April 15, 2020
Why NPS is Probably Not the Best Metric for a Pandemic
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Many, if not most businesses today use NPS surveys to monitor their customer experience. There are good reasons why companies use NPS, and it can be a valuable tool for rallying organizations around the customer experience.
However, today we all face challenges that seemed inconceivable just a couple months ago, as Coronavirus has spread across the globe, changing lives dramatically. For every business, small or large, the ability to quickly adapt to customer needs will be necessary for overcoming the obstacles we face.
In this environment, NPS has become an unreliable indicator of customer health. Companies seeking to monitor and predict retention should start to seek out other metrics to provide insight.
NPS is a noisy metric on good days. Today, the noise is deafening.
NPS provides a broad, holistic picture of the customer experience. When someone is asked how likely they are to recommend a product or service, they are forced to think about their entire experience with it, not just one particular moment or touchpoint. However, this broadness also encourages people to take external factors into account.
Anyone who’s ever looked through open text follow-up responses to NPS has seen something along the lines of “I love it, but I don’t have any friends or colleagues who it’s relevant to, so I don’t recommend it.”
This is what we call noise in the data. Someone has given you a low rating, but not for the reasons you intended when you asked the question. Instead, an individual’s inability to think hypothetically has muddled your results. This is one of the primary failings of NPS: that the question we ask — whether users would recommend us — is not the question we actually want answered, i.e. whether users are satisfied with, or loyal to us.
Typically, this type of response is a relative edge case, but with a global pandemic drastically changing individual lifestyles, those edge cases are going to be much more common. People’s lives have been turned upside down; their ability to recommend your product, and their network of friends and colleagues to recommend it to have shifted dramatically.
Your customers’ actual experience with your product or their own likelihood to continue using it may or may not have changed. But the way they might answer an NPS question certainly has. What this means is that your NPS score, and changes you see in it, will be even more difficult to interpret than normal, and may guide you in the wrong direction.
- Scenario 1: Your NPS score is stable, but you’re bleeding customers. Why? Your customers may like your product as much as ever and continue to recommend it, but be unable to afford it for themselves.
- Scenario 2: Your NPS score is dropping, but without an equivalent increase in churn. Why? Your customers may continue to find your product essential but avoid recommending it to personal connections who have lost jobs or are sick.
The most likely scenario is that a combination of both of these factors is influencing how customers respond. Two different kinds of noise, both competing to completely blow up the reliability of your NPS score - making it virtually unusable.
What to do about it
If you’re already tracking NPS, you can continue to do so, but you need to know more about how customer priorities are shifting than NPS can tell you.
Do make plans to add additional CX metrics to your regular tracking as soon as possible. Retention is key for many companies right now, so focus on metrics that measure that directly.
Do ask companies about how the current environment is affecting their needs.
Don’t email users a 20-minute survey to collect these metrics. It may be perceived as insensitive; and besides, it’ll be a slow process when you need to move rapidly.
Do consider targeted microsurveys (in-product if possible) that take less than a minute of customer time.
If you’re unsure how to ask these questions to your customers, or what the best CX strategy is for your business, please don’t hesitate to reach out. We would be happy to help you design the right approach for you and your customers.