NPS vs. Social Media For Market Research

NPS vs. Social Media For Market Research

One of the most common questions we receive, as an NPS®-focused software business, is how Net Promoter Score® differs from the type of data you can extract by studying people’s reactions on social media platforms like Facebook, Twitter and Instagram.

This is an easy question to answer, although one that’s best tackled in detail.

Discussion on social media platforms like Facebook and Twitter can be a powerful, accurate and valuable signal of public opinion, whether it’s aimed towards a business, an event or an individual.

In fact, social media is such a sensitive barometer of public opinion that during the presidential election, branding experts speculated that social media could be a more valuable platform for market research than traditional advertising.

It’s a statement that many, if not most, people in tech would probably agree with. Social media has immense value for market research, both from the perspective of providing a large-scale view of public opinion and granting the marketers a telescopic level of detail.

But is social media an accurate indicator of whether or not real, paying customers are satisfied with a brand? Maybe not.

Below, we’ve explained how Net Promoter Score and social media reactions differ as market research tools, as well as how these two sources of data can be used together to help your business grow.

NPS Measures Customer Satisfaction, Not Public Opinion

The biggest difference between NPS and social media sentiment is that one measures how paying customers feel about your product, while the other reckons (albeit, imprecisely) the way the general public feels about your product.

As any entrepreneur or marketer knows, public sentiment isn’t always a good reflection of a product or brand’s potential. Ask people whether or not they’d like to use your product before you launch and you’ll hear one “yes” after another; ask them to pay, and the results change.

For a marketer or growth-focused small business owner, it’s essential to know how customers feel about your product. After all, they’re the ones paying for your product or service and giving your business the opportunity to grow.

NPS provides a direct line of contact with these people — the ones who drive your business’s revenue, provide its growth and use the products and services it creates.

Social media, for all of its benefits (and there are numerous benefits to studying social media sentiment, as a marketer) simply doesn’t offer this, being less useful for in-depth feedback.

This unique advantage means that NPS has several gains for a growth-focused marketer or business owner that social media doesn’t. Used effectively, NPS:

  • Lets you know how exactly customers feel about your product, including the specific features they like or dislike;
  • Tells you explicitly why you’re losing customers (if you are), as well as what you need to do to win them back and reduce churn;
  • Helps you set actionable, realistic and achievable marketing and sales goals for your team to work towards;
  • Alerts you to negative customer opinions before they have the potential to spread to social media, helping you avoid damage to your brand’s reputation.

Monitoring social media can give you some level of insight into how the public feels about your brand or product. However, it’s a broad, general level of feedback from people that may or may not be your customers — something very different from the focused data provided by NPS.

What’s more, with 4.59 billion social media users worldwide, you may seem to have the entire world at service for you to discover your target audience and learn what drives them to make a purchase. However you may never reach the ones who don’t have a presence on these platforms, who depending on the industry you are operating in – maybe even more relevant.

Social Media Can Measure Brand Awareness, But Not Results

Another key difference between NPS and social media as market research tools is that they measure very different aspects of a company’s marketing efforts.

NPS measures the quantifiable, mensurable side of marketing — the thoughts and feelings of real, paying customers and their impact on your business. Social media, on the other hand, is far more accurate as a measure of the overall success of a company’s branding efforts.

This is especially true in B2B industries, as well as industries that are driven by results rather than brand image.

For example, investment banks and financial services companies like Goldman Sachs, Morgan Stanley and CitiGroup consistently score neutrally or positively in NPS benchmark data, despite rarely being the subject of praise on Facebook or Twitter.

Even Equifax, a consumer credit reporting company that ranked #1 on a list of America’s most hated companies as a result of its data security issues has a higher Net Promoter Score than well-known and widely loved brands like Disney, Prada and Red Bull.

In short, being liked (or even loved) on social media doesn’t necessarily mean that your paying customers have a positive opinion of your business. The phenomenon known as the “herd mentality” can also stay in the way of accurate data since social media users tend to be prone to influencing others’ opinion and behavior. Basically, social media can tell you if your campaign is working (or, in some cases, not working), but it’s not a metric that drives results.

Measure and Improve Customer Satisfaction Send a NPS campaign to your clients and start collecting, analyzing and acting on the received customer feedback free trial

Social Media Success Doesn’t Always Mean Growth

Finally, it’s important to remember that businesses that are successful on social media aren’t always successful as businesses.

The internet is littered with failed businesses that gained incredible amounts of viral attention through social media. From autonomous palm-sized drones to organic beef jerky, there are countless Kickstarter campaigns that have set social media ablaze yet failed to materialize.

Even huge, highly profitable companies have failed to turn social media buzz into a consistent source of revenue. The much-hyped Google Glass, which caught the attention of almost every social media user, ultimately failed as a new product line for Google.

Social media audiences gravitate towards the interesting and unique, but being interesting and unique doesn’t always translate into steady, sustainable growth.

Customer satisfaction, as measured using Net Promoter Score, does. When a company leads its industry in NPS, it will usually have an organic growth rate that’s more than double those of its competitors.

Pay Attention to Social Media, But Focus on NPS

In summary, while social media sentiment can play a useful role in helping your business grow and improving its brand awareness, it’s not a primary metric you can use to predict growth in the same way that NPS is. Hence, social media analytics can complement survey data, but not replace it.

While social media can be a great barometer of the public’s reaction to an advertising campaign or new product, you can’t use it to accurately predict factors like user churn, organic growth and customer retention that drive your business forward.

Our advice? Pay attention to social media — after all, it’s an important marketing channel and a valuable source of insight into public opinion. But don’t let it distract you from the one number your business needs to grow.

Start Calculating Your Net Promoter Score With Retently

Retently allows you to automatically survey your customers and calculate your Net Promoter Score, helping you stay on top of how paying customers feel about your business and increase your retention rate.

To start surveying your customers, sign up for your free trial of Retently now and send free NPS surveys with no contract or long-term obligation.

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