Metric analysis

Net Promoter Score: How CX leaders keep an old metric up to date

When organizations seek feedback on what their customers think about the products and services they offer, the Net Promoter Score (NPS) is often the first port of call.

NPS is an indicator that measures the likelihood that a customer would recommend the services of one business to others. It is delivered through a survey to the customer and the customers are then rated as “detractors”, “passive” or “promoters”, depending on the score they give.

A score of 0 to 6 means that a customer is a detractor, 7 to 8 means that they are passive in their opinion, while a score of 9 to 10 means that the customer is counted as a promoter, a susceptible person. to tell others about his excellent level. of the service they received.

The NPS has been at the heart of internal discussions on how to improve customer experience, loyalty and the value of life since its development in Fred reichheld in 2001. But not all companies use NPS as they should, industry stakeholders say.

Nate Brown, Experience Director at Officium Labs

“NPS has a long and distinguished history and the metric itself is old enough to have its own driver’s license,” Nate Brown, director of experience at Official laboratories, a global company that helps customers create better CX journeys, and co-founder of CX Accelerator, recently said Nearshore Americas.

“There is genius in the Net Promoter System, the methodology around the NPS. It helps a business identify its detractors and allows them to take intentional steps to make those detractors into promoters and even be able to quantify the value of that, through metrics like Customer Lifetime Value. The combination of these two metrics is powerful in calculating CX ROI, ”he added.

But the ideology of the NPS has become so dominant that many companies have used it for themselves. Simply collecting NPS is not a quick fix for customer experience issues.

“Some have used the NPS well, others have not. Still others have become addicted to it in a very unhealthy way, ”added Brown.

Making a Net Promoter Score actionable

The main criticism of NPS is not the metric itself, but how companies choose to apply it, Pete Weaklend, senior vice president of advisory services at Source of CX solution, a company that provides consulting services to clients looking to expand their contact center outsourcing services, explained.

Pete Weaklend, Senior Vice President of Advisory Services at CX Solution Source

“Customers can rate a business, but what is it going to do about it? How do these results become exploitable? If you can’t operationalize the improvements from your results, don’t collect the data, ”Weaklend said.

“If you ask, you had better take action. “

Before even launching an NPS survey, companies should have a plan for how they will begin to apply customer experience findings and turn them into solutions that will push detractors up the rankings to, over time. , the promoters of the company. This is, after all, the intention of NPS.

Keep it short and sweet

The industry’s focus on the customer experience has benefited customers by helping companies listen to their customers and, in turn, improve their services. Competition between industries means that the CX journey is a powerful tool in keeping business and differentiating one business from another. But it also means that companies’ demands to hear the thoughts of customers have become a pervasive irritation.

“The polls now irritate a lot of people, but at the same time it’s important to get feedback,” Weaklend explained.

“But businesses typically ask their customers to complete a 15-question survey. Nobody wants to do this! The polls should have two, maybe three questions, ”he added.

“If you can’t operationalize the improvements from your results, don’t collect the data”, – Pete Weaklend

For Brown, customers, especially Gen Z consumers, are tired of the constant demand for feedback. Many customers feel exploited.

“As a customer, if I’m overflowing with enthusiasm or frustration, I’ll leave a review or referral activity myself. But I don’t want to be manipulated into doing this, especially in cases where NPS is only used to identify promoters, ”he argued.

To help alleviate any dissatisfaction a customer may feel at the sight of an NPS survey, the company should guide expectations from the start, says Weaklend: “Set the right expectations: tell the customer it will take 15 seconds and make sure this is the case. “

Take customer sentiment into account

The age of NPS means questions are being asked about its application in a digital world, when advancements in technology provide a better understanding of customer behavior.

“All contacts who walk into a contact center can have text and speech scans applied,” Weaklend said. “Now businesses can easily identify trends and get textual feedback from customers to explain exactly what the problem is. It’s much easier than before.

“The NPS has a limited correlation with loyalty and behavior, and it loses its relevance with the modern public and requires investigation, which is why we will continue to move away from it”, – Nate Brown

For Brown, advancing technology means companies will begin to move away from the survey-based NPS approach to customer sentiment analysis, a method of processing communication – usually text – to gauge positive feedback and negative customers.

“It’s very easy to compare the NPS and it can be requested at any point in the customer journey. It’s all about relationships rather than transactions, and he’s a huge pro. But it has a limited correlation with loyalty and demeanor, and it loses its relevance to the modern public and requires investigation, which is why we’re going to continue to move away from it, ”Brown said.

NPS relies on honest responses from customers. Customer sentiment, which is taking the customer experience by storm, is more relevant and allows us to collect data in a much more advanced way, ”he added.

“If we look at the customer journey, the customer effort metric is much better at showing us the correlation with customer loyalty, which is what matters. “