Net Promoter Score (or Net Promoter System) is a proven methodology for measuring customer loyalty through first-hand feedback. NPS is a popular customer experience metric because it is simple, effective, and correlated to revenue growth.
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The Net Promoter System was developed in 2002 by Fred Reichheld, a Bain & Company consultant, out of the need for a customer experience metric that is predictive of customer loyalty and business growth.
After scrutinizing how traditional customer satisfaction survey questions correlate to consumer behavior, Reichheld concluded that evaluating customer loyalty versus customer churn was the answer. The carefully phrased NPS question, “How likely are you to recommend [company] to a friend?” has since been adopted by top brands worldwide.
A customer that is willing to recommend (promote) your company is also more likely to stick with you for the long haul. However, a customer that rates you poorly is more likely to detract from your business by churning or spreading negative word of mouth. NPS helps you identify both types of customers so you can improve your business.
Though there are many NPS question variations, the NPS methodology for improving the customer experience follows 4 basic steps.
NPS is comprised of a carefully crafted single question survey. Customers answer this question in two parts. The first part is a 0–10 numerical rating. This provides a standardized quantitative benchmark that can be tracked over time.
The second half of the NPS survey is a free-form follow-up question. This is where the real power of NPS reveals itself. It allows the customer to provide context for their rating in their own words, free from any bias that targeted survey questions might impart.
Your NPS survey can be distributed through a variety of methods - email, text, or even in person. Most companies find it helpful to have a dedicated NPS tool to deliver the survey automatically after the customer has had a full experience of the brand. NPS platforms also help tally the responses and calculate your score.
Customers are segmented into three groups according to their numerical response to the 0-10 rating question. But what do the different groupings actually mean?
“I really love your product. It’s exactly what I have been looking for!”
A promoter will go out of their way to recommend your product or service, often unprompted. They are willing to put their personal reputation on the line for it.
“It’s pretty good. I had a few issues here and there, but it got the job done.”
A passive probably liked your product or service, but it wasn’t a slam dunk. They may mention it in the right context, but they are unlikely to personally vouch for it.
“I wasn’t able to get it to work. I tried for hours. This is so frustrating!”
A detractor will proactively take any opportunity to dissuade people from using your product or service. They often speak louder than promoters.
NPS provides a score, ranging from −100 to 100, that serves as a report card, grading your overall customer experience.
Your NPS numerical score is the percentage of promoters minus the percentage of detractors.
71 − 14 = 57
If you already have responses from a previous NPS survey, you can calculate your NPS with our interactive NPS calculator or benchmark your NPS score against others in your industry.
Your numerical NPS allows you to quantify how changes you make to your product affect the customer experience over time.
Unexpected shipping delays
Improved response time
While the score itself gives you a really easy way to know where you stand with your customers at a glance, the true value of NPS comes from the customer feedback. Analyzing and acting on customer feedback insights is what will continue to move your business forward.
Traditional surveys bias customer feedback to what the company wants to hear, not what the customer wants to say. If you’re asking the wrong questions, you’ll never get the right answers. NPS passes the microphone to the customer, so they can validate or course-correct your business decisions.
Language is rich with “between the lines” messaging. Emotion and nuance is lost when customers are forced to choose from a selection of pre-defined answers that sterilize feedback. NPS lets the voice of the customer permeate your organization and drive change.
“You have some REALLY cool hidden gems, but I have a really hard time finding them. I know they are there, but after a 12-hour workday, I just don’t have the patience to go searching.”
When NPS is fully integrated into your organization, it creates a perpetual cycle of product and customer experience improvement. As trends emerge, your teams can address them quickly, and immediately measure the impact they have had, in very human terms.
“I was disappointed to find that your packaging was not compostable or biodegradable. What a shame! It’s 2019! I can’t recommend any service that does not respect the environment.”
NPS is a clear way to align organizations around customer experience. It’s easy to understand, and its format is very human. It keeps the focus on the customer.
Regardless of your size or industry, NPS is a great way to understand your customers. Connect with shoppers after their order arrives. Identify why customers choose your software over competitors. Get feedback from guests of your hotel after their stay.
For most companies, feedback arrives via the relatively small percentage of people who contact customer support for specific issues. Everyone has a story, and the vast majority of stories go untold. NPS surfaces feedback from people who you would have not otherwise heard from.
Your detractors are unsatisfied customers who are at risk of leaving you for a competitor. Recurring NPS surveys provide you with the feedback necessary to turn their experience around and monitor customer health to see if your changes are making an impact.
Your happiest customers can also be your brand evangelists. Identify your promoters through NPS surveys and ask them to review you on 3rd-party sites or participate in case studies to keep your reputation strong and promote your brand.
Many of the most adored companies rely on NPS to ensure a top-quality customer experience.
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“I am sooo glad I found you guys. I have been searching for the perfect gift for my 90 year old grandmother and this is PERFECT! This will mean so much to her. It’s like you read my mind!”