NPS (Net Promoter Score)
NPS® (Net Promoter Score®) is a standardized measurement system that is used to measure customer loyalty and customer satisfaction. NPS® can be measured by asking customers:
How likely are you to recommend us to your friends and colleagues?
NPS® helps organizations to predict the company's business growth, especially when NPS® score is compared to NPS® industry benchmark and to competitors' NPS® scores within the same industry. NPS® describes the company history but also the current customer experience in the company. NPS® score is useful when estimating wider trends in customer loyalty and the customers' willingness to recommend your company to their friends or colleagues.
In NPS® tool, there is typically used a scale 0-10 wherein the customers who answer 0 are not likely to recommend and the customers who answer 10 are highly likely to recommend.
So the responses can be divided:
9-10 are promoters (highly likely to recommend),
7-8 are passives (or neutral), and
0-6 are detractors (not likely to recommend).
How NPS® is calculated?
The percentage of customers who are highly likely to recommend you (promoters), subtract those who are not willing to recommend your service or a product, for example. Additionally, they (detractors) aren't most likely to give you good word of mouth either.
% Promoters – % Detractors = NPS®.
But what is a good NPS® then?
NPS® score can vary between -100 to 100. NPS® score between
0-50 is good,
50-70 is excellent, and
70-100 is world class.
More information about NPS® you can find in our blog here.
Wan't to learn more? Read about KPI’s in our blog.