Net promoter score (NPS), a customer loyalty metric that measures the willingness of consumers to recommend a product or service to others, is directly linked to revenues of service providers.
A recent study, conducted in May by analyst firm Coleman Parkes showed that 88% of consumers indicated that they would increase spending with their service provider by almost one third if they received better service.
Around 84% also stated they would be happy to recommend their service provider to family and friends, thus reducing the cost of customer acquisition.
"This type of research helps quantify the link between customer loyalty (NPS) and profitable growth," said Fred Reichheld, founder of Bain & Company's Loyalty Practice and creator of the net promoter system of management. "The results provide a clear message to the industry: improve customer service if you want to grow."
Results of the survey, which was sponsored by Amdocs, however, revealed that service provider NPS remains very low, with the NPS of wireless telecom companies averaging only reach minus 3.2%. Industries with good NPS typically score 30-50%.
Meanwhile, nearly three-quarters (73%) of consumers have complained about their service provider on social media on average six times in the last 12 months. Consumers mostly used their own Facebook page to complain (45%), followed by Twitter (26%) and service providers' own Facebook pages (25%).
More positively, half of all consumers (49%) said they would switch to a service provider if recommended by friends and family, based on a poor experience.