" …'Ere, he says he’s not dead. Well, he will be soon, he’s very ill. … I’m getting better! No you’re not, you’ll be stone dead in a moment. …I think I’ll go for a walk You’re not fooling anyone, you know"

Monty Python and the Holy Grail 

Surveys are the worst possible solution to the data collection problem, until you consider the alternatives, the joke goes. The punchline is that there are no alternatives. It’s fast becoming time to reconsider. 

Fact is, surveys are on a steady, but inevitable, fall from grace. I will illustrate my case through example. Google "Nielson Box" and choose images. Take a look at the pictures, it’s like looking at stills from one of those fashionable TV series set in the 50’s (which presumably Nielsen measures) when a computer could conveniently fit into a small living room (if you had the air conditioning, which you didn’t). It’s not the future, but it was the only available tech at the time. Advertisers showed you commercials, you watched (yes son, we watched TV commercials back then!) and advertisers had to figure out if they got value for money (good luck with that). Then came click through ads and you didn’t have to guess as much. Next, coupons attached to your facebook page that will not only enable the promoter to track your exact purchase, and that of your friends, but also probably whoever you stood in the line next to at Starbucks this morning. OK, I made that bit about Starbucks up, it’s not shipping yet. 

My point is this: the means to understand the effectiveness of promotions is shifting from the universe of analog, imprecise, measured by guesswork technology, into a world of “big data”: precision, measurability, real time. It’s not a surprise, it’s telegraphed. 

Surveying is reaching a zenith. Gone are the antique days of the clipboard, today we have … the digital clipboard! Low cost equals ubiquity. Fancy a beer tonight? Let’s survey the gang. We are getting saturated. 

In the short term, there will be a flight to quality. No, you can’t survey me and ask me if I did travel on the flight after all, or did I buy your product, you need to figure that out in advance. I won’t spend 30 minutes filling in your crazy complex questionnaire, especially if I suspect you won’t do anything with it anyway. Come to think of it, you didn’t do anything with it last time I sent it in. Please don’t make it look visually cheap: it’s a form of your market communication after all, what does it say about your firm? Oh, the ad at the bottom of the page is a nice touch, very professional. BTW, your colleagues in another department just surveyed me the other day to ask about the best color palette for the new microsite design, so I’m tapped out for the year.  

The bar is getting raised, and the companies that can’t leap it will find that nobody shows up for the party, or worse, only the folk who want free beer.  But that’s all today. In the long run we can see that surveys will be less important. Because your customers have already told you what they think.  

On the phone with your contact center. In email to your sales team. And above all, in the social web, to their actual friends, Facebook friends, LinkedIn friends-I-want-a-job-from, etc. Worse for you, unlike many survey responses, someone might actually be watching these comments. 

Now, our technology relies on survey data to work. And we are not seeing any sudden let up in demand for surveys. But, just because your uncle Frankie told you that Blockbuster stock was a buy in 1990 didn’t mean he was wrong at the time, just that you should keep an eye on the future while getting what you need to get done today. We will need surveys for the foreseeable future, but we need to start building our expertise around a future of social media, massive unstructured and unprompted data streams and, above all, customers who talk to each other at a time and place of their choosing, not ours. 

See you at the Net Promoter Conference in London in June, for Net Promoter 2.0

"All the women are strong, all the men are good looking, and all the children are above average."

Garrison Keillor, Lake Wobegone Days

Most performance measure in business are relative. Market share, growth rates, earnings. We benchmark against others all the time. But with NPS, many companies don't really know where they stand, and where they stand could be the ultimate measure of performance.

Several years ago, Bain and Company did some great research to understand how profit pools got divided up by industry, and how NPS played a role in that. They found that every industry had a “bright line”, an NPS score which separated winners from the pack, and that those who entered the winners circle (so to speak) enjoyed a disproportionate share of the profits in their industry. This shouldn't surprise anyone; in most industries profits are not linearly correlated to size or even market share. It's not a fair game - it turns out it's rigged in favor of NPS leaders.

What's really interesting to me, however, was that the bright line that separated the leaders was not uniform across all industries or geographies. Rather, it varied significantly by industry. This should come as no surprise: we usually see that Business to Business NPS results are often significantly lower and less variable than Business to Consumer. We also know that customers compare and formulate perspectives based on their expectations, which can vary according to prior experience and price. We teach customers what to expect in our industry, then we give them relative pricing to help set their expectations around our role as discounters or premium players.

Companies spend precious little time thinking about issues of comparable performance, which seems odd given its importance. After all, knowing what your score is only matters if you have some sense as to what it should be. This disconnect ripples through the corporation in multiple ways. Companies without a clear sense of NPS “situational awareness” will struggle to set appropriate goals, compensation metrics or process. I'd even go as far as to say that measuring NPS without a clear sense of target is worse than not measuring at all.

