Net Promoter Scoring: How to do it
Guest post: Adam Ramshaw at Genroe: Net Promoter Score – how to do it?
Net Promoter Scoring was introduced to the world in a December 2003 Harvard Business review research article. This article, “The One Number You Need to Grow“, reported on research that had been performed by Frederick Reichheld from Bain Consulting in concert with a company called Satmetrix.
For the last 50 years companies have been trying to find a survey question that measured customer loyalty in order to better understand how and what drives customer loyalty. Until recently “customer satisfaction” had been used as a proxy for this information. Reichheld and Satmetrix set out to find if customer satisfaction was the best question once and for all.
It turned out that customer satisfaction was not the best question and the result was Net Promoter Score. By analysing the results from the question “On a scale 0-10, how likely is it that you would recommend our company to a friend or colleague?”, they obtained a metric that was well correlated with customer loyalty.
Actually performing Net Promoter scoring is reasonably straight forward. Survey your customers, ask the “Would recommend” question and then apply the scoring formula. However, what many organisations have found is that uncovering the score is important but not enough.
To be successful in using Net Promoter Score, organisations must put together an internal response processes to use the information and make changes in the business. Only then will customer loyalty increase.
Net promoter scoring can be used in both business to business and business to consumer companies.
For more information on Net Promoter Score and how/why it works download our free Introduction to Net Promoter Score (NPS).
If you are thinking about implementing Net Promoter Score (NPS) in your organisation give us a call. We can help you to implement an effective Net Promoter Score customer needs survey program for your business.
Net Promoter, Net Promoter Score and NPS are registered trademarks of Bain & Company, Inc., Satmetrix Systems, Inc., and Fred Reichheld.
Guest post from Adam Ramshaw at Genroe
Thank you Adam for your guest post on our blog. As always, the team at genroe have delivered highly insightful and ‘on the money’ insight for a single question which has created many-many years of Marketing debate.
I think this is a great introduction to Net Promoter Score (NPS).