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Investigating relationship between NPS and subscribers
A Study in Pakistani telecom companies perspective
Authors:
Muhammad Farooq*
Dr. Asif Khurshid
*CLM Analyst Telenor, PhD Candidate, Department of Management Sciences, COMSATS Institute of Information Technology,
Islamabad.
**Assistant Professor, Department of Management Sciences, COMSATS Institute of Information Technology, Islamabad.
Introduction
Most Valuable Customers for every organization
• Those who Buy more
• Those who Recommend to others
Traditional Business concept
New business Concept
Telecom sector in Pakistan
Literature Review
Reichheld, (2003)
NPS founder -In his paper (Reichheld, 2003), “The One Number You Need to Grow”, Fred
Reichheld emphasized the strong association between a company's development rate and its
Net Promoter Score in most economical businesses.
Meyer, (2008)
Net Promoter scores for goal setting and engaging the organization’s attention, though he
distinguishes that a rising or falling score doesn’t begin to reveal what is driving the trend.
Feed that information back to the organization regularly
Jean (2011)
The NPS calculates the difference between promoters and detractors. This ease of execution
has encouraged managers extensively to implement this new metric
Aksoy, Cooil,
Andrsen and
Williams, 2008)
have pointed out that NPS was not always the best indicator for predicting corporate
revenue growth, and results varied by industry.. Empirical evidence has emphasized the
NPS' relevance in the telecommunications Industry
Morgan and Rego,
(2006)
NPS is a clear sign of consumers' changing opinions over a given period of time as compared
to their initial choice.
Methodology
Population All Telecom Subscribers in Pakistan
Unit of Analysis Individual Subscribers
Contact Method Email, Facebook, LinkedIn
Contact Method Email, Facebook, LinkedIn
Sample
Selection
Subs Number, Email ID
Sample
Distribution
Subs Number, Email ID
Sampling
Technique
Quota Sampling
Results
Results
Managerial & Theoretical Implications
Young influencers
Micro-segmentation: Top down and bottom up strategy
Thank You
Back Up Slides
• 1. Measuring Usability, 2012, Predicting Net Promoter Scores from System
• Usability Scale Scores, available at: http://www.measuringusability.com/blog/
• NPS-sus.php
• 2. Pakistan telecommunication authority, home page, available at: http://www.pta.gov.pk/index.php?Itemid=1
• 3. Anderson, N. H. (1965). Averaging versus adding as a stimulus-combination rule in impression
formation. Journal of Personality and Social Psychology, 2,1-9.
• 4.Arndt, J. (1967). Perceived Risk, Stoichiometric Integration, and Word-of-Mouth in the Adoption of a
• 5.NewFood Product. In Cox, D. (Ed.) Risk Taking and Information Handling in Consumer Behavior
• (pp. 289-316). Boston: Graduate School of Business Administration, Harvard University.
• 6.Brown, K. (2004). Holding onto customers. Wireless Week, 15, 6.
• 7.Bolton, R. N., & Bronkhorst, T.M. (1995). The relationship between customer complaints to the firm
• and subsequent exit behavior.Advancesin Consumer Research, 22(1), 94–100.
• 8.East, R. & Olmo Riley, F. D. (2002). Positive and negative word-of-mouth influence. Kingston
• University paper presented at Australian and NewZealand Marketing Academy Conference.
• 9.Forrester (2007). Forrester's Marketing Forum: Reinventing Customer Centricity. April 11-12 Miami,
• FL.
• 10.Galor, O. & Zeira, J. (1993). Income Distribution and Macroeconomics. The Reviewof Economic Studies,60,35-52.
• 11.Herr, P. M., Kardes, F.R. & Kim, J. (1991). Effects of word of mouth and product-attribute
• Information on persuasion: Anaccessibility diagnosticity perspective. Journal of Consumer
• Research, 17,454-62.
• 12.Heskett, J. L., Sasser,W. E., & Schlesinger L. A. (1997). The Service Profit Chain: How Leading Companies Link Profit and Growth to Loyalty, Satisfaction, and Value.
Simon and Schuster: New
• York.
• 13. Heskett, J. L., Jones, T. O., Loveman, G. W., Sasser, W. E.Jr., &Schlesinger L. A. (1994). Putting the service-profit chain to work. Harvard Business Review, March-
April,163-174.
• Ittner, C. D., & Larcker D. F.(1998). Are nonfinancial measures leading indicators of financial
• performance? An analysis of customer satisfaction, Journal of Accounting Research, 36,1-35.
• 14.Kroloff, G. (1988). At home and abroad: Weighing in. Public Relations Journal, 44,8-10.
• Marsden, P., Samson, A., & Upton, N., (2005). Advocacy drives growth: Customer advocacy drives UK
business growth, Brand Strategy 198, 45-48.
• 15.McGregor, J. (2006). Would You Recommend Us? That simple query to customers is shaking up
planning and executive pay. Business Week article retrieved online at:
www.businessweek.com/magazine/content/06_05/b3969090.htm on 8/4/2008.
• 16. Mize ski, R. W.(1982). An attribution explanation of the disproportionate influence of unfavorable
information. The Journal of Consumer Research, 9,301-310.
• 17. Reichheld, F.(2003). The one number you need to grow. Harvard Business Review, December,
• 2003.
