Net Promoter: A Longitudinal Examination

In our May issue, Tim Keiningham, Senior Vice President and Head of Consulting discussed a paper he co-authored with a team of loyalty experts -- Lerzan Aksoy (Koз University), Bruce Cooil (Vanderbilt University), and Tor Wallin Andreassen (Norwegian School of Management) -- that takes an in-depth examination of the claims made by Net Promoter.

Now, that paper appears in the July issue of the Journal of Marketing and is available for download from the American Marketing Association.

Download "A Longitudinal Examination of Net Promoter and Firm Revenue Growth"

Managers have widely embraced and adopted the Net Promoter metric, which noted loyalty consultant Frederick Reichheld advocates as the single most reliable indicator of firm growth compared with other loyalty metrics, such as customer satisfaction and retention. Recently, however, there has been considerable debate about whether this metric is truly superior. This article employs longitudinal data from 21 firms and 15,500-plus interviews from the Norwegian Customer Satisfaction Barometer to replicate the analyses used in Net Promoter research and compares Reichheld and colleagues' findings with the American Customer Satisfaction Index. Using industries Reichheld cites as exemplars of Net Promoter, the research fails to replicate his assertions regarding the "clear superiority" of Net Promoter compared with other measures in those industries.

Tim Keiningham, Senior Vice President and head of consulting for Ipsos Loyalty, co-authored the paper with Bruce Cooil, Professor of Management with the Owen Graduate School of Management at Vanderbilt University, Tor Wallin Andreassen, Professor of Marketing in the Department of Marketing at the Norwegian School of Management, and Lerzan Aksoy, Assistant Professor of Marketing with the College of Administrative Sciences and Economics at Koз University in Turkey.