For decades, companies have been trying to figure out if you like them using various surveys — long and short, direct and not — as the primary tool to get you to talk about your relationship with them. And, for decades, you’ve mostly ignored them, responded sometimes, and largely avoided talking about your relationship.
As with all relationships, there’s one thing that really matters: will they tell their friends about you? Word of mouth is the most powerful promotional tool you’ve got as a company. People who are fans of your product or service — really devoted to you and your company — will put their reputation on the line by sharing you with their colleagues and friends.
Enter the net promoter score (NPS), the simplest measure of satisfaction available. Introduced in 2003, NPS is quite simply a ratio of people who would recommend you to someone they know versus those who wouldn’t, based on the answer to a single question: How likely are you to recommend this to your colleagues or friends? At Wealthfront, we’re big fans of being direct and getting right down to it, so you know this clicked with us immediately.
Gathering the data is really easy: ask people to answer your question on a scale from 1 to 5, where 1 is “not at all likely” and 5 is “extremely likely.” The top 20% (the 5s) are your active promoters; the next 20% (the 4s) are passive but satisfied, unlikely to recommend but they’ll say good things if asked; and the rest are detractors who not only won’t risk their reputation by recommending you to others, they’ll probably give at best luke-warm reviews when asked. You could use a scale from 1-10 or even 1-100; since the metric divides into quintiles, we think the nuance offered by larger scales is lost and that a larger scale risks paralyzing them with too many choices in the name of false precision.
Let’s apply this to a practical, if somewhat absurdist, example: the annual deluge of April Fools’ Day pages on teh internets. Our own John Hitchings made an April Fools’ Ranking app (now closed) to collect some pages and votes. Let’s look at data for the 45 pages submitted:
Calculating NPS is as straightforward as the question itself. Just subtract the percentage of detractors from the percentage of promoters (both as compared to total respondents).
Let’s see how our merry pranksters did. Here’s the top 10:
|Box.net: Discover a New Dimension of Collaboration||16||1||17||88.24|
|Mind-boggling XKCD April Fools comic||20||1||22||86.36|
|ThinkGeek: Skyrim Electronic Dragon Shout Hoodie||10||1||11||81.82|
|What is Skype for String?||30||1||43||67.44|
|Collective Idea: Walken on Rails||53||11||64||65.62|
|ThinkGeek: Star Wars Admiral Ackbar Singing Bass||21||1||32||62.50|
|KODAK: Print Kittens At Home||18||0||30||60.00|
|CNET UK: Pirate Bay to launch own sub||17||1||27||59.26|
And the bottom 10:
|Slashdot: News for nerds, stuff that matters||1||8||19||-36.84|
|Introducing Shapes by Toshiba||1||12||23||-47.83|
|ThinkGeek: Barbie Digital Fashion Styling Head for iPad||1||8||9||-77.78|
|TechCrunch: Foxconn Plans New Iowa Plant||1||14||15||-86.67|
|ThinkGeek: Minecraft Marshmallow Creeps||0||11||12||-91.67|
|Google Fiber & Kansas City||0||11||12||-91.67|
|Google App Engine: Cloud API App||0||12||13||-92.31|
|Google App Engine Blog: Cloud API||0||14||14||-100.00|
NPS can range from -100 (no one would tell a soul) to +100 (everyone can’t wait to post it on their wall). Ranking above 30% is good; ranking above 75-80% is exceptional. And, of course, negative scores mean you may want to reconsider your hygiene regimen.
So there you have it. Now, go get undeniable proof that they like you, because they really, really do.