• 18. Richey, M. H., Koenig’s, R. J., Richey, H. W., & Fortin R. (1975). Negative salience in impressions of
character: Effects of unequal proportions of positive and negative information. Journal of Social Psychology,
Dec. (Second Half): 233-41

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Investigating relationship between nps and subscribers

  • 1. Investigating relationship between NPS and subscribers A Study in Pakistani telecom companies perspective Authors: Muhammad Farooq* Dr. Asif Khurshid *CLM Analyst Telenor, PhD Candidate, Department of Management Sciences, COMSATS Institute of Information Technology, Islamabad. **Assistant Professor, Department of Management Sciences, COMSATS Institute of Information Technology, Islamabad.
  • 2. Introduction Most Valuable Customers for every organization • Those who Buy more • Those who Recommend to others Traditional Business concept New business Concept Telecom sector in Pakistan
  • 3. Literature Review Reichheld, (2003) NPS founder -In his paper (Reichheld, 2003), “The One Number You Need to Grow”, Fred Reichheld emphasized the strong association between a company's development rate and its Net Promoter Score in most economical businesses. Meyer, (2008) Net Promoter scores for goal setting and engaging the organization’s attention, though he distinguishes that a rising or falling score doesn’t begin to reveal what is driving the trend. Feed that information back to the organization regularly Jean (2011) The NPS calculates the difference between promoters and detractors. This ease of execution has encouraged managers extensively to implement this new metric Aksoy, Cooil, Andrsen and Williams, 2008) have pointed out that NPS was not always the best indicator for predicting corporate revenue growth, and results varied by industry.. Empirical evidence has emphasized the NPS' relevance in the telecommunications Industry Morgan and Rego, (2006) NPS is a clear sign of consumers' changing opinions over a given period of time as compared to their initial choice.
  • 4. Methodology Population All Telecom Subscribers in Pakistan Unit of Analysis Individual Subscribers Contact Method Email, Facebook, LinkedIn Contact Method Email, Facebook, LinkedIn Sample Selection Subs Number, Email ID Sample Distribution Subs Number, Email ID Sampling Technique Quota Sampling
  • 7. Managerial & Theoretical Implications Young influencers Micro-segmentation: Top down and bottom up strategy
  • 9. Back Up Slides • 1. Measuring Usability, 2012, Predicting Net Promoter Scores from System • Usability Scale Scores, available at: http://www.measuringusability.com/blog/ • NPS-sus.php • 2. Pakistan telecommunication authority, home page, available at: http://www.pta.gov.pk/index.php?Itemid=1 • 3. Anderson, N. H. (1965). Averaging versus adding as a stimulus-combination rule in impression formation. Journal of Personality and Social Psychology, 2,1-9. • 4.Arndt, J. (1967). Perceived Risk, Stoichiometric Integration, and Word-of-Mouth in the Adoption of a • 5.NewFood Product. In Cox, D. (Ed.) Risk Taking and Information Handling in Consumer Behavior • (pp. 289-316). Boston: Graduate School of Business Administration, Harvard University. • 6.Brown, K. (2004). Holding onto customers. Wireless Week, 15, 6. • 7.Bolton, R. N., & Bronkhorst, T.M. (1995). The relationship between customer complaints to the firm • and subsequent exit behavior.Advancesin Consumer Research, 22(1), 94–100.
  • 10. • 8.East, R. & Olmo Riley, F. D. (2002). Positive and negative word-of-mouth influence. Kingston • University paper presented at Australian and NewZealand Marketing Academy Conference. • 9.Forrester (2007). Forrester's Marketing Forum: Reinventing Customer Centricity. April 11-12 Miami, • FL. • 10.Galor, O. & Zeira, J. (1993). Income Distribution and Macroeconomics. The Reviewof Economic Studies,60,35-52. • 11.Herr, P. M., Kardes, F.R. & Kim, J. (1991). Effects of word of mouth and product-attribute • Information on persuasion: Anaccessibility diagnosticity perspective. Journal of Consumer • Research, 17,454-62. • 12.Heskett, J. L., Sasser,W. E., & Schlesinger L. A. (1997). The Service Profit Chain: How Leading Companies Link Profit and Growth to Loyalty, Satisfaction, and Value. Simon and Schuster: New • York. • 13. Heskett, J. L., Jones, T. O., Loveman, G. W., Sasser, W. E.Jr., &Schlesinger L. A. (1994). Putting the service-profit chain to work. Harvard Business Review, March- April,163-174. • Ittner, C. D., & Larcker D. F.(1998). Are nonfinancial measures leading indicators of financial • performance? An analysis of customer satisfaction, Journal of Accounting Research, 36,1-35.
  • 11. • 14.Kroloff, G. (1988). At home and abroad: Weighing in. Public Relations Journal, 44,8-10. • Marsden, P., Samson, A., & Upton, N., (2005). Advocacy drives growth: Customer advocacy drives UK business growth, Brand Strategy 198, 45-48. • 15.McGregor, J. (2006). Would You Recommend Us? That simple query to customers is shaking up planning and executive pay. Business Week article retrieved online at: www.businessweek.com/magazine/content/06_05/b3969090.htm on 8/4/2008. • 16. Mize ski, R. W.(1982). An attribution explanation of the disproportionate influence of unfavorable information. The Journal of Consumer Research, 9,301-310. • 17. Reichheld, F.(2003). The one number you need to grow. Harvard Business Review, December, • 2003. • 18. Richey, M. H., Koenig’s, R. J., Richey, H. W., & Fortin R. (1975). Negative salience in impressions of character: Effects of unequal proportions of positive and negative information. Journal of Social Psychology, Dec. (Second Half): 233-41