The Net Promoter Score (NPS) has become the golden metric for CX teams to measure the pulse of customer loyalty. But what happens when that pulse weakens? Too often, organizations meticulously track NPS, only to find themselves at a loss when the score dips. They know what happened, but not why. They’re left staring at a number, disconnected from the rich insights contained in customer feedback that could hold the answers.
The Problem: Knowing the “What,” Not the “Why”
The disconnection between NPS and pinpointing the issues negatively impacting customer sentiment was the central theme of our recent webinar “Why NPS Declines and How to Fix It,” featuring CX experts from Tagado and Octagon Square. The consensus? Traditional NPS measurement, while valuable, is inherently limited.
NPS tells you the what, not the why. As Matt Webb, a CX leader specializing in travel and hospitality, and founder of Octagon Square, pointed out, “A leading international hotel chain I was working with had an incredibly engaged customer base with a 40% survey response rate. The problem was we were really only able to report ‘was the hotel meeting its NPS targets, or was it not?’. There was no way for us to accurately gain insights from customer feedback to truly contextualize what was driving satisfaction or dissatisfaction.”
The Challenge: Extracting Insights from Customer Feedback
Poll results conducted during the webinar revealed three major issues CX teams face when dealing with customer feedback:
- Identifying actionable insights
- Turning feedback into meaningful actions
- Gaining timely insights feedback
These challenges all stem from an over-reliance on the surface-level NPS number and a lack of effective feedback analysis tools to delve deeper into feedback for answers.
Manual analysis, the traditional approach, is slow, cumbersome, and prone to bias. Matt shared a stark example from his experience with the major hotel brand he worked with: “We spent months creating an in-house model to better understand customer sentiment. We were analyzing individual words, classifying them as positive or negative, and mapping them to broader themes. In the end, we had reams of spreadsheets but this turned into a web of unmanageable data that was neither scalable nor reliable.”
Sound familiar? This painstaking process, while well-intentioned, often yields inconsistent results and leaves organizations scrambling for answers when leadership inevitably asks, “Our NPS is down, what happened?”
The Solution: Unlocking the True Potential of NPS
To transform unmanageable levels of customer feedback into accurate and actionable insights, an increasing number of organizations are turning to AI-powered feedback analysis to unlock the reasons behind movements in their NPS metric.
AI can process massive volumes of feedback instantly, identifying trends that would take human analysts weeks to uncover. This enables CX teams to quickly pinpoint the root causes of dissatisfaction, categorizing issues into actionable themes and measuring their direct impact on NPS. Crucially, AI reduces human error and bias, ensuring a more objective and data-driven approach. And perhaps most powerfully, it provides real-time alerts on emerging trends, allowing CX teams to proactively address customer pain points before they escalate and impact the bottom line.
Real-World Results: AI in Action
A major sleep product manufacturer and retailer used Tagado’s AI-powered feedback analysis to identify “NPS drags” and discovered a surprising issue: customers were hesitant to open their doors for delivery personnel in unbranded uniforms and unmarked vans. A simple change, involving uniforms and branded trucks, resulted in a measurable NPS increase.
Shutterfly, a leading provider of personalized photo products and services, also struggled to pinpoint specific customer needs quickly enough to take meaningful action. Tagado’s powerful “issues” feature enabled them to analyze the influx of feedback and identify emerging trends in real time. This helped Shutterfly uncover key insights, such as a growing demand for specific photo formats and a need for more diverse religious Christmas card options.
By leveraging these real-time insights, Shutterfly was able to prioritize the development and offering of the requested photo formats and expanded their selection of religious Christmas cards. This proactive approach, driven by Tagado’s analysis, directly translated into improved customer satisfaction and a significant increase in revenue during the crucial holiday season.
Matt’s hotel brand also experienced a dramatic transformation after implementing Tagado. The hotel chain gained real-time, data-backed insights into guest sentiment, created actionable strategies to address root causes, and improved retention and satisfaction by demonstrating responsiveness to customer concerns.
“Tagado helps us contextualize NPS results,” Matt explained, “allowing us to pinpoint areas that need improvement and take targeted corrective action. More importantly, it builds trust because customers see that we are actively listening and acting on their feedback.”
Key Takeaways: Moving Beyond NPS
So, what are the key takeaways for CX teams looking to move beyond simply tracking NPS and actually improving it?
- Pinpoint Root Causes: Leverage AI to go beyond the surface-level score and identify the specific drivers behind NPS changes.
- Take Faster Corrective Actions: Reduce analysis time from weeks to real-time insights, enabling swift responses to customer concerns.
- Increase Retention and Loyalty: Address customer pain points proactively to boost satisfaction and foster long-term loyalty.
- Link CX to Business Outcomes: Make data-driven decisions that align customer experience with overall business goals.
- Drive Impactful Change Across Teams: Empower marketing, operations, and customer service teams with real-time AI insights to facilitate collaborative action.
NPS is a valuable metric, but it’s just a starting point. To truly understand and improve customer satisfaction, CX teams need to embrace the power of AI. By transitioning from manual, spreadsheet-driven analysis to AI-powered, real-time insights, organizations can unlock the hidden stories within their customer feedback, respond with agility, and build stronger, more profitable customer relationships. It’s time to move beyond the score and delve into the rich, actionable insights that AI can provide.
