In this post we explore the Net Promoter Score, an indicator of the likelihood of members to recommend membership of their association to others, as well as the contributing factors common to those that endorse membership in their association.
Now widely used in the US by successful associations to measure the likelihood of their members to recommend them, the Net Promoter Score (NPS) was devised by Fred Reichheld, Satmetrix and Bain & Co to measure customer loyalty, in particular “what is the likelihood you would recommend ‘x’ to a friend or colleague?”.
By giving a numerical value to the response a quantifiable measure of both positive and negative ‘word of mouth’ can be determined.
To obtain a NPS score, respondents are asked to rate their likelihood to recommend on a scale of 0 -10 (with zero being extremely unlikely and 10 being extremely likely). Based on their responses The Net Promoter methodology divides members in to three groups:
- Promoters (Score 9-10) are loyal enthusiasts who will maintain their membership and refer others
- Passives (Score 7-8) are satisfied but unenthusiastic members
- Detractors (Score 0-6) are unhappy members who may provide negative word of mouth.
The Net Promoter Score is calculated by subtracting the percentage of the detractors from the percentage of the promoters.
Why is it important?
While the Association Matters Study determined that younger members are most likely to learn about a professional association through their educational institution, a large proportion of association members (nearly 25% overall) first hear about their association through colleagues or friends.
With personal recommendations likely to be an influential factor in individual’s decision making, the power of word of mouth on association’s renewals cannot be underestimated.
And as only members who feel their organisation provides value are likely to make recommendations, ensuring members are satisfied and inclined to provide positive word of mouth is critical for associations to grow their organisation through new member recruitment.
What prompts individuals to recommend?
So what are the key factors that would drive a member to recommend their association to others? The addition of an open ended question to the NPS rating system asking members to provide the reason for their score provides this information.
With more than 5,500 answers to this question, the Associations Matter Study provides vitial insight into the factors that are important in members’ decisions to recommend their association. And our analysis of these responses suggests that the main reasons include a belief that the association:
- fosters their connections and professional networks;
- enhances their credibility;
- is the leading source of knowledge and best practice in the industry; and
- is a strong advocate for the profession.
A selection of the comments of Promoters (members giving their association a score of 9 -10) include:
"I have great loyalty to the association and am extremely appreciative of what they do in terms of advocacy and provision of professional development and networking opportunities"
"I strongly believe in professional association membership as a way of maintaining professional accountability and consistency of practice, as well as providing a forum for advocacy on behalf of its members."
"It is a fantastic industry association that keeps members informed about news relating to the industry on a regular basis."
And what about the detractors?
Similarly, the Association Matters Study provides significant insight into the factors common to those members who are less likely to recommend their association to others. These include a belief that the association:
- does not offer value for money;
- does not offer events and services of sufficient quality;
- does not adequately represent members; and
- provides little more than (mandatory) membership
A selection of the comments of Detractors (members giving their association a score of 0-6) include:
"No clear benefits. Membership out of sense of duty more than anything else."
"Their thinking is in the past and many of their services are available outside the organization at a cheaper price."
"They are a pretty non-existent professional body, almost zero visibility of advocacy work undertaken."
The way forward
The overall Net Promoter Score from the Associations Matter: 2013 State of the Sector Study was 2. This is based on 31% of associations’ members being promoters of their association, and 29% being classified as detractors.
Whilst is useful to measure your association’s performance against this industry benchmark, it is also beneficial to compare your own association’s NPS over a period of time.
The most successful associations measure their Net Promoter Score on an annual basis and aim to improve their score each year, using the information to implement changes that convert a greater percentage to ‘promoters’ thereby maximising retention and new member growth.