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NPS

What is Net Promoter Score?

Net Promoter Score (NPS) is a metric used to measure customer sentiment. It helps companies understand how likely their customers are to recommend their product, service, or company to others. Here’s how it works:

  1. Survey Question: Companies ask their customers a single question: “On a scale of 0 to 10, how likely are you to recommend our product/company to a friend or colleague?”

  2. Categorization:

  • Promoters: Customers who respond with a 9 or 10. These are enthusiastic and loyal customers who may act as brand ambassadors.
  • Passives: Customers who respond with a score of 7 or 8. They are satisfied but not necessarily enthusiastic.
  • Detractors: Customers who respond with a score of 0 to 6. These are unhappy customers who might spread negative word-of-mouth.
  1. Calculation:
  • Subtract the percentage of detractors from the percentage of promoters to get the NPS score.
  • The NPS score can range from -100 to +100.
  1. Interpretation:
  • A high NPS (closer to +100) indicates strong customer loyalty and positive growth potential.
  • A low or negative NPS suggests areas for improvement.

What should I think about Promoters, Passives and Detractors?

Let’s break down the categories of Net Promoter Score (NPS) respondents:

  1. Promoters:
  • These are customers who gave a high score (9 or 10) in response to the NPS question.
  • Promoters are enthusiastic and loyal. They actively recommend your product, service, or company to others.
  • Companies should nurture and engage with promoters to leverage their positive influence.
  1. Passives:
  • Passives fall in the middle range, scoring 7 or 8.
  • They are satisfied but not overly enthusiastic.
  • While they may not actively promote your brand, they also won’t actively discourage others.
  1. Detractors:
  • Detractors are customers who gave a low score (0 to 6).
  • They are unhappy or dissatisfied.
  • Detractors can harm your reputation by spreading negative feedback.
  • Companies should focus on addressing their concerns and turning them into promoters.

Remember, the goal is to increase the percentage of promoters and minimize detractors to improve overall NPS. 

What’s a good score?

While there isn’t a universally agreed-upon threshold for Net Promoter Score (NPS) that indicates success, here are some general guidelines:

  1. Positive NPS Range:
  • An NPS above 0 is generally considered positive.
  • A score between 0 and 30 suggests that your customers are satisfied, but there’s room for improvement.
  • Companies in this range should focus on turning passives into promoters.
  1. Excellent NPS Range:
  • An NPS between 30 and 70 is excellent.
  • It indicates strong customer loyalty and positive word-of-mouth.
  • Companies in this range are likely to have a competitive advantage.
  1. World-Class NPS Range:
  • An NPS above 70 is considered world-class.
  • Achieving this level of loyalty is exceptional.
  • Companies with such high NPS scores often thrive due to customer advocacy.

Remember that the ideal threshold can vary by industry, company size, and customer expectations. It’s essential to compare your NPS with industry benchmarks and set realistic goals based on your specific context. Continuously improving customer satisfaction and loyalty is the key to long-term success!

What is a bad NPS score?

Any score below 0 indicates that a business has more detractors than promoters. A negative NPS is a sign that a business has some serious work to do to improve the situation, reduce the number of unhappy customers, and generate more promoters.

How can we improve our Net Promoter Score?

Improving Net Promoter Score (NPS) involves several strategies to enhance customer satisfaction and loyalty. Here are some actionable steps:

  1. Listen to Customer Feedback:
  • Regularly collect feedback from customers through surveys, interviews, or social media.
  • Understand their pain points, expectations, and preferences.
  1. Address Detractors:
  • Focus on resolving issues for detractors (customers who gave low scores).
  • Investigate the reasons behind their dissatisfaction.
  • Provide personalized solutions and follow up to ensure their concerns are resolved.
  1. Engage with Promoters:
  • Promoters (customers who gave high scores) can be valuable advocates.
  • Encourage them to refer others and leave positive reviews.
  • Consider loyalty programs or incentives for referrals.
  1. Improve Customer Service:
  • Train customer-facing teams to provide excellent service.
  • Respond promptly to inquiries and complaints.
  • Empower employees to make decisions that benefit the customer.
  1. Enhance Product/Service Quality:
  • Continuously improve your offerings based on customer feedback.
  • Address any product/service shortcomings promptly.
  • Innovate and stay ahead of competitors.
  1. Benchmark and Set Goals:
  • Compare your NPS with industry benchmarks.
  • Set realistic goals for improvement.
  • Regularly track progress and adjust strategies as needed.
  1. Communicate Transparently:
  • Be open about changes, updates, or challenges.
  • Transparency builds trust with customers.

Remember, NPS is a holistic metric, and improving it requires a company-wide effort. By prioritizing customer satisfaction, companies can positively impact their NPS and overall success