Part of the problem is the challenge around getting good benchmarks. We do publish benchmark data, so for those industries we cover, you can get an accurate sense of where you should be (and an independent view of where you are trending). But that data will never be detailed enough for some, so they often find themselves doing specific benchmarking studies. Others tell me that they make a benchmark of the data that is published in the book. While I agree it's aspirational to try and reach USAA's lofty NPS goals, it's probably neither feasible nor even desirable, assuming you are not a major insurance provider. Nor is it practical to simply target the top quartile and straight line trend your own NPS towards it as a goal setting technique. You are pretty much assured of falling short initially as NPS just doesn't improve in a straight line.

If you are determined to avoid detailed target setting and outside benchmarks, there is still hope. Stack ranked employee, or region or segment performance provides you with the opportunity to challenge the lower performing segments to raise their game to the average. That alone improves your score and starts moving you in the right direction; although it doesn't help you understand if your entire organization is on track for financial success.

One other thought. Absolute NPS does matter in one important way. Industries with low "threshold NPS" - a low target that gets you in the winner's circle - have fewer absolute promoters than those where only a high score wins. The absolute number of promoters can be thought of as word of mouth capacity, so their absence reduces the overall positive effect for industry participants and the industry in general. By all means, out-run the other guy for success, but to get real organic growth you still need an army of promoters.

“Three shall be the number thou shalt count, and the number of the counting shall be three. Four shalt thou not count, neither count thou two, excepting that thou then proceed to three. Five is right out.”

Instructions for the Holy Hand Grenade of Antioch - Monty Python*

We all spend a lot of time dealing with the sophistication of Net Promoter but it’s worth, on occasion, reminding ourselves of the merits of getting the basics right.

With this in mind, and with all humility, I offer my Five Laws of Net Promoter as a starting point for discussion. If we need a simple compass to program success, I hope this may help us stay on the right track. Or, you may decide that “five is right out”.

• The First Law of Net Promoter: You need to know your score, and it needs to be trustworthy
• The Second Law of Net Promoter: You must act immediately on customer feedback
• The Third Law of Net Promoter: You need to know how you rank against others
• The Fourth Law of Net Promoter: You need to understand what to do to improve your score
• The Fifth Law of Net Promoter: Your organization needs to be accountable for their score and improving it

Well, there you have it. Simple enough?

Let’s start today with The First Law of Net Promoter...

I will bet that any competitive manager who reads just about any article on NPS will have this question pop into their head: what’s our score? It’s part of our makeup to want to keep score and if you buy into the potential value of NPS, you are drawn to this question like an accountant to a GAAP** statement. For many companies this is where the pilgrimage starts and, for a sad few, where it ends. Because this deceptively simple first law is a bear to follow if you are really ready to trust your data.

Trustworthiness defies a numerical definition. Response rates don’t get you there: many consumer packaged goods companies make major decisions on the basis of 10 people in a focus group. If 9 out of 10 people in your largest account respond but the CEO doesn’t, you may still consider the data untrustworthy. And for skeptics, no customer data is good enough for decision making.

No, it’s a subjective measure. Your data is trustworthy when you are willing to make major decisions based upon it. And only you, or your management team, can figure out exactly where the bar is set. For some, the plural of anecdote is data – a handful of customer comments is sufficiently affirmative to drive a revolution in their business. For others, years of statistically sound data won’t get them there.

We do know that corporate data is a quagmire. Large sophisticated corporations whose CRM systems are chock full of inaccurate or outdated information and for whom customer profitability financials are out of sight – these are the rules, not the exceptions. 30 years of information technology have left us often more confused than when we started. For these companies, their Net Promoter data might, in fact, be the only data they can trust at all. At least they know there is a human being at the other end of the survey, and someone who cares enough about them to provide an opinion. I’ll take that over a GAAP statement any day.

So those are my thoughts on the First Law. Laws Two to Five to follow soon!

*”Five is Right Out” is a quote taken from Monty Python and The Holy Grail, a British comedy film from 1975 that takes an irreverent look at King Arthur and the Knights of the Round Table. The quote refers to the usage of the Holy Hand Grenade of Antioch. To use the grenade, you counted to three, before throwing it. Five was right out – as in too many numbers, too long a count. Other highlights of the film include the coconut-shell horses, the black knight, the knights of Ni and their fondness for shrubberies.

**GAAP: Generally Accepted Accounting Principles refers to the principles used in accounts throughout the U.S. The principles allow a fairer and simpler comparison between the financial positions of different companies. Several organizations contribute to the development of GAAP, most notably the Financial Accounting Standards Board. Though GAAP is not legally binding in itself, the Securities and Exchange Commission requires that all publicly-traded companies follow the principles.