December 23, 2014 /
Comments Off on Net Promoter Score. Cheap is as Cheap Gets.

Net Promoter Score. Cheap is as Cheap Gets.

Are you customers loyal? Do they drive business? Restaurants fret over this question, as do most organisations.

Companies obtain their Net Promoter Score 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 can be categorized into one of three groups: Promoters (9-10 rating), Passives (7-8 rating), and Detractors (0-6 rating). The percentage of Detractors is then subtracted from the percentage of Promoters to obtain a Net Promoter score. A score of 75% or above is considered quite high.

There is a reasonable definition of Net Promoter Score (NPS) in Wikipedia at http://en.wikipedia.org/wiki/Net_Promoter (On which the above definition was based).

So it’s simple, easy to collate, and even easier to communicate to staff. But let’s look further. I am a Qantas frequent flyer with high status and rarely buy my own ticket (because most of my travel is business) would I recommend? Some questions

Who would I be recommending to? My budget conscious parents or my CEO peer group?

Would I be treated the same as others? I know I’m treated better. What about smokers? Are they likely to recommend to non-smokers? What about other smokers who have been smoking a rival brand for 20 years? Of course not.

Would you recommend you favourite nightclub to your family? Although you love the nightclub, you might not want your family there.

If you are a Bank Manager being evaluated, is it fair that you NPS is largely driven by Head Office policies which affect your customers? You might have given awesome service deserving of a 10 score, but your customer’s loan may have been unceremoniously declined by a computer program over a minor technicality.

It’s all about context. The moment you need to clarify context, the simplicity is lost. By all means, use NPS as part of your service matrix but not as the sole tool. And keep the salt handy, you may need a grain.