In 2003, the Harvard Business Review published a study by Frederick F. Reichheld entitled: “The one number you need to grow.”
That “one number” became known as the Net Promoter Score (NPS).
20+ years later, two-thirds of the Fortune 1000 reportedly use the metric.
Why? Well, it partially goes back to all the benefits Reichheld originally reasoned.
For instance, NPS is based on a single, straightforward question about the likelihood of recommending a company to others. That makes it easy for customers to understand and respond to.
NPS also allows companies to categorize each customer as a “promoter”, “neutral”, or “detractor”, which enables targeted customer engagement and retention strategies.
Moreover, with a standard survey question, NPS paves the way for companies to compare their scores with competitors’, providing a benchmark for customer loyalty.
Thanks to such benefits, NPS quickly became a stalwart metric across the CX space and remains deeply embedded in the DNA of most customer experience operations.
Meanwhile, many alternative metrics have failed to strike such a chord with CX leaders. Remember the Net Easy Score, anyone? How about Net Emotional Value?
Indeed, over the past two decades, NPS has remained a firm favorite of customer experience teams. But should it have? Many will argue otherwise.
Why does NPS Need to Change?
Despite the many benefits of traditional NPS surveys that Reichheld highlighted in 2003, times have changed, and so too has how companies leverage the metric.
Indeed, many businesses aren’t leveraging NPS in the way that the author had first envisioned.
That’s a huge part of why NPS needs to change, alongside the emergence of new tech. After all, there are now many more ways to gauge customer loyalty than 20+ years ago.
In recognition of all this, there are three core reasons why contact centers must consider moving on from traditional NPS surveys.
- NPS Has Become a Target, Not a Measure
Goodhart’s Law asserts: “When a measure becomes a target, it ceases to be a good measure.”
Unfortunately, that fate has befallen NPS, with the metric provoking a culture of hitting targets instead of closely considering what is best for the customer.
That trend has led to businesses gamifying the metric, making NPS results unreliable and – ultimately – distracting CX stakeholders from what matters most.
Moreover, the more marketing teams leverage NPS to frame their companies in a positive light; the more significant this gamification problem has become.
- Brands Have Started to Track NPS In Different Ways
Originally, the NPS question read: “On a scale of 1-10, how likely is it that you would recommend [company X] to a friend or colleague?”
Yet, some businesses have tweaked the question to gamify NPS. So, they may ask customers how likely they are to recommend their product, customer service, or something else that CX leaders know will generate a positive score, not the business as a whole.
Also, organizations will ask the question at a specific point in the customer journey, where they know customers are most likely to give them a positive score.