Net Promoter Score (NPS) measures customer satisfaction and brand loyalty using a single question. It’s a useful metric that can offer quite a bit of insight into your customers and allow you to stay in touch with reality in terms of the customers’ experience.
The NPS assesses to what extent a respondent would recommend a certain company, product or service to his friends, relatives or colleagues. The idea is simple: if you like using a certain product or doing business with a particular company, you like to share this experience with others.
Respondents are grouped as follows:
- Promoters (score 9-10) are loyal enthusiasts who will keep buying and refer others, fueling growth.
- Passives (score 7-8) are satisfied but unenthusiastic customers who are vulnerable to competitive offerings.
- Detractors (score 0-6) are unhappy customers who can damage your brand and impede growth through negative word-of-mouth.
Subtracting the percentage of Detractors from the percentage of Promoters yields the Net Promoter Score.
On its interpretation, a higher NPS means that a company has more promoters than detractors who are more likely to refer you to other customers.