Issue #52: Do’s and Don’ts of NPS

There’s an ongoing debate within Customer Success about the merit of NPS and its correlation to retention rates. So when Brain LaFaille, Global Head of Customer Success Strategic Programs at Google, listed the Do’s and Don’ts of NPS I wanted to highlight this important topic and add my thoughts. You’ll notice that our views differ slightly—Brian is more empathetic towards NPS, whereas my view is that NPS isn’t useful.

Here's Brian's list

Note: The following is a short version of his list. You can read his full list here.

✅  Do: Track NPS

Tracking NPS allows you to gather valuable qualitative data about how customers feel about using your product. This qualitative data can embellish the usage (quantitative) data you’re already tracking from customers. 

❌  Don’t: Use NPS for variable compensation

Goaling monetary compensation on NPS typically doesn't go over well. NPS is purely qualitative and is dependent on the respondent's mood. Goals for variable compensation should be metrics that the CSM can directly impact and control. 

✅  Do: Follow-up with all NPS comments

When a customer provides your company/service with feedback, be sure to have a human touch to thank the users who felt compelled enough to share feedback. Consider having different responses based on the responder's score: 

• Promoters: ask them to fill out a public review of your service on G2 Crowds.
• Passives: ask what would make their experience even better than it is today.
• Detractors: thank them for their feedback which helps you learn and grow.

❌  Don’t: Silo NPS data

Feedback should be shared across the company. 

• Do you have a slack channel that highlights each of the comments from your users? 
• How about sharing this user feedback with the PMs in your organization? 
• How are you surfacing these qualitative dashboards to the rest of the business and your CSMs? 

✅  Do: Make NPS part of your broader “sentiment analysis”

NPS coupled with other qualitative data points can help you build comprehensive sentiment health. Components of sentiment include (but not be limited to):

• Support Interaction CSAT: What’s the score your users give their support experience?
• Onboarding / Implementation NPS: How did your customers feel about the onboarding experience they received? 
• CSM CSAT/NPS: What’s the NPS on the CSM that’s assigned to that customer account?

❌  Don’t: Focus on the number. Instead, focus on the trend.

Your actual NPS score doesn't tell you much and NPS alone can be a vanity metric. What's more powerful is measuring the trend of your NPS over time across your entire customer base, as well as specific customers. Powerful ways to leverage your NPS data include asking questions like: 

• Is your overarching customer experience improving, declining, or holding steady over time? 
• Zooming in one level deeper, what is the trend of NPS of a specific strategic account?
• Are the changes you're implementing for these customers landing with end-users and improving NPS?

Here's what I'd add to Brian's list

✅  Do: Ask other questions than the NPS question

Here are the questions I’d advocate for asking instead of the NPS question to actually understand the customer experience:

1. How severe is the ongoing problem that’s solved by the product? 
2. Do the product and service match the customer’s expectations?   
3. What features need to be added to make the product ‘complete’?

Customer Success leaders can aggregate this data and share it with other executive team members—the CPO, CRO, CMO, CFO—to influence discussions around the product roadmap, the customer profiles the company should target, the content that Marketing should be creating, and more. By relying on better data, CS leaders can get to the root cause of customer churn. 

❌  Don’t: Use NPS as an indicator of whether or not an account will churn

NPS is not correlated to overall retention rates. Other factors are much better indicators of the risk that exist on your account such as:

• How much value does the customer think they’re receiving from the product?
• What’s your champion coverage on the account? 
• How well integrated is the product into the customer’s business processes? 
• How severe of a problem does the customer think that this product is solving for them? 

✅  Do: Consider the value of NPS as a touchpoint

Every touchpoint with the customer is precious, so consider what value your organization receives from the NPS score (besides executive ego boosts)? How is NPS data used to improve the quality of the customer experience? Since the average NPS survey gets < 20% response rate, that means we wasted the time of the other 80%.

Alternatively, try collecting feedback via one-on-one interviews with customers, recording them, and transcribing them. You can get great feedback from usability testing on the product side when you’re trying to diagnose product problems. And it’s important to have some kind of social media monitoring product, where you’re scanning for the sentiment of your customers on LinkedIn, Twitter, and Facebook. This will help to understand what kind of real sentiment is going on in places where people are sharing information.

❌  Don’t: Think of NPS as an accurate measure of a customer’s health

Here’s why: 

• Recency bias: customers are more likely to react to a recent experience, rather than their overall experience with your company.
• Loudest voices: you’re much more likely to get responses from very happy or unhappy customers while missing the experience of the majority (90%) of customers.
• Not actionable: When NPS rises or falls, it’s not obvious what caused the change, or what to do differently to improve results. 

• Equal weighting: NPS assumes all customers are equal, but some customers (like a champion or buyer) have much more weight, and their feedback gets lost among other responses.

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