Executives need a more advanced tool for examining consumers' loyalty, one that provides a sharper, more precise view. this paper aims to introduce such a tool.
The paper looks at Bain's Net Promoter Score (NPS).
The paper finds that the tool needs to focus not on satisfaction and market share but on consumer advocacy, which is key to creating enthusiastic consumers who come back to buy offerings again and again – and are happy about doing it. Bain's NPS can reveal whether consumers identify emotionally with a brand and feel listened to and understood by the company that makes it. NPS scores help identify groups of consumers who feel well served by your product and groups that do not, whose needs you can then probe further. NPS opens a window into how well mass brands are actually serving profitable consumer segments, as opposed to catering to a statistically “typical” consumer who exists only in theory.
Because NPS scores help uncover determinants of future behavior, they provide a much better basis for spotting product weaknesses, evaluating a brand's health and helping gauge whether new products will succeed.
By producing and evaluating NPS data on a regular basis, organizations can institutionalize a cultural shift, making consumer metrics just as practical and auditable as financial metrics like profit and return on equity. They can make performance in the eyes of consumers just as critical a goal as financial performance.
