Net Promoter: The only number you need to grow
14 October 2014 by Chris McDonald
As part of SustainIt’s ongoing mission to provide great products and services to all of our clients, we are currently looking into ways of gauging feedback regarding our services.
Along this journey of self-reflection we have looked at different routes and methodologies to enable our clients to feedback on how we perform as a business. One system that seems to really be making waves is the Net Promoter Score (NPS). First presented by Frederick Reichheld in the December 2003 edition of The Harvard Business Review, it appears that NPS has gone from strength to strength as a key measurement for a company’s performance that seems to link customer satisfaction to increased company growth and revenue. NPS is unnervingly simple, it lacks any of the regular back patting and self-appreciation you see in standard customer satisfaction surveys and instead replaces it with one simple (yet fearsome) question; How Likely are you to recommend the company to a friend?
NPS is simple, the question is asked, and based on the responses you can be given a rating between -100 (very poor) to +100 (exceptional). NPS is used across the world by the business elite as a measure of how they are performing for their customers from Apple (+47) and HP (+29) to Netflix (+54) or even HSBC (-24). The system’s global reach is undeniable and over the last decade, has been relentless. Although widely used, NPS does have its detractors often stating that the question is not a definitive measurement of company growth or even customer satisfaction.
A lot of thought and consideration later and I come to the question I consider when looking at NPS; Is it really the only number you need to grow?
Do we need to ask how a customer feels about certain aspects of the business? Or even how they feel about my colleagues? What we do know is satisfaction surveys are not easy to create and often get bogged down with irrelevancies, this is often coupled with slow response times making it hard to gain qualitative data. With all of this in mind, the intensive streamlining that NPS provides, increased speed of response and correlation between results and growth do seem to make it the only number we need to grow.