Net Promoter® is both a loyalty metric and a discipline for using customer feedback to fuel profitable growth in your business. Developed by Satmetrix,® Bain & Company, and Fred Reichheld, the concept has been embraced by leading companies worldwide as the standard for measuring and improving customer loyalty.
It is a straightforward metric that holds companies and employees accountable for how they treat customers. It has gained popularity thanks to its simplicity and its linkage to profitable growth. Employees at all levels of the organization understand it, opening the door to customer-centric change and improved performance.
Net Promoter Score (NPS®) is based on the fundamental perspective that your customers can be divided into three categories:
By asking one simple question — How likely is it that you would recommend [Company X] to a friend or colleague? — you can track these groups and get a clear measure of your company’s performance through your customers’ eyes. Customers respond on a 0-to-10 point rating scale. To calculate your Net Promoter Score, take the percentage of customers who are Promoters and subtract the percentage who are Detractors.
Net Promoter Score categorises your customers into three categories based on their willingness to recommend your brand:
- Promoters (score 9-10) are loyal customers who keep buying more and refer others.
- Passives (score 7-8) are satisfied but unenthusiastic and vulnerable to competition.
- Detractors (score 0-6) are unhappy, impede growth, and damage your brand through negative word of mouth.
To calculate your Net Promoter Score, take the percentage of customers who are Promoters and subtract the percentage who are Detractors.