Understanding Your Net Promoter Score and What It Can Mean to Your Business

Full net promoter score

What is NPS (Net Promoter Score) and Why Does It Matter?

The Net Promoter Score or NPS is a customer satisfaction measurement tool that shows on an index of 1 to 100 the probability of a customer recommending a company’s product to others. Customers will recommend a service or product to others only if they are satisfied and happy with it. The NPS tells you whether a customer is satisfied with your product and loyal to your brand. Arguably, NPS is one of the best alternatives to the traditional customer satisfaction surveys and can have a direct impact on the revenue growth of a company.

Today, the NPS is being used by thousands of businesses around the world to calculate the customer satisfaction rate and improve the services accordingly. It has become the synonym of effective customer service. 

Let’s dive in and learn a little bit more!

How to Calculate the Net Promoter Score?

In order to calculate the NPS, you just need to ask your customers one simple question, how likely are you to recommend our product or services to others?

The responses are to be taken on a scale of 0-10 for which the details are given below.

A company’s customers can be divided into three groups based on their responses to the above question.

·       Promoters: They are the loyal customers who gave you a 9 or 10 score. They are most likely to keep using your products or services as well as refer others.
·       Passives: They are the ones who chose a score between 7 and 8. They like your products today but are not loyal enough to stay with you forever. They may or may not recommend your           services to others.
·       Detractors: In this category, we put the ones who rated between 0 and 6. These are the ones you should be aware of as they can possibly damage your brand through negative publicity.

Importance of NPS

The basic purpose of a business is to make money and that can be done only with the help of satisfied customers. If a customer is not satisfied with your company’s product or service, he will most likely go to one of your competitors, who can offer a better service. The Net Promoter Score tells you which ones of your existing customers are not happy with your services, thus giving you a chance to make the right decision to tackle the problem when there is time.

Promoters play a big role in the actual marketing of your business. According to an NPS survey, about 80 percent of most businesses’ referrals are accounted by the company promoters. It is important to understand their value and keep providing high quality services to them.

On the other hand, detractors are mostly responsible for bringing negative publicity to a business. More than 80 percent of a company’s negative word-of-mouth publicity is generated by these detractors.

By knowing the right NPS score, you can effectively deal with the detractors and promoters of your brand services.

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