Are there economic benefits for Net Promoter? Yes, according to Satmetrix's Dr. Laura Brooks, one of the co-developers of Net Promoter. So what is the economics of Net Promoter?
Well, first, there is measurable economic impact from promoters as well as detractors. Straight to the punch line: On average, the relative economic impact of promoters who recommend is that they bring in additional $565 in revenue and while detractors are responsible for $701 in lost revenue. This is from a sample of B2B software companies. This data was calculated by understanding the number of referrals or negative comments these folks gave.
So promoters bring in more revenue through word of mouth marketing, but they are also a driver of revenue growth while detractors are drivers of lower growth. No surprise here. In addition, promoters total value is much more then detractors. Again, no surprise. What I found most interesting with all these benefits of promoters – they are also have a lower cost to serve. So they cost less and are more filling!
Laura talked about important to amplify promoter community through customer testimonials, inner circles, and special communities to further cement the relationship. While there is a lot of attention given to detractors by most customers it is the smart companies are also figuring out how to leverage these promoters through the power of Word of Mouth.
The last word on economics is that committed Net Promoter companies see financial gains. On average, with B2B companies studied, they experienced 23% revenue growth over a 3 year time frame, with an average 9% gain in Net Promoter.
What I wonder, with data like this, why aren’t all companies using Net Promoter?