While reading a recent article published in MarketingProfs about the importance B2B marketing leaders place on delivering an excellent Customer Experience (CX) in driving their overall marketing strategy, I came across the following chart that reinforced my belief that the importance of the Net Promoter Score (NPS) metric is either extremely overstated or simply misunderstood.
The chart below (Figure 1) was presented in the article and highlights the characteristics of B2B companies that consider themselves Customer Experience (CX) Leaders, and states that one of the primary practices is “Collecting NPS regularly and acting on findings”.
Figure 1
The problem with this statement is that NPS scores are not actionable. How does one create a reasonable strategic plan to improve an NPS score of 36% if that is all you know? I am not downplaying the value of the NPS, but it is simply a measure of past performance…not a guide for future strategy.
NPS is supported by a long history of growth data associated with the measure as well as the logic that creating a larger percentage of promoters will ultimately lead to the growth of your business. Given the value of NPS in creating growth, the next logical question that needs to be answered is, “How can I ensure if my customers are recommending me over my competitors?” Without additional information, it is impossible to develop a meaningful NPS improvement strategy.
Armed with only a Net Promoters Score, it is challenging to develop a strategy designed to improve the percentage of promoters within the customer base. Why? Because the measure provides no insight as to what differentiates a promoter from a passive or detracting customer. Strategists must rely on anecdotal information, internal data and “gut feel” in creating an improvement strategy. To create a meaningful strategy, one must be armed with actionable data.
Making the NPS an Actionable Metric
By adding a short performance rating section on critical product and service related attributes to the traditional NPS survey and conducting a simple correlation analysis between each attribute and the NPS rating, NPS data can be made actionable and used in strategic planning.
In Figure 2, the attributes that drive “promoters” (NPS scores of 9 or 10) are listed on the vertical axis (from high impact to low impact). A competitive performance score is then calculated for each attribute, red bars indicate performance behind competition, while blue bars indicate performance above competition. In this example, the company is behind competition on 3 of the top 4 attributes driving “promoters”. Therefore, to improve overall NPS, it is imperative to improve in the areas of:
- Meeting customer quality needs
- Product consistency, and
- Understanding customer needs.
Figure 2
With this analysis, the NPS data can be used to create a well aligned strategic plan, with a high level of confidence that the desired results of improving the NPS will be achieved.
Hi, This is really an enlightening post about Actionable Metric. Thanks for sharing the useful information. Insightful reading!