Measuring NPS can only get you so far. Whilst NPS is helpful in recognising deficiencies in the offering available today, it doesn’t necessarily tell you what to change or why. Some estimates saw Toys R Us having an NPS score of 15¹, above other retailers like Staples or Home Depot, yet the business is ending in failure and bankruptcy².
Despite the shortcomings of NPS, it is trusted by many organisations as a measurement of customer experience. This is because NPS is predicated on people’s past experiences (we have written on why customers are very good at telling us about the experience that they have received or are experiencing here³). What customers often struggle to describe though, is what they want.
Steve Jobs famously said, “customers don’t know what they want until you show them”.⁴ This quote was provided in the context of new proposition development, which requires a certain level of creativity and foresight. As part of creating experiences from services and products that are not currently offered, an organisation seeks to understand exactly what NPS fails to deliver– what customers want, rather than what they are unhappy with.
As defined, customer experience work has two distinct opportunities: improving existing experiences where NPS is one useful tool (sustaining improvement), alongside generating new creativity for proposition development, where using NPS is less useful (transformational improvement). Both opportunities offer the possibility of organisational growth and involve different approaches to achieve this.
Firstly, how to drive sustaining improvement for customers served by the organisation’s current offering. Here you would expect to identify and evaluate customer’s journeys, their touchpoints and pain points before prioritising which to improve. NPS is one of many useful components of sustaining improvement as it highlights current satisfaction levels. Indeed, this sort of work can be offered quantitatively;
Alternatively, new growth from propositions that customers have yet to ask for can create transformational results beyond sustaining improvement. For this, there is no scientific formula for success, although there are research methodologies that can support the creation of vision and creativity required. Qualitative research, for example, or exploratory sequential design⁶, can be useful in understanding which ancillary experiences complement a current proposition, as well as which customer’s behaviour, attitudes and beliefs can be exploited for new product development. Likewise evaluating services, products and operating models provided and used by competitors as well as in adjacent markets can help drive transformational change. Previous KAE work illustrates how this new growth can be explored;
To achieve an organisation’s maximum growth potential, customer experience should be viewed through both sustaining and transformational perspectives. With that said, the mix of this different customer experience work depends on both an organisation’s maturity and their competitive environment. Indeed, by understanding when to apply these two different approaches and how they relate to your organisations objectives you mitigate the possibility of celebrating your NPS results today but filing for bankruptcy tomorrow.
- An initial phase of qualitative data collection and analysis followed by a phase of quantitative data collection and analysis. This research strategy is useful when developing and testing new propositions.
- KAE CX case study