Metrics need to evolve.
The “how likely are you to recommend” question has enjoyed widespread adoption as a customer experience metric because it is a simple measurement that is readily understandable to internal and external stakeholders. Since it was introduced over ten years ago, it has:
- Brought more attention and focus to the importance of the customer in a growing business
- Brought more attention and focus to the power of positive word of mouth as a driver of growth
- Framed the concept of customer satisfaction in a way that was easy and simple for company leaders to understand
However, asking your customers how likely they are to recommend your brand, products or services is fundamentally flawed because it assumes non-recommenders are detractors. In the real world, people decide to recommend or not recommend a product or company for a number of reasons–and just because someone says they’re not likely to recommend does not automatically make them a detractor.
WoMI is innovating analytics.
In a ForeSee survey of more than 20,000 consumers that had been labeled “detractors” by the likelihood to recommend question alone, only 1% said they would be likely to communicate a bad experience – meaning the other 99% were passive detractors. ForeSee’s analysis also found that 60% of those so-called “detractors” were actually loyal customers, indicating they had paid for the company’s services for two years and would continue to do so in the future.
Thus, ForeSee developed the Word of Mouth Index (WoMI). ForeSee tested and refined WoMI over a two-year period with more than 300 companies and through nearly 1.5 million customer surveys. The result is a much deeper and more precise categorization of active promoters and detractors.
WoMI does this by augmenting the “How likely are you to recommend?” approach with a second question: “How likely are you to discourage others from doing business with this company?” WoMI then subtracts the percentage of 9 and 10 ratings from “likelihood to discourage” from the percentage of 9 and 10 ratings from “likelihood to recommend” to arrive at the balanced and accurate WoMI score.
In the process of conducting these studies, ForeSee used its “likelihood to discourage” data to evaluate the “likelihood to recommend” scores of the companies participating in its analysis and found that the single-question approach overstates detractors, often by enormous amounts. The overstatement of detractors can be calculated using the following formula:
To play this out in practical terms, suppose a company has 30% detractors as defined by the “how likely are you to recommend” question (the percentage of 1-6 ratings), and 10% detractors as defined by WoMI (the percentage of 9-10 ratings to the discourage question).
Why is this significant? Because executives use the percentage of detractors as defined by the likelihood to recommend question as a KPI for evaluating investments and other business decisions. If you believe 30% of your customer base is made up of active detractors, but really it’s only 10%, then you may very well invest significant money and manpower into trying to “convert” detractors who simply do not exist.
Detractors are overstated: WoMI Scores
ForeSee continues to conduct extensive research to collect satisfaction, WoMI, and traditional “promoter” scores for hundreds of private companies across industries. See how much using only the “how likely are you to recommend” question overstates detractors for the top 100 brands, and how your industry stacks up.