Whether you're a follower of Vilfredo Pareto or Seth Godin (or both) you know that in every market there is a small group of customers who provide most of the profit. This group is typically described as loyal - but actually defining loyalty or measuring is much less clearcut.
Many loyalty programmes are little more than targeted discounts - and comparing between companies is almost impossible.
But those smart people at Bain seem to have cracked it. After looking at lots of possible measurements Fred Reichheld, the head of the loyalty practice at Bain, realised the one question that matters is "Would you recommend this company to a friend". From this insight Bain has developed the Net Promoter Score - asking people to give a score for that question - 10 is extremely likely and 1 is extremely unlikely. Those who answer 9 or 10 are promoters and those scoring 6 or less are detractors.
Subtracting the number of detractors from promotors gives the net promotor score - and Bain have shown that this score can be correlated to growth. The paper is a must read.
So now we have a way of valuing word of mouth, will we see more brands pay more than lip service to it?