In this video, you’ll learn about Net Promoter Score and some of its criticisms.
#netpromoterscore #survey #wallstreetmojo #customerfeedback #brandloyalty
Chapters:
00:00 – Introduction
00:46 – Importance and uses
01:39 – Advantages
02:19 – Disadvantages
03:05 – Criticism
04:01 – Conclusion
Importance and uses
The NPS is an essential metric for companies to understand how their customers are experiencing their products.
Almost every large company uses this metric as it allows them to get a quantified figure that they can further work with.
Some marketers believe the NPS can give great insights into the company’s prospects.
Advantages
The NPS is considered to be a credible metric by people involved in the space as it was introduced by a top management consulting firm, Bain and Company.
Since almost every business uses this metric, it allows them to compare scores with one another and know their position in the market.
NPS helps companies assess gaps and work on the feedback given by customers, and all of this can directly affect their revenue and growth.
Disadvantages
Even if customers score 10 after being satisfied with the product, they may only sometimes recommend others to buy it. So here, the metric would provide an entirely different output.
There have also been debates on the categories of the NPS and the score ranges.
Criticism
Many claims that there needs to be more scientific or empirical evidence to prove that people giving a score of 10 is completely satisfied with the product and would recommend it to others.
It is said that the 11-point scale needs to be more credible and the best scale to use to measure customer preference. So instead, the 7-point scale is preferred.
It is also argued that a single question cannot describe the customer’s experience and satisfaction. The NPS is seen as less reliable than a set of questions as the latter can provide much more data.
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