Do they like you? Do they like, like you?
Net Promoter Score is a way to measure the loyalty between a customer and an organization. It can replace many of the questions and legwork that go into customer satisfaction surveys, and often the response rate for it is much higher because it relies on asking one simple question:
How likely is it that you would recommend our company/product/service to a friend or colleague?
Customers are then given the 11 point scale above, with 0 being “Highly Unlikely” and 10 being “Highly Likely.”
Those who answer a 9 or a 10 are considered Promoters, people who are willing to sing your praises to others.
People who answer 7 or 8 are considered Passives. They like your products, but they’re not exactly chomping at the bit to promote your products/services to their friends or colleagues.
Perhaps surprisingly, anyone answering 6 or lower is a Detractor. That’s right, if someone is on the fence about promoting you and scores you a 6, they are technically in the same category as someone who rates you a 0.
Calculating Net Promoter Score
After asking this question to customers and getting their responses, it’s time to calculate the Net Promoter Score (or NPS). Here’s how:
Let’s assume we sent out an NPS survey to our customers and we got 100 responses.
Add up all respondents who answered a 9 or a 10. For our example, let’s assume 30 people did this. That means that 30% of the total responses were Promoters.
Next, add up all respondents who answered a 7 or an 8. Let’s assume 60 people fall into this category. So 60% of responses were Passives.
Now, add up all respondents who answered a 6 or lower. Let’s assume 10 people were these detractors. So 10% of our responses are Detractors.
Finally, to get our NPS, we simply subtract the percentage of Promoters from the percentage of Detractors: 30% Promoters – 10% Detractors = 20% Net Promoter Score.
What this means
NPS can range from 100% (hurray, everyone loves you!) to -100% (nobody likes you, maybe you should find a rock to hide under.)
A positive NPS is a good sign. An NPS of 50% or more is a great sign that you’re doing very well and your customers are pleased with the product/service they are getting.
A negative NPS is a bad sign. It shows that something is wrong and that there is little customer loyalty to your products/services. You’re probably getting very little word-of-mouth advertising and your customer churn rate is probably being affected as well.
NPS varies by industry. Some industries, such as cable and phone providers, usually have low Net Promoter Scores. It’s important to take this into account, because your organization may not have the same type of following as an Apple or a Tesla – both of which consistently score high Net Promoter Scores.
Instead, it’s great to benchmark against yourself, and work to grow your NPS through better products, customer service, and marketing.
How this affects marketers
Quick story: We’ve been a customer of Moz, the SEO suite, for nearly a decade. We have always recommended Moz to colleagues and customers. However, up until a year ago, their tools were actually not as good as some of their competitors. So why did we recommend them?
Moz has an entire community of SEO and content marketing geeks like me. They also have amazing content that consistently helps me. In return, we continued to use their products and recommend them because we believe in what they’re doing, even if their tools weren’t quite as good as their competitors.
Marketing has an impact on Net Promoter Score. As marketers, our jobs don’t stop once we get a customer. The content we build, the solutions we provide to our audiences for free, and the experience we give our industries are a major component to how customers view our products. Customer retention is an area marketing often forgets. It shouldn’t be.Customer retention is an area marketing often forgets. It shouldn’t be. Click To Tweet
If you’re not measuring how well your marketing efforts are retaining customers, you may be missing out on a very important piece of how your marketing efforts are actually performing across the board.
A simple way to measure this is to run client-focused campaigns – not to upsell them, but to engage them, and build the brand with them. Then, measure their NPS over the length of the campaigns. If you find that the NPS is moving up, and everything else remains equal, your marketing efforts are succeeding.
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Join the discussion 2 Comments
Good job Brandon! Love the article on Net Promoter Score! Great stuff.
Thanks Randy! Love the profile pic.