Net Promoter Score Fails the Test

Sharp, Byron
December 2008
Marketing Research;Winter2008, Vol. 20 Issue 4, p28
Academic Journal
The article offers opinions on marketing research. The Net Promoter Score, a research metric on customer retention created by consultant Frederick Reichheld, is evaluated. Reichheld's claim that a corporation which could increase its retention rate by five percent could increase profits 100 percent is viewed as invalid and without statistical foundation. It is stated that increasing customer retention actually involves decreasing the rate of customer defection, a process which is largely beyond management's control. Customer defection is said to be dependent on market share and the number of competing brands in a particular market, meaning that defection rates as a measure of brand loyalty are almost impossible to alter permanently.


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