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Q&A Series: NPS and Social Customer Service

Lithium Alumni (Retired)

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Talk to any customer service executive and they'll know their Net Promoter Score (NPS).  It's either a badge of honor or a source frustration.

 

This week we look at the intriguing NPS methodology and how it translates to social customer service. What changes? What remains the same?

 

Lithium CMO @KatyK sat down with Lithium Social Web vice president @DaveEv to uncover the mysteries and truths of NPS.

 

Katy Keim: Quickly define NPS for our readers.

Dave Evans: I’m glad you said quickly, because there is a single, precise definition for Net Promoter score, or NPS:

 

NPS = Share of Promoters, as a percentage, minus Share of Detractors, also as a percentage.

 

Promoters and detractors are based on the answer to the question “How likely are you to recommend (company name)” where zero (0) is “extremely unlikely” and ten (10) is extremely likely. Promoters are defined as respondents giving a nine (9) or ten (10); Detractors are defined as those giving zero (0) through six (6).

 

The complete NPS description is here.

 

That’s it. Anything else, and it’s not NPS.

 

How do brands use NPS? Which departments care about this?

DE: Brands use NPS as a dynamic, long-term measure of a fundamentally important customer (typically) behavior: will our customers recommend us or not? This is an essential consideration for most brands, made all the more important by the adoption and transparency of social media.

 

How has social changed NPS?

DE: Social has not changed NPS. NPS has changed the way social media is viewed by the business.

 

So NPS is the constant regardless of what channel you look at?

DE: Yes. The formula and method for determining NPS is independent of any medium. NPS, however, because of its intimate relationship with primary social behaviors—people share stories about the experiences they have with friends and anyone else who will listen or take notice on the social web. This inherently includes conversations about brands, products, and services and in turn carries significance when those conversations turn to recommendations. NPS, because of its pure consideration of the likelihood of a recommendation, is an ideal and robust measure for this behavior.

 

Is it even possible to measure NPS on social channels?

DE: Absolutely, if by that you mean “Can I ask someone on Facebook, using a scale of zero to ten, how likely she is to recommend my company.” More commonly, brands measure NPS across all channels and touchpoints: again, NPS is independent of channel. A channel is a data point -- not a NPS in total.

 

And some brands have built upon NPS right?

DE: What some brands do—and while the application is not endorsed by the creators of the NPS methodology—is to ask a closely related question “As a result of this interaction, how likely are you to recommend [company]?” In this case, channel measures make sense, since all interactions occur in some channel or other. This can be useful, for example, in comparing the contributions of a social support team versus a phone support team to the overall organization NPS.

 

But a caution: any deviation from the established methodology and it’s no longer NPS. So don’t change a proven methology!

 

What's considered a good NPS score?

DE: While it probably comes as a shock—most of us went to schools with a 65 or 70 score considered “failing”— an NPS score of “zero” (0) is the starting point for “good.” This is because a score of zero implies that Promoters are equal in number to Detractors: for every customer, for example, that will promote you, one will knock you back down. So, on balance your likelihood of recommendation is “even.” As promoters begin to outnumber detractors, the net positive impact of recommendations rises.

 

By industry, what's a good score?

DE: As far as “really good” scores: The 40 through 60 ranges are right up there. Seventy-plus is outstanding: one of our Lithium customers, giffgaff, has an NPS of 73, which is remarkable.

 

For other industries—in particular those where customers perceive—rightly or wrongly—that business have the upper hand, the score can 30 and extend to below zero. In those markets, a company with an NPS score of -20 would be expected grow faster than a company with a score of -40.

 

Think of it as choosing the lesser of two evils.

 

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Want to see how your industry peers rank in NPS? Check out the leaders and laggards here.

 

The next Five-Minute Social Manager Q&A will tackle Experts. How to unleash experts within your company – beyond the traditional support roles.