by Peggy and Arthur Winters
Net Promoter Score (NPS) has been defined as a management tool that can be used to investigate the degrees of loyalty in a firm’s customers’ experiences. It serves as an additional tool to traditional customer satisfaction research. The Net Promoter Score is obtained by asking customers a single question on a 0 to 10 rating scale. “How likely is it that you would recommend our company to a friend or colleague?” Based on their responses, customers are categorized into one of three groups: Promoters – extremely likely to recommend (9-10 rating), Passives – likely (7-8 rating), and Detractors – not at all likely (0-6 rating). Subtracting the proportion of detractors from the proportion of promoters and converting it to a percent gives a Net Promoter Score.
Any analysis of NPS reveals that it is being employed as a useful form of market research that can present companies with an understandable way to measure customer satisfaction without getting lost in deep data. It gets companies to think about their customers’ experiences and loyalty from the customers’ point of view. NPS and CX should serve as a matrix or model for how customers see their interactions with a brand / designer / store and/or website and how the brand should work to improve these experiences.
But answers to only one question will not reveal the whole story of WHY a customer might or might not recommend the brand. To improve one’s loyalty NPS, one must look for the root cause. These interactions include individual stages in the customer’s exploration, discovery, purchase, satisfied use and services rendered.
Additional ways to employ NPS as an indicator of customer loyalty could include:
ACE – Actual Customer Experiences and referrals – using point of sale, call center and billing data that signifies exactly what customer interactions have occurred…
SPA – Superior Perception of Attributes that are revealed through customer conversations that inquire how satisfying were their experiences with the good old 4 Ps — Product, Price, Place and Promotion.
APS – Analysis of Promoter Score through further evaluations of customer interactions asking what they did as a result of interactions with the brand (designer, product, store, website, or experience). Specifically: “Have you recommended this brand?” These evaluations are calculated to define customer perceptions, future intentions for purchasing, and importantly, recommendations and referrals.
NPS can be an effective predictor of whether, how, and when a customer might, and actually has recommended the brand to a friend, family or colleague.
Above all, NPS can also be an analysis of Customer Experiences (CX) that serves as a reference for a company’s Internal Branding. NPS can be infused as a metric for evaluating a company’s systems for creating related Customer Experiences (CX).
Arthur & Peggy Winters co-teach SXB 200 Brand Marketing Communications for Image & Meaning and SXR 050 Intro to Branding: The Art of Customer Bonding.