Net Promoter Score’s Angels & Demons
Posted by Jeffrey Henning on Fri, May 15, 2009
There’s something devilish in the air. Wednesday night my wife and I watched a Dr. Who episode involving a demon, Thursday afternoon I attended a webinar where Fred Reichheld said market researchers thought he was the devil, and this morning my son complained that his camping trip meant he was going to miss tonight's premiere of Angels & Demons.
Since you probably don’t care about my family’s viewing habits, let’s turn to Fred’s presentation. Fred showed a slide with his face superimposed onto a cartoon devil, claiming that he has become the enemy of traditional market researchers. Among the criticisms he reported:
Net Promoter Score® oversimplifies customer loyalty
NPS is a score that doesn’t provide solutions
Market researchers have proprietary indices with greater validity
NPS is hazardous to your business
NPS does not correlate to growth
Fred is dumb or lying
Well, presenting an oversimplification of legitimate criticism of NPS is one way to attempt to inoculate your listeners from paying attention to that criticism. I thought it was amusing, but I will play along. In fact, I will play devil’s advocate and give Fred halos instead of horns for these contributions to loyalty research:
Discovering that customer retention is a key driver of profitability (q.v., Reichheld, Frederick F. (1993), “
Loyalty-Based Management,”
Harvard Business Review, 71 (2), 64–73)
Promoting the importance of very short surveys
Championing the need for a common loyalty measure across the enterprise
Pointing out that a 0-10 scale is an intuitive scale for telephone research, since—unlike a 1-10 scale—the 0 is unambiguously the worst score
Advocating the firing of staff who cheat on their customer-feedback numbers and discouraging organizations from tying that feedback to compensation
Making NPS free
That last is important. As he said: “NPS is an 'open source' system: you are all welcome to use it! You don't have to pay me to use it.” (I could have done without his next statement: “Therefore its bad business for market research, and why they call me a liar.”) But if you’ve ever gone to implement the five questions of the Secure Customer Index® or the one question of the Customer Effort Score™ and realized you couldn’t because they are proprietary, you’ll appreciate that there are no such restrictions on the Net Promoter Score.
Oh, and even if you liked the book (Angels & Demons, not The Ultimate Question), my advice is to skip the movie. This review of Angels & Demons said it all for me: "Hanks returns to the dullest role of his career, under the direction of Howard, who takes the material as seriously as a kidney stone on the way out." As for Fred, I’ll leave it to you to decide whether he is an angel or demon.
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