The Net Promoter Score (NPS) is a popular management tool that is used in a variety of ways by firms, not-for-profits, and government. This study firstly provides an overview of the various ways in which the NPS is used. It then canvasses four concerns raised by researchers, authors and commentators about the NPS. These relate to (1) its presumed link to business growth, (2) the assumption that low NPS scores indicate negative word of mouth, (3) the weak association between stated likelihood to recommend and actual recommending, and (4) the claim that NPS is a superior metric to customer satisfaction. The evidence pertaining to those concerns is examined. The study then discusses another problem with the NPS that many practitioners are aware of, but has not been studied. The problem is that the counting method used to calculate the NPS introduces additional variation in scores compared to mean average likelihood-to-recommend scores. This additional variation occurs both across brands in a study, as well as for the same brand over survey waves. This variation is likely to be difficult for market research providers, or those who commission NPS work, to explain. The study concludes with alternative courses of action for NPS users.
AdamsC.WalpolaR.SchembriA. M.HarrisonR. (2022). The ultimate question? Evaluating the use of net promoter score in healthcare: A systematic review. Health Expectations. ahead-of-print.
AlismailA.SchaefferB.OhA.HamiduzzamanS.DaherN.SongH.-Y.FurukawaB.TanL. D. (2020). The use of the Net Promoter Score (Nps) in an outpatient allergy and pulmonary clinic: An innovative look into using tablet-based tool vs traditional survey method. Patient Related Outcome Measures, 11, 137–142. https://doi.org/10.2147/PROM.S248431.
4.
BaehreS.O’DwyerM.O’MalleyL.LeeN. (2021). The use of Net Promoter Score (Nps) to predict sales growth: Insights from an empirical investigation. Journal of the Academy of Marketing Science, 50(1), 1–18. https://doi.org/10.1007/s11747-021-00790-2.
5.
BaehreS.O’DwyerM.O’MalleyL.StoryV. M. (2022). Customer mindset metrics: A systematic evaluation of the Net Promoter Score (Nps) vs. Alternative calculation methods. Journal of Business Research, 149, 353–362. https://doi.org/10.1016/j.jbusres.2022.04.048.
BogomolovaS.RomaniukJ. (2009). Brand defection in a business-to-business financial service. Journal of Business Research, 62(3), 291–296. https://doi.org/10.1016/j.jbusres.2008.05.008
CoadA.DaunfeldtS.-O.HalvarssonD. (2018). Bursting into life: Firm growth and growth persistence by age. Small Business Economics, 50(1), 55–75. https://doi.org/10.1007/s11187-017-9872-8
10.
CohenJ.CohenP. (1983). Applied multiple regression/correlation analysis for the behavioural sciences. Lawrence Erlbaum Associates.
da Silva SantosD. A. (2019). Assessing the pattern between customer metrics and Net promoter score: A Portuguese insurance sector case study (pp. 1–42). Universidade Nova de Lisboa. http://hdl.handle.net/10362/71864
15.
DawesJ.StocchiL.Dall’Olmo-RileyF. (2020). Over-time variation in individual’s customer satisfaction scores. International Journal of Market Research, 62(3), 262–271. https://doi.org/10.1177/1470785320907538
16.
De HaanE.VerhoefP. C.WieselT. (2015). The predictive ability of different customer feedback metrics for retention. International Journal of Research in Marketing, 32(2), 195–206. https://doi.org/10.1016/j.ijresmar.2015.02.004
DevlinM. A. (2020). Comparing net promoter score and Jd power customer satisfaction index: Retail and small business banking. In Business administration, vol. doctor of business adminstration (p. 99). Wilmington University.
19.
EastR. (2008). Measurement deficiencies in the net promoter score. In ANZMAC conference. Australia: Australia and New Zealand Marketing Academy.
20.
EastR.HammondK.WrightM. (2007). The relative incidence of positive and negative word of mouth: A multi-category study. International Journal of Research in Marketing, 24(2), 175–184. https://doi.org/10.1016/j.ijresmar.2006.12.004
21.
EskildsenJ. K.KristensenK. (2011) The accuracy of the net promoter score under different distributional assumptions. In International Conference on Quality, Reliability, Risk, Maintenance, and Safety Engineering, Xi’an, China: IEEE, pp. 964–969.
22.
FarooqM.RajuV.Khalil-Ur-RehmanF.YounasW.AhmedQ. M.AliM. (2019). Investigating relationship between net promoter score and company performance: A longitudinal study. Global Journal of Emerging Sciences, 1(1), 1–10.
23.
FarrisP.BendleN.PfeiferP. E.ReibsteinD. J. (2016). Marketing metrics: The manager’s guide to measuring marketing performance. Pearson.
24.
FiserovaJ.PughG.DimosC.StephensonA. (2018). The effect of the net promoter score on sales: A study of a retail firm using customer and store-level data. In British academy of management 2018 (pp. 1–18).
GrisaffeD. B. (2007). Questions about the ultimate question: Conceptual considerations in evaluating Reichheld’s Net Promoter Score (Nps). Journal of Consumer Satisfaction, Dissatisfaction and Complaining Behavior, 20, 36–53.
27.
HamiltonD. F.LaneJ. V.GastonP.PattonJ. T.MacdonaldD. J.SimpsonA.HowieC. R. (2014). Assessing treatment outcomes using a single question: The net promoter score. The Bone & Joint Journal, 96b(5), 622–628. https://doi.org/10.1302/0301-620X.96B5.32434
HoekJ.GendallP. (2010). Colors, brands, and trademarks: The marketing (and Legal) problem of establishing distinctiveness. Journal of Advertising Research, 50(3), 316–322. https://doi.org/10.2501/s0021849910091476
JahnertJ. R.SchmeiserH. (2021). The relationship between net promoter score and insurers’ profitability: An empirical analysis at the customer level. In The Geneva papers on risk and insurance-issues and practice (pp. 1–29).
