Net Promoter Score (NPS)
What is a net promoter score?
Net promoter score (NPS) is a customer loyalty metric that gauges how likely customers are to recommend a company, product, or service to others. It is based on a single survey question with a 0-to-10 scale: “How likely are you to recommend [company/product/service] to a friend or colleague?”
How does a net promoter score work?
A NPS offers a simple yet powerful tool to collect honest feedback from customers and gauge customer sentiment and loyalty. Survey respondents are categorized into three groups based on their score:
- Promoters (9-10): Loyal enthusiasts who are likely to recommend your brand and drive positive word-of-mouth.
- Passives (7-8): Neutral customers who might not be highly engaged but aren’t unhappy either.
- Detractors (0-6): Unhappy customers who could potentially damage your brand reputation through negative reviews or feedback.
While NPS surveys can be conducted at any time, it’s recommended to establish a regular cadence (e.g., quarterly, biannually) to track trends and measure the impact of any implemented changes.
How to measure a net promoter score:
You can calculate NPS by subtracting the percentage of detractors from the percentage of promoters. Scores can range from -100 (all Detractors) to +100 (all Promoters).
A high positive score (closer to +100) indicates a strong customer base that is highly likely to recommend your brand. A negative score suggests a prevalence of detractors and potential brand reputation issues.
Why is a net promoter score important to marketers?
NPS provides a quick and actionable metric for customer loyalty. A high NPS score indicates a strong customer base that can fuel future growth. Marketers can use NPS to:
- Identify areas for improvement: Analyze feedback from detractors to understand their pain points and address them.
- Benchmark performance: Track NPS over time and compare it to industry averages to assess your relative standing.
- Prioritize customer experience initiatives: Focus efforts on improving areas that have the biggest impact on customer loyalty.
- Motivate customer advocacy: Encourage promoters to share positive experiences and recommendations.
Who needs to know what a net promoter score is:
- Ecommerce Managers: Understanding NPS is crucial for gauging customer satisfaction, informing marketing strategies, and driving sustainable growth.
- Customer Service Managers: NPS can help them identify at-risk customers and improve their overall customer experience.
- Product Managers: NPS feedback can be valuable for identifying product improvements that enhance customer satisfaction.
Use net promoter score in a sentence:
“Our recent NPS survey revealed a high score, indicating that a large portion of our customers would recommend our product to others.”