(Note: Due to concerns that the strong language of my original blog would overshadow the message, I have rewritten the first paragraph. The goal of this blog is to stimulate conversation – admittedly, through confrontation – in order to determine what correlation NPS really has and how to best use it, or not!)
As the Customer Satisfaction (CSAT) analyst in the Market Insights Team, I get a lot of questions about Net Promoter Score (NPS). As the “ultimate question,” NPS is being positioned as a cure to all business ills and a way to understand everything you need to know about your customers . . . with just one question. Most market insights professionals struggle with NPS as it goes against our training to accept data correlations which have not been proven. Presenting actionable insights tied to NPS when correlation has not been proven? It feels like selling snake oil and is likely one of the drivers for the view that “researchers hate this metric.”
Has NPS — like Britney Spears’ singing — been overhyped?
My professional colleagues — including Timothy L. Keiningham, Bruce Cooil, Tor Wallin Andreassen and Lerzan Aksoy (A Longitudinal Examination of Net Promoter and Firm Revenue Growth) and Jeffrey Henning (Net Promoter Score [NPS] Criticisms and Best Practices) — have already beautifully, and very analytically, dissected and disproven NPS. They are not alone in their views or criticisms. So, why do we still use NPS when there is no clear statistical conclusions as to its effectiveness?!
After two days of very well done presentations from the Bazaarvoice team, observers of the social space and some business leaders, I come away from the Bazaarvoice Social Summit with a few thoughts:
Generally, the big theme was that use of ratings and reviews by eBusiness pros continues to deepen and add value to overall business success. We heard from Argos, Urban Outfitters, J&J, Xerox, Adobe, Best Buy, Rubbermaid, P&G, LL Bean, 3M and Estee Lauder. All of these businesses showed how they have fully embedded the use of ratings and reviews content throughout their businesses. For example, improved product data gained from ratings and reviews content is sent to all customer touchpoints such as the call center, POS, etc., at Argos; Rubbermaid realized from review content that people don’t read packaging and found that products didn’t perform well when consumers didn’t use the product as directed, so it changed the packaging and the product collateral and thus set expectations more in line with the intended use of the product and now have highly satisfied customers. And the examples like this continued throughout the conference. Look for our coming snapshot report showing some other examples of how eBusinesses continue to mine this valuable content to drive business results.