Net Promoter Score: ALiterature Review andPerspectiveACSI American Customer Satisfaction Index Leming index for customer loyalty/satisfaction until Main aspects一 Overall satisfaction-Expectancy disconfirmation一 Actual performance vs. the ideal Main competition is NPSFor more information on ACSI, visit wvwUheacsLQ电For an example see Turel (2004), AppendixWhat is NPS? Based on “recommend intentiorT一 How likely is it that you will recommend us to a friend or colleague?=0 to 10 Net Promoter Score=% promoters (9-10) minus % detractors (0-6) Increasing promoters and decreasing detractors is key to growthReichheld (2003)Controversy over NPS Debate over NPS as “the ultimate question has surfacedCritics (Keiningham et al.) Supporters (Reichheld)Weaknesses of NPS Not informative, not useful when it stands alone Not the besf predictor of growth Too simplistic to represent all facets of customer loyaltyKeiningham (2007)Other Issues with NPS Not the cause of growthan indication Categorization of customers is broad NPS=40Brandt (2007), Mitchell (2008)In a nutshell.This is not to discount their importance, but to point to the fact that any single metric designed to explain customer behavior across a diverse customer base is unlikely to be an adequate gauge upon which managers can act.Keinijngham et al. (2007, p.378)Strengths of NPS* Excellent starting point Identifies most valuable customers Standard question and scale It makes sense and it works (with feedback)Cardis (2008), Anstead (2008), Blasberg et al. (2008) Mortimer (2007), Martin (2008)#Just ask: does it make logical, common sense to you ? Yeah, it does.Reichheld，in an interview with Mortimer (2007)#Implementation of NPS A philosophy Some sectors discussed moreRitson (2007), Auda (2007), Tiltman (2007), Reichheld (2003)#NPS and Financial Services Financial services consistently have lower NPS compared to other sectors NPS highly strongly related to revenue growth for bankingsingle most reliable predictor 4 key drivers of NPS in ban kingTiltman (2007), Keiningham (2007), Brandt (2007)#What does NPS mean for financialservices? Long-term strategy Non-traditional (i.e. online) banks have grown rapidly and have higher NPS Interpret NPS carefully Stay invested in mission for satisfied customers12Brandt (2007)How to Use NPS Effectively Know your customers and what they want Follow up Collect data regularly Act on feedbackMittal & Kamakura (2001), Blasberg (2008), Nicks (2006)The Bottom Line NPS is a jumping off point-Tells you how many promoters and how many detractors you have一 Allows for comparison relative to other companies一 Serves as gauge for customer loyalty . but follow-up is a must-Future Research NPS in the B2B contextNPS in financial services other than bankingReferencesAnstead, M. (2008) How & why to use net promoter scores. Credit Union Journal, 18 February: 8.Auda, M. (2007) Net promoter score: What is it and should your company be using it? MRPerspectives: Emerging Trends, Topics, and Best Practices in Market Research, 22 June.Blasberg. J，Vishwanath. V., & Allen, J. (2008). Tools for converting consumersinto advocates. Strategy & Leadership. 36(2). 16-23.Brandt, D. R. (2007). For Good Measure. Marketing Management 20-25.Cardis, P. (2008) A score worth keeping. Professional Builder. January.Gigliotti, A., Meyers, J., Morgan, N. A., Pingitore, G，& Rego, L. L. (2007). NPS not the only way. Marketing News, 15 September: 48.Keiningham, T. L., CooiL B., Andreassen, T. W,& Aksoy, L.(2007a). A Longitudinal Examination of Net Promoter and Firm Revenue Growth. Journal of Marketing 刀(3): 39-51.Martin, J. (2008). Get customers to sell for you. FSB: Fortune Small Business, 78(5).Mittal, V，& Kamakura, W.A. (2001). Satisfaction, repurchase intent, repurchase behavior: Investigating the moderating effect of customer characteristics. Journal of Marketing Research, 38. 131-142.Mitchell, A. (2008). The only number you need to know does not add up to much. Marketing, 3 June: 22.Mortimer, R, (2007). Reichheld rates reputation. Brand Strategy. October.Nicks, S. (2006). What not to do with net promoter. BusinessWeek Online, 1 August:12.Reichheld, F. (2003). The one number you need to grow. Harvard Business Review、December: 1.Ritson, M. (2007). Simple, a bit sloppy, but not stupid. Marketing, 5 September.Thompson, B. (2007). Find the ”ultimate” loyalty metric to grow your business Customer Think: Customer-Centric Business Strategy. 1 October.Tiltman, D. (2007). The only question you need to ask. Marketing. 21 February: 30-32,Turel, O. (2004). User satisfaction with mobile services in Canada. Proceedings of the Third International Conference on Mobile Business, M-Business