Is the Net Promoter Score Metric Outdated?
In a 2003 Harvard Business Review article, Fred Reichheld introduced Net Promoter Score® as a new way to measure customer loyalty and satisfaction.
That makes Net Promoter Score, as of 2017, 14 years old — an eternity for a customer success metric in the fast-paced world of technology. As a result, it’s understandable that some people might view Net Promoter Score as an outdated, overexposed and overused system.
The reality, however, is that NPS® is just as valuable as a customer satisfaction tool as ever. In fact, with web users more inundated with email-based distractions than ever, the simplicity of NPS could make it more valuable than ever before.
Are you stuck in the customer satisfaction bubble?
If you’re a customer satisfaction and retention expert that uses Net Promoter Score data every day, it’s easy to get the impression that NPS is everywhere online.
After all, you’re in the “customer satisfaction bubble” — an awareness of customer satisfaction tools and metrics that you’ve gained as a result of using them frequently. Since you’re familiar with systems like Net Promoter Score, you’re more likely to notice them when you use new products.
It’s easy to let this awareness distort the way you think of a system, product or service. Just like an advertising expert might be more aware of advertisements and a workplace safety consultant more aware of potential hazards, using NPS as part of your own business can make you see it everywhere.
When you receive a customer satisfaction survey in your email inbox, you can instantly identify it as using Net Promoter Score. When you see a modal customer satisfaction pop-up in the corner of a SaaS tool, you can predict (with some accuracy) the one question it’s likely to ask you.
This can make it easy to think that everyone sees the internet the same way and that NPS is far more “known” than it really is. The reality is that most customers aren’t aware of the mechanics behind NPS and respond to it with a fresh mind, creating valuable feedback for your business.
Most customers aren’t aware of how NPS works
Although Net Promoter Score is well known and widely used by online businesses, the majority of customers don’t know how it works.
For example, customers that purchase something from Amazon and answer a Net Promoter Score survey will most likely never send an NPS survey themselves, therefore the mechanics of the survey aren’t something they think about.
A great way to familiarize yourself with how customers will perceive your NPS survey is to walk through the customer journey yourself.
Create a free trial account for your own SaaS product, then send yourself an NPS email. You’ll see it as a free or paying user would — as a fresh email asking for honest feedback and a quick rating of your likelihood to recommend your product.
This is exactly how the vast majority of customers will see your NPS survey — as a fresh, honest request for useful feedback. Few people are so familiar with Net Promoter Score that they won’t provide accurate or valuable feedback.
Awareness of NPS can produce better feedback
Interestingly, we’ve observed that familiarity with Net Promoter Score can produce higher quality feedback.
We’ve noticed that our customers (all of whom use our Net Promoter Score software and have a complete understanding of what their score means) tend to use this knowledge to give us better signals and feedback on opportunities for improvement.
Contrary to the assumption that familiarity with Net Promoter Score produces worse feedback, the feedback we receive from people that are familiar with NPS tends to be the most valuable.
Not only is it more detailed, but it also tends to be more specific and actionable. Users that are familiar with Net Promoter Score are more likely to view the survey from the brand’s perspective and provide feedback that’s focused and easy to implement.
This is great news if you operate in a B2B industry where knowledge of NPS is widespread. If your audience is already familiar with NPS, there’s a significant chance that you’ll receive long, detailed and helpful qualitative feedback.
As we’ve covered before, the feedback you receive from your NPS survey is just as valuable — if not more valuable — than your NPS score itself.
NPS is widely used, but definitely not outdated
Look through NPS benchmark data and it’s easy to get the impression that NPS is overused as a customer satisfaction tool. After all, if almost every major brand in the world is using NPS, isn’t there a risk of customers becoming desensitized and apathetic towards NPS surveys?
Not really, the data suggests. Almost 14 years after it was introduced, Net Promoter Score is as valuable as it always has been. In fact, tools like NPS analytics and survey customization make it more valuable than ever for businesses focused on customer satisfaction and retention.
It’s now easier than it’s ever been for your business to analyze NPS feedback and spot trends in customer sentiment as they develop. Thanks to automation, it’s quicker and easier to send NPS surveys and collect data than at any point in time.
The end result is a metric that, far from being outdated or overexposed, is more valuable for any business than it’s ever been before. If retention and customer satisfaction are a priority, there’s never been a better time to start using Net Promoter Score.
NPS evolves constantly
NPS started as a very basic metric, requiring to run the surveys and collect the data by email, on a regular basis. As result, the obtained feedback was insightful, yet general, not connected to a specific feature, transaction, or process in the company.
It’s still useful to calculate your general NPS today, but it’s not enough anymore. That’s why new survey channels and campaign types were added to the NPS framework.
Besides the email channel, you can now trigger NPS surveys in a web or mobile application (in-app) to assess customer satisfaction while using your product. Customers are receiving NPS surveys as text messages or they’re asked to leave their feedback at the counters, in stores, by tapping the score on a tablet or smartphone.
Another important evolution of the framework is collecting feedback after each customer transaction or specific event triggers, which allows Customer Success and Product Managers to improve crucial processes in their customers’ journeys and increase the retention.
NPS reports have also become more insightful, allowing you to filter and recalculate your data based on offline or online touch-points, audience segments or other custom attributes.
Over the time, the framework became more sophisticated, while still keeping its initial appeal of a simple metric, and it looks that companies choose to rather improve the NPS methodology rather than switch to a new metric.
Start using NPS to survey customers and improve retention
Designed from the ground up for SaaS businesses and other companies that depend on long-term retention, Retently makes it easier than ever to survey your customers, generate helpful feedback and calculate your Net Promoter Score.
We’ve helped thousands of businesses use their NPS data to reduce churn, retain customers and generate more recurring revenue every month.
Learn more about how NPS works in our Net Promoter 101 guide and create your free account now to try Retently and start surveying your customers.
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