Why American Express Still Cares About Net Promoter Score

Learn how American Express’ Derek Martin and other high-level customer thought leaders parlay customer insight into business success—get details on the 2011 Customer Insight Week!

Whereas "metrics" and "benchmarks" have historically helped pique interest in customer management discussions, they have recently captured a stigma. The trend these days is for thought leaders to explain why performance measures are not that relevant to the overall customer experience.

Net Promoter Score is one such metric—it is a customer loyalty measure that has come under fire for its limitations.

In this exclusive CustomerManagementIQ.com podcast, Derek Martin, American Express’ director of global consumer card sales, retention capabilities and strategies acknowledges some limitations of the measure.

Yet on the point blank question of whether it matters to the customer management function, he sides with the power of metrics.

"Yes, [customer management professionals] really should care," explains Martin. "I think net promoter is incredibly valuable."

For Martin and American Express, NPS is far from a vanity metric and instead one that has correlated with significant improvements to the customer experience and the business’ bottom line.

"People who say you can’t correlate the data to actual revenue items—it’s not true, at least not in my case," says Martin. "I can show you data that says that as net promoter score rises, customers spend more money, they’re more loyal, they’re putting more dollars on an American Express card, and they’re leaving us less.

"I can show you, and I have four years of data to show it."

Even without that data, Martin would still see reason to back NPS as a contained-customer loyalty metric.

"Customer satisfaction obviously is directly related [to NPS]," confirms Martin. "Then from an employee perspective, think about a company that’s healthy and that has happy customers--I would urge you to consider that employees want to work at those places. They want to work at Zappos."

Recent trends, in fact, suggest NPS will become even more important.

Why does Derek Martin think NPS is about to become "the core measure going forward for businesses?" And, at the same time, what would he recommend to improve upon some of the limitations? Get these answers and more in the new CustomerManagementIQ.com "Customer Creation" podcast.

How do you feel about NPS? What metrics should you be using in your customer experience function? Benchmark against the best at Customer Insight Week!