Corporate America is skating on
the edge of prosperity and digging some very deep graves… or at least the CEOs
running the corporations are skating on ice right now.
And it has nothing to do with
China or Trump.
I was ready last night to
dedicate this blog writing to some key insights I gleaned from some campouts in
malls across the U.S., but upon reading this morning’s newspapers, I cannot
help but shift the focus to something overtaking corporate board rooms.
Here is the headline of one of
the articles…
“Much of Corporate America is
obsessed with NPS… a score that has developed a cult-like following.”
A Millennial digital marketing
geek that heads up marketing for one our media clients brought the topic up
back in 4th quarter 2018.
He called me and said he wanted
to get the research up and running by the first of the year.
As soon as he used the acronym, I
knew we were going to have some spirited discussion.
Not that I am a statistical Phd,
but there is no way that EXPERIENCE will ever, ever, ever implement this type
of “research.”
There are friends I have in
Atlanta, that regularly protest around the Emory Yerkes Primate Institute that
conducts medical experiments on apes and monkeys. They believe that the research violates basic animal rights.
NPS research violates fundamental
business missions, Wall Street investments and global economics.
The CEO of Delta airlines, an
Atlanta-based corporation, is quoted in the article saying this… “Our score has
averaged 50, up seven points over last year. This is the reason we’ve sustained the best revenue premium
in the industry.”
Now I am not an economic
forecaster or accounting expert, but I doubt that the Delta Score is why
Delta’s financials are positive.
At least the CEO is a positive
thinker with the perspective that the glass is half full. Not that I am a naysayer, but just as
much as the glass is half full, it’s equally half empty and that might be an
area of improvement focus.
So what is this “NPS” that I am
talking about?
The cult-followers refer to its
acronym – NPS – that stands for Net Promoter Score. The followers like to refer to is as a “customer
satisfaction rating.”
It’s a “like-ability rating”
survey question – one question – where customers rate their recent experience on
a 1-10 rating scale.
No further questions are
asked. Just one question.
In the last week, I have received
two NPS survey phone calls. I even
knew that one was forthcoming.
When I purchased a Jeep Cherokee
last week, the salesperson told me I was going to get a single question survey
call to rate my experience in purchasing the Jeep.
He went on to tell me that his
sales commission was dependent upon the rating I gave. He even told me that if I rated the
experience any lower than a “10” his commission would be cut to a lower
percentage.
The second call I got came in
from Target.
It came in within an hour after I
purchased some groceries at a Target just down the street from my Atlanta
home. The refrigerated items had
been unpacked, but the non-refrigerated items were still in bags on my kitchen
counter when the call came in.
The question was identical to the
call that came in from Jeep… “using a scale of 1-to-10 with 10 being excellent
and 1 being poor, how would you rate the likeability (I am not making that up)
of your most recent Target shopping experience?”
John Mulligan, Target’s COO is
quoted in the article saying, “Our most recent net promoter score for Drive-Up
is 88. A crazy high number, the
highest of any service we provide.
We expect to have this service rolled out to nearly 1,000 stores by the
holiday season.”
Wow.
One question delivering “a crazy
high number” that is going to drive a service roll out to nearly 1,000 stores.
And I guess the COO has the CFO
on the same bandwagon.
The WSJ article goes on to note
that “so many of the NPS surveys are sent to customers through Emails, web
pop-ups and phone calls, it has become harder to secure a representative
response rate.”
The article goes further with
“its hard for investors to interpret the scores because companies often
administer the surveys internally, get very low response rates, do not publish
margins of error and elect to internally adjust the ‘scores’ against cultural
bias.”
Okay.
Corporate business leadership
that is now making financial investment decisions driven by a single
like-ability question are living in la-la-land.
The headline for the article is
politically more correct than my commentary with “CEOs Embrace a Dubious
Metric.”
The CEOs of Best Buy, American
Express, Target, Delta Airlines, UnitedHealth, Google, Intuit and Citigroup are
all noted as cult-followers in the article.
Am I a loyal Apple Mac user?
Yes.
I have three MacBook Pros and two
iPhones. I have used an Apple
computer for more than 25 years now.
Do I “like” Apple and would I
give them a “10?”
Absolutely NOT. Maybe a “5” at best.
MacBooks cost 5 times more than
the corresponding PC. Microsoft
Office still cannot coordinate programs with Apple mechanics. The staffing at the Apple stores are
arrogant. Apple just got slammed
by the Supreme Court for hording the apps.
Does my “like-ability” of Apple
align with my likelihood to purchase another Apple product?
No.
It’s a love-hate relationship
that marriage counselors attempt to correct.
Did I give the Jeep salesperson a
“10.”
Yes.
Am I in a brand love affair with
the new Jeep.
No.
It’s nice, but there are a lot of
Jeep components built into the dash and the power limitations of the engine
that I do not find very like-able.
LOL… Did the one question ask me
to rate the product experience itself?
No.
We work with a retail client that
owns multiple store brands. I did
the mall campouts for this client that I will write about in the next blog
post.
The head of consumer insights is
a good guy. But when I asked him
how often he gets out in the field and visits the stores and has conversation
with customers, he told me in his 11 months on board, he has yet to get out
into the field.
CEOs that build their brand
kingdoms around comfort and internal mission statements are not likely to be
long standing.
If you are just now hitting the
EXPERIENCE website and reading this… or you clicked on the Blog link in our
Email signature and reading this… and you have concluded that EXPERIENCE is a
crazy group of non-MBA, corporate culture, brand endorsers and believe we are
not going to generate much return on your investment…
Email me and I will send you the
names of some of the firms quoted in the Wall Street Journal article that
actually are advocates of the NPS research. I will also send you the names and contact information for
some do-as-the-client-says ad agencies that you will find reinforce your
defined brand promotional needs.
If you read this and observe
quickly that the brands who are integrating this type of research that is
generating “crazy high numbers” are struggling with market maturity and limited
growth and you desire to avoid a similar brand situation, call us.
My goal is not to make this blog…
nor our client relationships “like-able.”
My goal is to drive brand growth
and bottom line return… to craft brand experiences that customers emotionally desire to seek out beyond rational thought… even when they don’t necessarily
fully like the brand!
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