The number of unique participants in our industry has declined in recent years from 10.1 million to 8.4 million. Today, 17 years after NSAA released its Model for Growth, it is clear that there is no “silver bullet” to grow participants and skier visits. Indeed, it is increasingly clear that the industry must wage a battle on all fronts to increase trial, conversion, retention, and the frequency of visits.

We believe that an enhanced guest experience, one that fosters loyalty, will be the greatest contributor to the future growth of our industry. A better experience impacts each of the industry’s needs, and is proven to drive higher levels of repeat and referral business—the two primary sources of revenues. The Net Promoter Score (NPS) can play a key role in accomplishing this.

The Birth of NPS

For decades, companies in many industries focused on guest satisfaction as a way to measure the guest experience. However, satisfaction does not correlate highly with business results.

In 2003, in search of a better metric, Fred Reichheld, Bain & Company, and Satmetrix Systems, Inc., tested a variety of measurements. Among these were the “likelihood to recommend,” “the company deserves my loyalty,” and overall satisfaction. In these tests, conducted across 14 industries, the likelihood to recommend had the highest correlation with business results, and satisfaction had the lowest correlation. In 2003, Reichheld first reported these results in “The One Number You Need to Grow, ” which appeared in the Harvard Business Journal.

Reichheld wrote: “The path to sustainable, profitable growth begins with creating more promoters and fewer detractors, and making your Net Promoter number transparent throughout your organization. This number is the one number you need to grow. It’s that simple and that profound.”

Calculated by subtracting the percentage of a company’s Detractors from the percentage of Promoters, NPS has become the universal measurement of customer loyalty.

NPS MEETS the Ski Industry

Three years later, the Net Promoter Score was introduced to the ski industry in an NSAA Journal article titled, “Do You Know Your Score?” Despite the inherent logic and ease of use of NPS, few ski resorts adopted it. To many, the differences between satisfaction and loyalty were difficult to grasp.

But not to all. Brian Fairbank, CEO of Jiminy Peak, Mass., asked our company to add the “likelihood to recommend” question to its guest survey. We evaluated the Net Promoter metric over the next two years, and found it superior to other metrics. Jiminy then adopted Net Promoter Scoring not only for its “likelihood to recommend” loyalty question, but for all of its performance ratings throughout the resort.

One key advantage (among many) of the Net Promoter Score is the ability to identify a resort’s Promoters or Loyalists as well as its Detractors. Promoters will ski/ride more frequently, refer the resort more often, and are responsible for 80 percent of the positive word-of-mouth. Detractors, on the other hand, may not return or will return less frequently, and are responsible for 80 percent of the negative word-of-mouth. If you know who your Promoters, Passives, and Detractors are, you can personalize your communication with them, extend different promotional offers based on their loyalty, and recover with Detractors.

Based on this experience, Brian recommended we offer this 100-percent Net Promoter Score system to the entire industry. We did so at the 2009 NSAA Convention.

The Evolution of NPS

Since then, the system has continued to evolve and become more broadly adopted. Beyond the shift from satisfaction to loyalty, here are five other steps in the evolution of NPS in the ski industry.

1. From Theory to Reality
When Fred Reichheld’s first book, The Ultimate Question, was published in 2006, there was relatively limited empirical data proving the relationship between loyalty (as measured by NPS) and financial performance. Skeptics considered the relationship only a theory. But as more and more organizations adopted the Net Promoter Score, the link between loyalty and business results was confirmed in industry after industry.

In Reichheld’s second NPS book, The Ultimate Question 2.0, written with Rob Markey and published in 2011, the authors highlighted the impact of NPS on the business results of a number of industry leaders. Bain reported on its own research in “How the Net Promoter Score Relates to Growth,” in which it noted, “On average, an industry’s Net Promoter Score leader outgrew its competitors by a factor greater than two times.”

To establish the link between NPS and business results, it’s necessary to quantify the financial impact of increasing Promoters and decreasing Detractors. The year after The Ultimate Question 2.0 was published, we developed our own financial modeling for this purpose, using data from our resort partners’ surveys.

As we examined our data, we learned that Promoters ski/ride significantly more often than Passives, who ski/ride significantly more often than Detractors. In addition, Promoters recommend the resort they’re loyal to significantly more often than do Passives, who recommend significantly more often than Detractors. The data proved the link between NPS and increased repeat and referral business, thus proving NPS’ financial impact.

2. From On-site to Post-departure Surveying
An effective Net Promoter System requires real-time feedback so that a resort can respond quickly to it, make adjustments to service delivery, and recover with Detractors before they criticize the resort on social media and user reviews. But a survey taken during a guest’s stay can introduce its own errors.

We opted for post-departure email surveying, for several reasons: This eliminates the “interviewer effect,” which can artificially inflate ratings by 5 to 30 points; and it facilitates more in-depth surveying of the entire guest journey, providing the operational staff with more quantitative and qualitative feedback. In addition, post-departure surveys don’t interrupt the guest experience.

