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Net Promoter Score vs Customer Satisfaction score?

There is much debate on the value of customer loyalty metrics.  This post from my other blog, has attracted some debate, so thought I would open it here to this audience. The subject of customer loyalty measurement is a controversial, and deep topic for bankers. I have no particular axe to grind here on the debate, and am just curious which measurement is best.  Thoughts and comments appreciated. 


Interesting and thought provoking post here on the value of Net Promoter Score (NPS).  This is one of those topics that generates much debate.  The general theme in that debate, lies in the value of a relatively simple metric, and the extent that will drive appropriate behaviours, that will translate into improved customer loyalty, and revenue.  Detractors might suggest that a simple metric cannot provide detailed actionable ideas.

Laura Brooks, VP Research & Consulting, Satmetrix: Building Value One Customer at a Time

1) Net Promoter is simple but not simplistic.
2) Net Promoter tracks to growth.
3) Net Promoter is actionable.

I would argue in favour of NPS.  This example from the HSBC reference on the site, sums it up nicely.  The flaw in detailed surveys can lie in the assumptions that a series of detail can deliver.  I have seen this, and the sense of all is well, or the sky is falling that derives from customer satisfaction surveys.  Invariably what happens next is that the organisation focusses on correction of the individual questions that suffered the most.  When there are 100’s of questions, the likelihood that tactic will work is up there with lottery odds.

Satisfaction survey – good measure, but NPS more powerful. Only “delighted” were likely to be promoters. “Satisfied” were more likely to be detractors. This
surprising finding upset some people who thought they were doing a good
job with a 70% satisfaction rating, but their NPS didn’t tie up.

What I like about the NPS is that it shows the numbers of detractors, and forces you to consider why they are detractors, and not advocates.  Similarly those who are advocates, is it because they really are, or just that they haven’t experienced a service disruption.  Again the HSBC example refers to the high volume of call centre calls emanating from detractors. Speaking from my experience, the outcome of the call centre experience often creates detractors, from previous advocates.  Ditto for online banking service.

So, I fall on the side of NPS, because of the introspection it will drive, to achieve the three goals mentioned above. 

Relevance to Bankwatch:
For Bankers, I recommend reading HSBC example above.  It speaks in language from HSBC personnel that we will understand. 
[For Dr Laura, I would like to see more external specifics in the research made available, rather than blog references back into their own site.]

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