Report: Economics of Net Promoter Score, 2017

We just published a Temkin Group report, Economics of Net Promoter Score, 2017. Here’s the executive summary:

Net Promoter® Score (NPS®) is a popular metric that companies use to analyze their customer experience efforts. But how does this metric actually relate to loyalty? To uncover the relationship between NPS and loyalty, we asked 10,000 U.S. consumers to give an NPS to 331 companies across 20 industries, and we then looked at how this score correlated with four key loyalty behaviors. Here are some highlights from this research:

  • Compared to detractors, promoters are over four times more likely to repurchase from a company, over five times more likely to forgive a company if it makes a mistake, over seven times more likely to try new offerings from a company, and almost five times more likely to trust a company.
  • We performed a detailed analysis of the loyalty data for promoters, passives, and detractors across 20 different industries: airlines, auto dealers, banks, computer and tablet makers, credit card issuers, fast food chains, health plans, hotels and rooms, insurance carriers, investment firms, parcel delivery services, rental car and transport agencies, retailers, software firms, streaming media services, supermarkets, TV and Internet service providers, TVs and appliance makers, utilities, and wireless carriers.
  • Ultimately, if a company wants to benefit from using NPS as a key metric, it must focus on improving customer experience, not obsessing over the metric itself.

Download report for $295+
BuyDownload3

Note: To see NPS for individual companies and industries, download the report, Net Promoter Benchmark Study, 2016.

These two graphics from the report show the average connection between NPS and loyalty across all 20 industries, while the report also contains data for each of the 20 industries:

Download report for $295+BuyDownload3

While this report provides clear evidence that promoters are more valuable than detractors, it is not an endorsement of NPS as a metric. The data shows that companies should be able to increase their customer loyalty if they create promoters and cut down on detractors. As you will see on our VoC/NPS Program Resources, the processes for improving is more important than the specific metric being used.

Written by 

I am a customer experience transformist, helping large organizations improve business results by changing how they deal with customers. As part of this focus, I examine strategy, culture, interaction design, customer service, branding and leadership practices. I am also a fanatical student of business, so this blog provides an outlet for sharing insights from my ongoing educational journey.

Simply put, I am passionate about spotting emerging best practices and helping companies master them. And, as many people know, I love to speak about these topics in almost any forum.

My “title” is Managing Partner of the Temkin Group, a customer experience research and consulting firm that helps organizations become more customer-centric. Our goal is simple: accelerate the path to delighting customers.

I am also the co-founder and Emeritus Chair of the Customer Experience Professionals Association (CXPA.org), a non-profit organization dedicated to the success of CX professionals.

Leave a Reply