IS IT TIME TO DITCH THE NPS?
Why Traditional Customer Service Metrics are No Longer Relevant in a Post Digital Retail Sector

IS IT TIME TO DITCH THE NPS?
The most widely used system to measure and benchmark customer satisfaction is the Net Promoter Score (NPS). Launched in 2003 — before we’d Facebook, Instagram, LinkedIn and Snapchat — NPS is a management tool that can be used to gauge the loyalty of a firm’s customer relationships and claims to be correlated with revenue growth. It’s based on a primary survey question to existing customers of a brand or organisation: What is the likelihood that you would recommend Company X to a friend or colleague?
The result places the respondent into one of three groups. If a customer scores you as a nine or a 10, they are promoters. If they score you as a seven or an eight, they are passive. You don’t know if they are leaning toward loving you, leaving you, or they just don’t care. And, a score of a six or lower means you have a detractor. To determine your official NPS score, take the percentage of promoters (nines and 10s) and subtract the percentage of detractors (sixes and lower). That number is your Net Promoter Score.
Despite being a simple, easy to implement survey tool that serves as a benchmarking tool for customer satisfaction, the main problem with it is just that. It’s measuring customer satisfaction. When was the last time someone recommended a brand or business to you because they had a ‘satisfactory’ experience? Satisfaction doesn’t drive brand advocacy. Brand loyalty and advocacy are a result of customer experiences that exceed expectations, deliver ‘wow’ moments and surprise, delight and add value at every touch point.
NPS was created in an era where ‘customer service’ was a department that responded to customer enquiries and complaints. Today, the customer experience encompasses every touchpoint a customer has with an organisation.
The other aspect of the NPS system that makes its relevance questionable is the key question What is the likelihood that you would recommend Company X to a friend or colleague?
In an era of inner circles (best friends), social circles (Facebook, Instagram) and professional social circles (LinkedIn), what I would recommend to a friend might be different to what I recommend to a colleague. And what I might recommend online will differ dramatically from what I share offline.
Measuring customer advocacy in such a one-dimensional way is ultimately not delivering the actionable insights that customer research should. To really understand how our customers think and feel about our brand and more importantly what would make them a raving fan, we need to think less about a benchmarking score and more about a qualitative approach that provides the all important ‘why’, not just the ‘what’.
The NPS system also fails to consider the potential complexity of the customer journey. I might rate my initial interaction with a brand extremely positively, but have a subsequent interaction that fell way below my expectations.
Understanding where in the customer journey needs improvement and where the optimal times to capture brand advocacy exist is powerful information for marketers.
Today more than ever, brand experience matters more than just having a satisfied customer. Understanding your customer’s journey and experience over time is critical. Customers now interact through numerous touch points in multiple channels and media, and customer experiences are more social in nature. Each channel and touchpoint plays a crucial role in the representation of a brand and in understanding how your customer thinks and what they feel.
Customers who have responded positively to customer satisfaction surveys today may never be repeat purchasers. Just because they are happy with the service, doesn’t mean they are loyal or predisposed to proactively recommending your brand.
We must understand that customer satisfaction, customer loyalty and brand advocacy are all different things and not a result of each other.
Benchmarking customer satisfaction using NPS or something similar provides an important measurement of performance over time and in relation to competitors. But it should never be relied on as an indicator of brand loyalty and advocacy.
A more complete, qualitative approach including mystery shopping, customer journey mapping and ethnographic studies, cross referenced with social media insights will ultimately tell you not only what your customers think, but how they feel and why.

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