Consumer Growth: The Curious Case of Vanity Metrics
Unlocking True Growth with Net Promoter Score (NPS)
As an experienced growth expert, you’ve likely danced with vanity metrics — the flashy numbers that dazzle but don’t necessarily drive business success. For me, I’m tilted towards one ultimate metrics that should always be on point if you want to drive growth for your company — NPS. So, let’s shift our spotlight to a metric that transcends the superficial: the Net Promoter Score (NPS).
What Are Vanity Metrics?
Vanity metrics are like glitter — pretty to look at, they make you feel really good, but they don’t hold much substance. Think follower counts, likes, and comments. Sure, they make your social media profile sparkle, but do they move the needle? Not necessarily.
It is also a good point to mention that vanity metrics could come into play per time. For e.g., if the metric you are currently amazed about right now does not ultimately add value to your quality KR, which is a cut out from the whole company KR, then you’re looking at the wrong number.
The NPS Revolution
NPS — a metric that cuts through the noise and gets straight to the heart of customer loyalty. Developed by Fred Reichheld in 2003, NPS measures the likelihood of customers recommending your product or service to others. It’s not just about satisfaction; it’s about advocacy.
Why NPS Matters
- Predictive Power: NPS isn’t a crystal ball, but it comes close. Research shows that companies with high NPS tend to experience faster revenue growth. It’s like having a GPS for business success.
- Customer-Centricity: NPS shifts the focus from transactions to relationships. It’s not about selling more alarm clocks; it’s about creating clock enthusiasts who spread the word.
- Setting Up NPS: Let’s get practical. Here’s how you can set up an NPS survey:
- Email Surveys: Craft a simple survey asking, “How likely are you to recommend [xxx product] to a friend or colleague?”
- On-Site Surveys: Pop-up surveys on your website or platform or app, work wonders. Ask the same NPS question right where users engage with your brand.
4. Calculating NPS: The magic lies in the math. Subtract the percentage of detractors (0–6) from the percentage of promoters (9–10). Voilà! Your NPS score reveals whether you’re winning hearts or losing ground.
Understand NPS from all angles. After all, growth isn’t one-size-fits-all.
Beyond the Score: Nurturing Advocacy
Now, double clicking the hidden potential of NPS:
- Referral Goldmine: Those promoters? They’re your secret weapon. Engage them. Encourage them. Empower them to refer friends, family, and even foes (yes, foes — sometimes they convert too! 😁).
- Personal Invitations: Imagine a loyal customer inviting their network to join your tribe. NPS helps you identify these brand evangelists. Reach out personally. Say, “Hey, chief enthusiast, want to share the love?”
- Amplify Referral Programs: NPS fuels your referral engine. Target the right advocates. Give them incentives. Watch your growth soar.
References and Further Reading
While the HBR book “Strategic Marketing” provides solid insights, don’t stop there.
So, dear growth expert, turn loyal customers into brand ambassadors. Let your NPS score be the compass guiding you toward sustainable growth.