Jet Blue. (2015) Morningstar document research form def 14a. Jet Blue.
35.
JonesM. A.MothersbaughD. L.BeattyS. E. (2002). Why customers stay: Measuring the underlying dimensions of services switching costs and managing their differential strategic outcomes. Journal of Business Research, 55(6), 441–450. https://doi.org/10.1016/s0148-2963(00)00168-5
36.
KaraA.Mintu-WimsattA.SpillanJ. E. (2022). An application of the net promoter score in higher education. Journal of Marketing for Higher Education, 1–24. https://doi.org/10.1080/08841241.2021.2018088
37.
KeininghamT. L.CooilB.AksoyL.AndreassenT. W.WeinerJ. (2007). The value of different customer satisfaction and loyalty metrics in predicting customer retention, recommendation, and share-of-wallet. Managing Service Quality, 17(4), 361–384. https://doi.org/10.1108/09604520710760526
38.
KeininghamT. L.CooilB.AndreassenT. W.AksoyL. (2007). A longitudinal examination of net promoter and firm revenue growth. Journal of Marketing, 71(3), 39–51. https://doi.org/10.1509/jmkg.71.3.039
39.
KornetaP. (2018). Net promoter score, growth, and profitability of transportation companies. International Journal of Management and Economics, 54(2), 136–148. https://doi.org/10.2478/ijme-2018-0013
40.
KristensenK.EskildsenJ. (2011). Is the net promoter score a reliable performance measure? In IEEE International Conference on Quality and Reliability (pp. 249–253). Bangkok, Thailand: IEEE.
41.
KumarV.PetersenJ. A.LeoneR. P. (2007). How valuable is word of mouth?Harvard Business Review, 85(10), 139–146.
42.
LewisC.MehmetM. (2020). Does the Nps® reflect consumer sentiment? A qualitative examination of the Nps using a sentiment analysis approach. International Journal of Market Research, 62(1), 9–17. https://doi.org/10.1177/1470785319863623
43.
MecredyP.WrightM. J.FeethamP. (2018). Are promoters valuable customers? An application of the Net promoter scale to predict future customer spend. Australasian Marketing Journal, 26(1), 3–9. https://doi.org/10.1016/j.ausmj.2017.12.001
44.
MorganN. A.RegoL. L. (2006). The value of different customer satisfaction and loyalty metrics in predicting business performance. Marketing Science, 25(5), 426–439. https://doi.org/10.1287/mksc.1050.0180
Nenycz-ThielM.BealV.LudwichowskaG.RomaniukJ. (2013). Investigating the accuracy of self-reports of brand usage behavior. Journal of Business Research, 66(2), 224–232. https://doi.org/10.1016/j.jbusres.2012.07.016
OwenR. (2019). Net promoter score and its successful application. In Marketing Wisdom (pp. 17–29). Springer.
49.
OwenR.BrooksL. L. (2008). Answering the ultimate question: How net promoter can transform your business. John Wiley & Sons.
50.
ParackalM.BrennanM. (1998). Obtaining purchase probabilities via a web based survey: The Juster scale and the verbal probability scale. Marketing Bulletin, 9, 67–75.
PetersonR. A.WilsonW. R. (1992). Measuring customer satisfaction: Fact and artifact. Journal of the Academy of Marketing Science, 20(1), 61–71. https://doi.org/10.1007/bf02723476
RomaniukJ.EastR.NguyenC. (2011). The accuracy of self-reported probabilities of giving recommendations. International Journal of Market Research, 53(4), 507–521. https://doi.org/10.2501/ijmr-53-4-507-521
SchneiderD.BerentM.ThomasR.KrosnickJ. (2008) Measuring customer satisfaction and loyalty: Improving the ‘net-promoter’score. In Annual meeting of the American association for public Opinion research, New Orleans, Louisiana, USA, 1–94.
66.
SchulmanK.SargeantA. (2013). Measuring donor loyalty: Key reasons why Net Promoter Score (Nps) is not the way. International Journal of Nonprofit and Voluntary Sector Marketing, 18(1), 1–6. https://doi.org/10.1002/nvsm.1463
67.
SeifertC. F.YuklG. (2010). Effects of repeated multi-source feedback on the influence behavior and effectiveness of managers: A field experiment. The Leadership Quarterly, 21(5), 856–866. https://doi.org/10.1016/j.leaqua.2010.07.012
68.
SethS.ScottD.SvihelC.StephenM. S. (2016). Solving the mystery of consistent negative/low Net Promoter Score (Nps) in cross-cultural marketing research. Asia Marketing Journal, 17(4), 43–61. https://doi.org/10.15830/amj.2016.17.4.43
StirlingP.JenkinsP. J.ClementN. D.DuckworthA. D.McEachanJ. E. (2019). The net promoter scores with friends and family test after four hand surgery procedures. Journal of Hand Surgery (European Volume), 44(3), 290–295. https://doi.org/10.1177/1753193418819686
71.
Van DoornJ.LeeflangP. S.TijsM. (2013). Satisfaction as a predictor of future performance: A replication. International Journal of Research in Marketing, 30(3), 314–318. https://doi.org/10.1016/j.ijresmar.2013.10.003
72.
WrightM.SharpA.SharpB. (2002). Market statistics for the Dirichlet model: Using the juster scale to replace panel data. International Journal of Research in Marketing, 19(1), 81–90. https://doi.org/10.1016/s0167-8116(02)00049-6
73.
ZakiM.KandeilD.NeelyA.McColl-KennedyJ. R. (2016). The fallacy of the net promoter score: Customer loyalty predictive model (pp. 1–26). University of Cambridge.
