This must, somehow, be the season for looking at the real and granular actionability associated with marketing, brand, experience, and communication performance metrics. As someone who has done a great deal of b2b and b2c developmental research into drivers of brand equity, messaging effectiveness and customer behavior, especially with respect to the evolving decision-making landscape over the past decade, I have generated a number of blogs and articles on the detailed application of metrics, including:
A few weeks ago, I shared observations about the Customer Effort Score, or CES: http://www.customerthink.com/blog/its_time_to_get_really_serious_about_performance_metrics_what_works_what_has_challenges_and_why In this post, NPS, as a concept and metric, will be addressed based on recent findings presented by the insights manager of a prominent retailer, Jiffy Lube.
A recent Advertising Age article – http://adage.com/article/dataworks/jiffy-lube-net-promoter-score-goose-sales/243046/ – described the predictive limitations of NPS, as a standalone metric, for the Jiffy Lube service centers on a systemwide basis. As noted in the article, “…the overall NPS rating had almost no correlation to return visits. That meant customers who said they’d gladly recommend Jiffy Lube to friends didn’t necessarily return to the store themselves.”
However, because a high percentage of Jiffy Lube franchisees participate in the organization’s customer satisfaction research program, the insights manager used the added step of bringing in an outside consultant to apply text analytics software to the one-third of its 400,000 customer surveys who provided comments. When text analytics and NPS were dually utilized, linkage could be established between sales and return visits, vis-à-vis issues that these commenting customers identified.
It was the fusion of text analytics with NPS that actually helped Jiffy Lube identify key elements of the customer experience, and downstream behavioral drivers, And, that combination has enabled Jiffy Lube to significantly increase per-store sales. In the article, Forrester analyst Harley Manning noted that too many companies use NPS as a one-number indicator of how well the brand is doing, without knowing why the score is rising or falling. He added: “You have to do the work to find out what the drivers of the score are. Then when you figure that out, you have to tie them to specific practices.” In other words, some out-of-the-box thought has to be given to how NPS can be applied to touchpoint, brand, and communication improvement.
Many other customer experience and behavior experts, including Bob Thompson, Wim Rampen (http://wimrampen.com/2012/05/11/sorry-nps-im-not-buying-it/) and Bob Hayes (http://businessoverbroadway.com/unmasking-the-problem-with-net-scores-and-the-nps-claims) have addressed issues associated with NPS as a simple, and universally applied, performance metric. And, there have been an array of academic research studies speaking to the actionability problems with the metric, relative to its claims over the years (Keiningham, T. L., Cooil, B., Andreassen, T. W. & Aksoy, L. 2007. ‘A longitudinal examination of net promoter and firm revenue growth.’ Journal of Marketing, 71, 39-51; Sharp, B. 2008. ‘Net promoter score fails the test: market research buyers beware.’ Marketing Research, Winter, 28-30; East, R. 2008. ‘Measurement deficiencies in the net promoter score.’ ANZMAC. Sydney, Australia, etc.) So, there are both supporters and detractors for the Net Promoter Score as the only number needed for growth; and they can certainly voice their own perspectives.
Much more than insufficiencies of individual performance metrics, especially when they appear simple and universal, what’s largely at issue is the complacency, risk aversion, and ‘lemming effect’ often ascribed to marketing, customer experience, and brand research professionals, sometimes accurately and sometimes not. A lesson of the Jiffy Lube application is that a small infusion of analytical creativity can go a long way