3. From Score to System
For several years, “NPS” referred to “Net Promoter Score.” However, we and other practitioners have learned that it takes a system of best practices to increase the Net Promoter Score. Typically, resorts that adopted the metric, but did not have a system to support it, achieved only minimal increases in their score. So NPS has evolved from a score to a system.

A Bain Brief on this change described it this way: “A Net Promoter System is a management philosophy, a way of running a business. Net Promoter companies commit to specific processes and systems that help everyone focus on earning the passionate loyalty of both customers and employees.”

In short, while the Net Promoter Score is the one number you need to grow, it takes a system of best practices to make growth happen. We give our resort partners access to dozens of best practices developed with our research partners.

4. From Marketing Tool to Operational Management Tool
NPS is often viewed as a marketing tool and, therefore, the responsibility of the marketing department. But really, NPS is an operational management tool that affects all departments, all staff members and all touch points of the guest experience. NPS enables a resort to hold staff accountable for improvements, recognize “service stars,” recover with at-risk guests, and define its brand. Responsibility for its success, therefore, lies with senior management.

5. From Mountain Focus to Guest Focus
The guest experience includes many touch points along the guest journey. It begins with the evaluation of alternative resorts and the website experience. It extends to arrival at the resort, all the way through departure and providing feedback on the visit experience.

While the on-mountain experience is critical, so too are lodging, lessons, non-ski activities, food and beverage, and other areas. A poor experience in one area can ruin the entire visit experience. For this reason, post-visit Net Promoter surveys typically combine the likelihood to recommend and other loyalty measurements with questions that measure satisfaction with all the touch points.

Importantly, in-depth guest feedback on the entire visit experience enables a resort’s management team to consider the possible impact on the guest experience of any operational, marketing, or capital decisions being considered.

NPS: the Next Ten Years
NPS has established itself as one of the most important tools to enhance the skier/rider experience, increase loyalty and generate higher levels of repeat and referral revenue. How will NPS continue to evolve and what does the future of NPS look like in the ski industry?

We believe there are at least four ways NPS will evolve, mature and continue to help the industry grow. These are: (1) analyzing NPS by guest segment; (2) identifying the key drivers or determinants of satisfaction and loyalty, and focusing on those drivers; (3) learning how to increase the positive emotions involved in our sport; and (4) applying NPS to employees and other relevant audiences.

1. NPS by Guest Segment: Satisfaction and loyalty can vary by demographic or marketing segment. In general, higher income guests, first-time visitors to a resort, and Millennials rate their visit satisfaction lower and tend to be less loyal. As resorts drill down into their data and apply filters for these segments, many will identify key opportunities to grow their businesses, including those that align with their overall strategies. For example, to increase the conversion rate of first-timers and beginners, filters for these segments can be applied to the ratings and guest comments to identify touch points that must be improved. This will help enhance their overall experience and increase the likelihood they will continue with the sport.

2. The Drivers of Satisfaction & Loyalty: Early adopters of NPS have recognized the importance of focusing their resources on what is most important to their guests’ satisfaction and loyalty. Statistical analysis of guests’ performance ratings can identify what drives overall satisfaction, the likelihood to recommend the resort, satisfaction with each of the departments and food and beverage outlets, and overall staff friendliness. This information can then be combined with performance ratings and comparisons to one’s competitive set to help make operational, marketing, and capital decisions.

3. Emotional Loyalty: Traditionally, guest satisfaction surveys have measured attributes such as rental shop efficiency, slope grooming, quality of terrain parks, accommodations, and food and beverage quality. A growing body of research suggests customer loyalty is based not only on those rational components, but on emotional elements as well.

Based on our research, we believe both components are important. As neurologist Antonio Damasio said, “We are not thinking machines that feel; rather we are feeling machines that think.” Emotional engagement and emotional loyalty are the new frontiers in loyalty.

In short, it is important to understand how guests’ experiences make them feel. Emotions can be positive or negative: they may include such feelings as happiness, excitement, accomplishment, confidence, anxiety, frustration, and fear, among others. Resorts that are serious about increasing their loyalty and Net Promoter Scores must learn more about the emotions they evoke from their guests—overall and by generation and other segments.

4. Employee NPS: Employee loyalty and guest loyalty are inextricably linked. Happy employees make happy guests, and happy guests, in turn, make happy employees who are more productive. (For a full discussion of this, see “Circle of Trust,” SAM September 2015.) A resort’s frontline staff, in particular, affects the guest experience and creates many of the emotions guests feel. Because of this linkage, more and more resorts are asking employees, “How likely are you to recommend the resort as a place to work?” Measuring both guest and employee loyalty provides a more holistic view of loyalty to a resort.

The bottom line is very clear: as ski resorts and manufacturers enhance the guest experience, we will attract more new users to the industry, increase the conversion rate, increase retention, and increase visit frequency.