Introduction to NPS
Net Promoter Score (NPS) is a widely recognized tool in customer experience programs, providing a simple, straightforward metric that measures customers’ willingness to recommend a company’s product or service.
Understanding NPS
NPS is based on a single question: ‘How likely are you to recommend our company/product/service to a friend or colleague?’ Scores can range from -100 (everybody is a detractor) to +100 (everyone is a promoter). An NPS that is positive (i.e., higher than zero) is generally considered good, and an NPS of +50 is excellent.
How NPS Works
Customers are surveyed on a single, straightforward question. They’re asked to rate on an 11-point scale the likelihood of recommending the company or brand to others. Based on their rating, customers are then classified into three categories: Promoters, Passives, and Detractors.
- Promoters (score 9-10) are loyal enthusiasts who will keep buying and refer others, fueling growth.
- Passives (score 7-8) are satisfied but unenthusiastic customers who are vulnerable to competitive offerings.
- Detractors (score 0-6) are unhappy customers who can damage your brand through negative word-of-mouth.
Significance of NPS
NPS can be a strong predictor of a company’s customer relations and, hence, future company growth. Since 2003, many global companies have adopted NPS as a way to measure customer loyalty.
Conclusion
To wrap up, NPS is a critical measure of customer experience and overall satisfaction with a company’s product or service. Understanding how to use it can provide a significant boost to your company’s growth and reputation.
