Net Promoter Score often referred as NPS is a metric that indicates the customers’ likelihood chance to recommend a product, service, or organization as a score for your customer experience.
What is Net Promoter Score (NPS)?
NPS is a metric that tells you your overall customer experience quality, based on your existing customers’ likelihood to recommend your product, service, or organisation.
Yes, sounds simple & straight forward, but what does that actually mean?
In any customer experience programs staff/ managers handling need to quantify the sentiments of the customers by measuring using a quantitative mechanism or score. Score gives indication of happy customers and their brand loyalty, a positive level of satisfaction or high reported levels of top-quality customer services
This data leading to the score can have a profound impact on the strategy, budget-allocation, and any plans for the organization. In these cases and others, NPS is used to get a representative landscape of how your customers think about you.
What is the formula for NPS?
The Net Promoter Score replicates the customer experience process to a greater extent, working at a business-to-business level and directly asking their existing customers.
The scale is rated from 0 (not at all likely) to 10 (extremely likely). Depending on the responses, customers fall into one of 3 categories- Promoters, Passives & Detractors
- Promoters are customers who respond with a score of 9 or 10. Typically, these customers are loyal and enthusiastic customers.
- Passives are customers who respond with a score of 7 or 8. These customers are satisfied with your service but not happy enough to be considered promoters.
- Detractors respond with a score of 0 to 6. These are unhappy customers who are unlikely to buy from you again, and may even discourage others from buying from you.
From examining the ratios of each group along the scale, you can see that there is more opportunity to be seen as a detractor, than as a passive or promoter.
Subtracting the percentage of detractors from the percentage of promoters.
Net Promoters Score= Total % of promoters – total % of detractors
Sample Excel Calculator for Net Promoter Score