NPS was developed by Fred Reichheld in 2003 and presented to the world as "One Number You Neet to Grow" in the Harvard Business Review. He presented a coherent concept to address the problem of unusable customer satisfaction surveys. These surveys were usually long and complicated, had low response rates, and produced inconclusive results from which managers could not establish clear guidelines for action. Plus, they are rarely questioned or scrutinized as most executives, board members, or investors don't take these surveys very seriously. Because the results just don't correlate closely with profit and growth.

Proponents of the NPS metric now claim it is closely correlated with profit and growth.

Opponents claim that what customers say is not closely correlated with actual consumer behavior. "The intention alone, or the declared willingness to recommend a company from which you have bought something, is useless."

Regardless, measuring NPS makes sense as it provides a base metric that lets you see at a glance whether sentiment about your company is evolving positively or negatively over time. And it also helps you identify the people who are at least claiming they are committed to your brand.

NPS is the fastest, easiest way to gauge consumer sentiment about your brand. And if an increase in NPS does result in more referrals, then NPS may be more important than ever. In any case, the NPS method shows a closer correlation to sales and growth than traditional customer satisfaction research.

NPS_imageThe focus on promoters makes sense in that customers have more and more opportunities to spread their opinions widely, positive or negative - so making sure they have something positive to say is more important than ever.
If you had the chance of a new customer in 2003 through two referrals from a customer, in 2016 you have the chance that your customer will tell 2 million people about your company on the blog, on Twitter, Facebook, Instagram, WhatsApp and via other portals. 

NPS cannot be compared to a precise, detailed customer satisfaction analysis. Rather, NPS can be integrated into a CX management system as a very valuable component with useful additions such as a well-developed error-cause analysis. How and, above all, why the basic NPS value and filtered NPS values ​​develop in a certain direction becomes the key here.

In the following parts of this blog series, we will give you some insights into our method. You will also learn more about how to keep customers better and why loyalty brings you more than new customer acquisition.

Do you measure NPS? Why or why not? Share your thoughts in the comments!