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Who finds actual value from Net Promoter Score? It's a vanity metric, just like asking "would you pay $10 for this?" instead of getting someone to actually pay

by web007 10y ago

Who finds actual value from Net Promoter Score? It's a vanity metric, just like asking "would you pay $10 for this?" instead of getting someone to actually pay $10. https://en.wikipedia.org/wiki/Net_Promoter#Criticism_of_NPS https://en.wikipedia.org/wiki/Net_Promoter#Criticism_of_NPS

randall 10y ago
It's really useful to know if your customers enjoy the product with a 1 question survey. We turned a 0/10 customer into 10/10 by giving them extra love. It's useful for us.
danaseverson 10y ago
You're correct, the number by itself, doesn't provide a ton of value beyond a measurable KPI. For some companies however, that KPI is one of their core metrics. Some companies even base compensation around the score. That said, the NPS methodology is much more than the overall score. The real value is in the individual scores, verbatim feedback and its proven ability to tie those results into both growth and churn. All combined (and when done correctly)it can help drive funding, determine PMF, guide your product roadmap, forecast revenue and drive measurable growth (just to name a few benefits). Breaking it down to just a score is looking at NPS far to simplistically.
- AznHisoka 10y ago
  atrributing verbatim feedback to NPS is misleading though. getting feedback is just talking to customers, surveys and methods that have existed for years. saying its part of the NPS methodology is giving it credit for something it did not invent.
  - danaseverson 10y ago
    You're right, feedback isn't exclusive to NPS, but you're missing the point. It's the type of feedback that is the critical difference here. Yes, you can ask any customer any question and get a response, but does that question/response elicit the same intelligent and predictive value of the NPS questions? Will randomly surveying your customers generate the same response rate as an NPS survey? NPS is a proven methodology with predictive intelligence and high response rate, what you're suggesting is not. The choice is yours though.
    - AznHisoka 10y ago
      "NPS is a proven methodology" That's a blank statement that tries to be authoritative and sounds nice, but where's the proof?
danieltillett 10y ago
Yep NPS is cargo-cult marketing at its worst. About the only thing going for it is so simple that even management can understand it.
trjordan 10y ago
It's a vanity metric, until you realize that for your business, it predicts churn. A lot of SaaS businesses have proved this for their customer base and found it's worth driving by. If it's not true for you, that's fine.
elihu 10y ago
I don't think NPS is all that bad, but the one reservation I have is that sometimes a high NPS might be due to factors that might be unadvisable to emulate. For instance, Apple has a very high NPS. A lot of Apple customers recommend Apple products to all their friends. Why might they do that? On reason might be that Apple products are high quality and their users have a good experience from using them. Another explanation is that there's a network effect and that Mac users want to be able to share programs and files and be able to get help when their computer breaks from their other Apple-owning friends. A manufacturer of Windows laptops might see that their NPS score is lower than Apple and take that as a sign that their customers are more unhappy with their products than Apple's (which very well might be true), but it could also be the case that, in general, Windows laptop owners don't particularly care what brand their friends all buy because Windows laptops are more-or-less interchangeable. Company executives might conclude that adding more proprietary features to their products and creating a walled-garden ecosystem like Apple's is a good idea, when it probably isn't.
aacook 10y ago
I think a good NPS survey asks why instead of just collecting a number and a great founder follows up to learn even more about why.
- AznHisoka 10y ago
  at that point its just a survey. why even prepend the buzzword "NPS" into it?
  - danaseverson 10y ago
    There is a clear difference between "just a survey" and an NPS survey. If you don't know the difference, I suggest you do some research.
ethiclub 10y ago
Ditched it, and now only deal with a cut down version every year or so with clients. CSAT has been far more illuminating. NPS often indicates success, while CSAT would actually show issues happening on the ground. It feels like NPS is idealistic and in the clouds, while CSAT is grounded and shows real feedback. Plus, clients just don't like NPS either.

by web007 10y ago

randall 10y ago

It's really useful to know if your customers enjoy the product with a 1 question survey. We turned a 0/10 customer into 10/10 by giving them extra love. It's useful for us.

danaseverson 10y ago

You're correct, the number by itself, doesn't provide a ton of value beyond a measurable KPI. For some companies however, that KPI is one of their core metrics. Some companies even base compensation around the score. That said, the NPS methodology is much more than the overall score. The real value is in the individual scores, verbatim feedback and its proven ability to tie those results into both growth and churn. All combined (and when done correctly)it can help drive funding, determine PMF, guide your product roadmap, forecast revenue and drive measurable growth (just to name a few benefits). Breaking it down to just a score is looking at NPS far to simplistically.

AznHisoka 10y ago
atrributing verbatim feedback to NPS is misleading though. getting feedback is just talking to customers, surveys and methods that have existed for years. saying its part of the NPS methodology is giving it credit for something it did not invent.
- danaseverson 10y ago
  You're right, feedback isn't exclusive to NPS, but you're missing the point. It's the type of feedback that is the critical difference here. Yes, you can ask any customer any question and get a response, but does that question/response elicit the same intelligent and predictive value of the NPS questions? Will randomly surveying your customers generate the same response rate as an NPS survey? NPS is a proven methodology with predictive intelligence and high response rate, what you're suggesting is not. The choice is yours though.
  - AznHisoka 10y ago
    "NPS is a proven methodology" That's a blank statement that tries to be authoritative and sounds nice, but where's the proof?

danieltillett 10y ago

Yep NPS is cargo-cult marketing at its worst. About the only thing going for it is so simple that even management can understand it.

trjordan 10y ago

It's a vanity metric, until you realize that for your business, it predicts churn. A lot of SaaS businesses have proved this for their customer base and found it's worth driving by. If it's not true for you, that's fine.

elihu 10y ago

I don't think NPS is all that bad, but the one reservation I have is that sometimes a high NPS might be due to factors that might be unadvisable to emulate. For instance, Apple has a very high NPS. A lot of Apple customers recommend Apple products to all their friends. Why might they do that? On reason might be that Apple products are high quality and their users have a good experience from using them. Another explanation is that there's a network effect and that Mac users want to be able to share programs and files and be able to get help when their computer breaks from their other Apple-owning friends. A manufacturer of Windows laptops might see that their NPS score is lower than Apple and take that as a sign that their customers are more unhappy with their products than Apple's (which very well might be true), but it could also be the case that, in general, Windows laptop owners don't particularly care what brand their friends all buy because Windows laptops are more-or-less interchangeable. Company executives might conclude that adding more proprietary features to their products and creating a walled-garden ecosystem like Apple's is a good idea, when it probably isn't.

aacook 10y ago

I think a good NPS survey asks why instead of just collecting a number and a great founder follows up to learn even more about why.

AznHisoka 10y ago
at that point its just a survey. why even prepend the buzzword "NPS" into it?
- danaseverson 10y ago
  There is a clear difference between "just a survey" and an NPS survey. If you don't know the difference, I suggest you do some research.

ethiclub 10y ago

Ditched it, and now only deal with a cut down version every year or so with clients. CSAT has been far more illuminating. NPS often indicates success, while CSAT would actually show issues happening on the ground. It feels like NPS is idealistic and in the clouds, while CSAT is grounded and shows real feedback. Plus, clients just don't like NPS either.