Why is NPS the standard bearer for measuring the customer experience?

When people find out our business focusses on customer experience research and strategy, they often think we do Net Promoter Score (NPS) research.  This is a concern, because customer experience (and the research in the space) is so much, much more than affecting the NPS. 

With NPS having gone so mainstream, it has become an objective in and of itself.  I think this is a problem.  Because simply aiming to improve NPS has no underpinning - how or why are you doing it?  And what if you’re already performing well, how do you improve further?

The objective of improving the customer experience surely has to be a business benefit:

  • Reducing customer churn
  • Improving the cost per acquisition
  • Reducing ‘cart’ abandons
  • Increasing frequency of purchase
  • Reducing call center volume
  • Create new leads (through customer advocacy)

Of course, we want our customers to be happy with our product or service. But what's the point of wasting resources on improving the experience, if you’re not having a commercial impact.   Which brings me back to NPS.   Simply improving an NPS score and being KPI’d on that has no direct correlation to the business objectives above.  It reminds me a of a conversation with a General Manager I had last year around brand awareness.  Remember awareness, consideration and preference are often the measures businesses use to justify marketing expenditure.  This is an approximation of what he said:

“In the best will in the world Will, I don’t give a rat’s **** about whether my advertising awareness is going up, what I want to know is whether the money I spend on advertising is increasing sales” 

That’s the truth, when it comes to advertising, you invest in it, because it correlates with an increase in sales. You don’t spend money on advertising just to improve awareness, that’s not going to help you sell more product and keep your staff employed. 

I’m fairly sure, NPS is the same.  It’s a measure, and it’s great to see improvements, but I wonder if it's too removed from the business, in the same way advertising awareness is from actual sales.  Of course, it’s not always easy to measure and directly attribute CX improvements to some of the business objectives described.  But it certainly helps with asking better questions, like “how can we reduce churn”, “how can we increase customer advocacy?”, “How can we reduce call center call volume?” rather than "how can we improve our NPS?"

What do you think?