Why We’re Not Fans of Net Promoter

Net Promoter has been a popular business metric for years.  We understand the number’s appeal – it is a well thought-out and reliable predictor of sales growth.  But it can fail your organization in one of the most critical ways. 

Back before I was ever in the software-for-retailers business, I was simply in the retail business.  I owned and operated a chain of retail stores. 

One day I had the idea that it would be great to circulate a weekly memo to everyone in my company.  I'd outline our goals for the week, celebrate victories, observe trends and champion ways to improve. 

My first one weighed in at 3 pages, and included two charts and a photo.  It looked like an advertisement for desktop publishing software.  I was pretty proud of it.  That is, of course, until I realized that none of my employees could recall anything I’d written. 

Following weeks saw the editor’s knife, and after a few months what remained was a weekly one-paragraph memo of fewer than forty or fifty words.  In 16-point type.  Each memo focused on not more than one concept together with some employee attaboys.  People read it, absorbed it and acted on it.  My broader literary abilities would have to lay dormant, pretty much until you came along. 

My lesson was that my front-line employees had their own daily routine and priorities, which are intimately connected to the substance of their daily job on the store floor.  Absorbing bigger business concepts and incorporating that information into how they performed their jobs could only happen if I didn’t overload them with too much stuff.  And the point where even very good employees tune-out is a lot lower than most managers realize.

The Problem with Net Promoter.  Net Promoter, developed by consultant Frederick Reichheld, is a well thought-out and reliable predictor of sales growth.  You calculate Net Promoter by applying a formula to the result of asking your customers to grade how likely they are to refer your organization to a friend or colleague.

But there’s a problem.  Like version 1.0 of my employee memo, it is too complex to be used as a tool to coach the front lines of your organization. 

To illustrate my point, try this two-part test.  First, see if you can remember the formula for calculating Net Promoter off the top of your head.  Over the years I’ve asked this question of a wide variety of people, and almost nobody can remember how to do it.  It’s so unintuitive as to escape the memory of almost everyone.

Second, try to imagine yourself and your front-line managers explaining that formula to every new hourly emplooyee hired in your company, and including that explanation in every review and staff meeting occurring throughout your organization daily.  It’s a formula for making eyes glaze over.

Let’s Remember Why We Measure.  The goal of measuring customer experience isn’t just so you can know where you’re pleasing customers and where you’re not.  It’s to enable your field teams to change their behavior such that the customer experience improves and, presumably, sales go up by virtue of improved retention.  And that change requires enough simplicity that necessary actions are totally clear and can remain front-of-mind during your employees’ work day.

And the truth is that you don’t really sacrifice much by keeping it simple.  It’s not clear to us that the complexity of Net Promoter yields you anything.  When we compare store lists of our clients’ locations stack ranked by Net Promoter with, for example, a simple average grade on Recommend to a Friend those lists are remarkably similar. 

Keeping it Simple.  Though we generally ask the Recommend to a Friend question first, we always follow it with not more than a handful of the most actionable questions relating to the success of our client's business.  And we always present the results to customer-facing employees in the simplest, clearest way possible.  (Usually a simple 30-day average grade.)  Employees waste no bandwidth trying to interpret what are clear, easy results. 

Net Promoter might well have an application in your organization at the executive level.  But when it comes to driving up performance where your customer-facing employees are concerned, we’d encourage you to employ a much simpler measure.   Your employees will thank you.