Net Promoter Score (NPS) is a way to measure how likely a customer is to recommend your service to someone else, and can be used to gauge customer loyalty. While the scale can take many forms, a common one is a score from 0 to 10.
The scale answers a key question: “How likely would you be to recommend the product/service/brand to a friend or colleague?” The answer that customers give puts then them in one of three categories.
Net Promoter Score Groups
The respondents are divided into 3 different groups:
- Promoters (score 9-10): most likely to recommend you. Loyal enthusiasts who will keep buying your product or service.
- Passives (score 7-8): satisfied customers, but not enthusiastic buyers. These customers are vulnerable to competitive offerings.
- Detractors (score 0-6): unhappy customers who can easily damage your brand by bad recommendations.
Calculating Net Promotor Score is straight-forward once respondents are grouped. As seen in the graphic above, it is the percentage of detractors subtracted from the percentage of promoters (passives are not taken into account).
% Promoters – % Detractors = NPS
The Net Promoter Score represents the customer satisfaction and company growth in a straightforward way. It allows you to benchmark your companies performance and to improve your customers’ overall satisfaction. Being able to visualize the score is important so that it is possible to see when and why it is increasing or decreasing. An increasing NPS shows that customers’ experience is improving while a decrease shows the opposite. There are many tools that can be used to visualize the data, one of which is Chartio which can help you to monitor the development of your customers satisfaction.
For more information on how to track and monitor your Net Promoter Score, take a look at this tutorial.
There are many reasons why it is important to keep track of Net Promoter Score. One of which is for Business to Business transactions. Since the score is a part of the Advocacy of a company, it can be important for other companies to know before doing business. This is because NPS is a useful proxy for customer satisfaction and retention.
Here is a more in depth explanation of important NPS and other important Business to Business metrics.« Back to Glossary Index