What is NPS?
NPS stands for Net Promoter Score. It is a customer experience metric used to understand how likely customers are to recommend an organization, product or service to others.
NPS is often used as a simple indicator of customer loyalty and advocacy. It can help organizations understand the strength of customer relationships, but it should always be combined with comments, context and follow-up to explain what is driving the score.
Quick Answer:
NPS measures how likely customers are to recommend your organization to others.
It is based on one question: “How likely are you to recommend us to a friend or colleague?”
Customers answer on a scale from 0 to 10. Their responses are grouped into promoters, passives and detractors.
A Simple way to Understand NPS
NPS helps organizations understand whether customers are likely to speak positively about them.
A high NPS can indicate that many customers are loyal and willing to recommend the organization. A low NPS can suggest that customers are dissatisfied, uncertain or experiencing problems that may affect the relationship.
But the number alone does not explain why customers feel that way. That is why NPS is most useful when it is followed by open-text feedback and further analysis.
How is NPS Calculated?
NPS is calculated by subtracting the percentage of detractors from the percentage of promoters.
- Promoters are customers who answer 9 or 10.
- Passives are customers who answer 7 or 8.
- Detractors are customers who answer 0 to 6.
The formula is:
NPS = percentage of promoters minus percentage of detractors
The result can range from -100 to +100.
NPS Example
A company asks 1,000 customers how likely they are to recommend the company.
The results show:
- 500 customers are promoters.
- 300 customers are passives.
- 200 customers are detractors.
That means 50% are promoters and 20% are detractors.
The NPS is 30.
This gives the company a simple overall indicator of customer advocacy. To understand what to improve, the company also needs to look at customer comments, customer journey data and patterns across different customer groups.
How is NPS Used?
NPS can be used to track customer loyalty over time, compare customer groups or identify areas where the customer experience needs attention.
Some organizations use NPS as part of a relationship survey to understand the overall customer relationship. Others use it after specific interactions, such as onboarding, support or delivery.
NPS is most valuable when it is used as a starting point for learning, not as the final answer.
Common Misunderstandings
- NPS does not explain customer experience on its own.
- A high NPS does not mean every part of the customer journey works well.
- A low NPS should be explored, not only reported.
- NPS should be combined with customer feedback and context.
- The value of NPS comes from understanding what drives the score.
Related Customer Experience Topics
Explore customer experience further
NPS can help organizations understand customer loyalty and advocacy. When the score is combined with feedback and follow-up, it can support better decisions about the customer experience.
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