On a scale of 0-10, how likely are you to recommend this product/company to others?
When this question was initially introduced to CX, it seemed as if all problems were over. However, with time, we realized that NPS alone is not sufficient to know everything about customer experience despite being a powerful CX metric.
But it’s still used by small and big brands worldwide and applauded for its many benefits. If you want to adopt NPS to your CX strategy, knowing its benefits and drawbacks can help you optimize your CXM program better. Let’s take a look at them!
What’s great about NPS
Simple and convenient to use
The simplicity of NPS surveys is one main reason why most brands use them. The survey consists of only one question, and the answer is provided on a numerical point scale of 0-10. So, it takes less time to design the survey, and with our readymade templates, you can launch it in no time! The fact that it can be answered quickly and requires less effort from the respondent makes it more appealing to customers. You are most likely to benefit from a high response rate. NPS is also easy to calculate and is a good metric that offers a valuable surface-level picture of the business.
Measures loyalty and advocacy
Customers usually recommend only great products to their acquaintances, and if your brand has a high NPS score, consider it a big green flag about your products! Brands with high NPS scores also benefit from word-of-mouth marketing and lower advertising costs.
NPS also helps you identify who your loyal customers are and take proactive measures to retain them. Loyal customers can also increase your referral rate and bring a steady stream of income to your business. It’s cost-effective to treat them with better perks than spending on attracting new customers. Using NPS, you can reach out to your loyal customers and offer them personalized product suggestions, bundle offers, discounts, and membership programs.
Standardized and comparable
As all NPS surveys have the same standard question, you can use your score to evaluate if your brand is performing up to the industry’s expected standards. Different industries have different benchmarks when it comes to NPS scores, and it can be used to compare how well you are doing in terms of nurturing loyalty and advocacy. It is a reliable metric that any B2B or B2C brand in any industry can use.
Where does NPS fall short?
Bigger picture of your CX
NPS alone is not enough for brands to create a great customer experience for their clientele. Evaluating the quality of CX and the customer journey solely with your NPS survey results can lead to skewed assumptions. This is because the metric doesn’t capture the efficacy of all stages in the journey and focuses only on one aspect of customer loyalty – advocacy.
When it comes to CX, factors like customer satisfaction, emotional experience, and effortlessness in doing business also matter a great deal. So, If you want a well-rounded picture of your customer experience, it’s essential to use a variety of KPIs like EVI®, C-SAT, and CES.
Lacks contextual information
Unless you include open-ended questions at the end of the survey, NPS scores should be backed by contextual data for a deeper analysis. For example, a lower NPS, indicating customers’ unwillingness to recommend the brand, could be due to a myriad of reasons.
Also, some customers may leave the open-ended question unanswered or may not offer sufficient information. Without contextual data, it can be challenging to identify where the problem stems from and make improvements customers expect from your brand. Using NPS along with another versatile metric like EVI® that can be applied to any stage or touchpoint can resolve this issue to a great extent.