How to Calculate PPM: Product Performance Metric
PPM Mechanics and Implementation
Calculating the Power Performance Metric (PPM) involves averaging the individual sub-scores of S-NPS, S-PMF, and S-SUS. Each sub-score is calculated based on specific parameters related to customer sentiment, usability, and market fit. Let's explore the calculation process for each sub-score in detail:
Net Promoter Score (NPS): The NPS measures the likelihood of customers recommending the product. It is derived from the responses to the NPS question, which asks customers how likely they are to recommend the product. The original NPS question uses a scale of 0 to 10, categorizing respondents as promoters (rating 9 or 10), passives (rating 7 or 8), or detractors (rating 0 to 6). However, in the context of PPM, the NPS question is transformed into a scaled scoring system, ranging from -100 to 100.
To calculate the Scaled NPS (S-NPS), follow these steps:
Calculate the percentage of promoters by dividing the number of respondents who gave a rating of 9 or 10 by the total number of respondents.
Calculate the percentage of detractors by dividing the number of respondents who gave a rating of 0 to 6 by the total number of respondents.
Subtract the percentage of detractors from the percentage of promoters.
Apply a passive adjustment by subtracting the percentage of passives (those who gave a rating of 7 or 8) divided by 100.
Product Market Fit (PMF): The PMF sub-score assesses how disappointed customers would be if they could no longer use the product. It is derived from the responses to the PMF question, which asks customers how disappointed they would be without the product. Traditionally, achieving PMF is associated with over 40% of respondents indicating they would be "very disappointed" without the product. In the context of PPM, the PMF question is also transformed into a scaled scoring system.
To calculate the PMF sub-score (S-PMF), follow these steps:
Calculate the percentage of adopters by dividing the number of respondents who would be "very disappointed" without the product by the total number of respondents.
Calculate the percentage of departers by dividing the number of respondents who would not be disappointed without the product by the total number of respondents.
Subtract the percentage of departers from the percentage of adopters.
Apply a neutral adjustment by subtracting the percentage of neutrals (those who would be "somewhat disappointed") divided by 100.
Single Usability Scale (S-SUS): The S-SUS measures the user-friendliness or usability of the product. It is derived from the responses to the S-SUS question, which asks customers to rate the user-friendliness of the product on a scale of 1 (worst imaginable) to 7 (best imaginable). The S-SUS question remains unchanged in its scoring system.
To calculate the S-SUS sub-score, follow these steps:
Calculate the percentage of avid users by dividing the number of respondents who gave a rating of 6 or 7 by the total number of respondents.
Calculate the percentage of frustrated users by dividing the number of respondents who gave a rating of 1, 2, or 3 by the total number of respondents.
Subtract the percentage of frustrated users from the percentage of avid users.
Apply a viable users adjustment by subtracting the percentage of viable users (those who gave a rating of 4 or 5) divided by 100.
Calculating the PPM:
Once the sub-scores for NPS (S-NPS), PMF (S-PMF), and S-SUS are determined, the PPM score can be calculated by taking the average of the three sub-scores:
PPM = (S-NPS + S-PMF + S-SUS) / 3
This calculation provides businesses with a comprehensive and balanced understanding of their product's performance from the customer's perspective. By considering customer loyalty, market fit, and usability, the PPM offers valuable insights into the overall customer experience.
Example Calculation:
Let's illustrate the PPM calculation with a hypothetical scenario:
NPS: Promoters - 70%, Passives - 15%, Detractors - 15%
PMF: Adopters - 45%, Neutrals - 25%, Departers - 30%
S-SUS: Avid Users - 60%, Viable Users - 20%, Frustrated Users - 10%
Calculate S-NPS:
S-NPS = [(70 - 15) * (1 - (15/100))] = 46.75
Calculate S-PMF:
S-PMF = [(45 - 30) * (1 - (25/100))] = 11.25
Calculate S-SUS:
S-SUS = [(60 - 10) * (1 - (20/100))] = 40
Calculate the PPM:
PPM = (46.75 + 11.25 + 40) / 3 = 32.66
In this example, the PPM score is 32.66. This score provides valuable insights into the overall performance of the product, considering customer sentiment, market fit, and usability.
The PPM Advantage
PPM offers a more nuanced understanding of customer satisfaction and loyalty. It helps identify specific areas of the customer experience that require attention, facilitates data-driven decision-making, and fosters a customer-centric approach in an organization.