons to offer regarding the NPS survey. However, it is possible to use the NPS metric the wrong way, which can lead to some big mistakes. Here’s some things to keep in mind so that you don’t use the NPS metric the wrong way:

  1. It’s not a miracle metric – Because the NPS metric is simple and effective, a lot of companies rely on it too much to solve their customer loyalty issues.

The reality is, the NPS is only one question, and while it can be helpful, it can’t tell you everything about a customer’s experience.  

Don’t let your NPS survey replace more thorough customer feedback surveys that dive into details about a customer’s specific transaction and specific experience with a product.

  1. It’s vague and requires follow-up- Because of its simplicity, the NPS survey is inherently vague. Do you know why someone picked 9 instead of 10? How much does that extra point matter?  These unclear issues are things that need to be discussed and analyzed as a company wide team so that you can figure out exactly what your results are telling you. Perhaps more importantly, it’s important to remember that each “why?” answer you receive from a customer is going to talk about something completely different and specific to their experience. Whoever is analyzing the responses needs to be able to sort the responses into sales, marketing, or customer service issues according to positive or negative feedback received.

The NPS answers also need to integrate with other metrics you have been collecting in order to make the most sense out of them and turn them into effective data that can be used to improve company performance. In other words, once you get the information on why people like or don’t like your services, you need to know what to do with that information, and this can be time consuming and require multiple levels of analysis.

In the end, when used as a part of a larger customer feedback strategy, an NPS survey is an incredibly useful, reliable tool that every business should capitalize on. If you think you might benefit from implementing an NPS survey, check out our blog post here on how it can benefit even the most struggling companies.

 

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