What Is a Net Promoter Score?
Posted By: DSG
With the purpose to further corroborate the consequence of delivering a customer centric customer experience… enter Net Promoter Score (NPS) an active measure of a customer’s allegiance to a brand, product or service.
The appraisal and measurement of the Net Promoter Score of a customer base indicates the impact of a customer’s relationship with a company and their overt loyalty, or lack thereof, towards a brand.
We have spent much time highlighting the shift in the way in which an organisation elicits a sustainable customer experience and lasting relationship with consumers. Through the measurement of a customer’s Net Promoter Score, a loyalty metric developed by Fred Reichheld, Bain & Company, and Satmetrix, NPS brings a more meaningful connotations to the traditional measurement of customer satisfaction.
Net Promoter Scores can be collected during a solicited Voice of the Customer survey and is characterised by 1 simple question;
“On a scale of 0 to 10, (0 being not at all and 10, very) how likely is it that you would recommend our company, product and or service to friends and or family?”
The weighted question should be followed by an opportunity to substantiate the score and elaborate on the customer experience that has commanded the associated score.
- Scores resulting between 0 and 6 denotes the data set of detractors of clients that are least likely to endorse, refer or recommend a brand, the product or service. These customers are more likely to undermine the brand as a result of a product or service failure during the CX relationship.
- Outcomes between 9 or 10 indicate brand advocates or promoters; those customers with a strong affiliation with the brand and who are more likely to refer and advocate the use of products or services.
- Net promoter Scores collected between 7 and 8 indicate the passive market, somewhat indifferent and impartial to the brand. The number of passive customers contributes to the overall tally of participants but has no effect on the net score.
Once scores are collected and each pocket of data converted to a percentage, to calculate NPS, subtract the detractors from advocates. The Net Promoter Score will range between -100 (with majority of all customers being detractors) up to 100 (where every customer is an advocate).
If the collection of an NPS is facilitated during a solicited VoC (voice of the customer) survey, best practice see’s further examination of customer perception of the brand and individual products / services.
Questions that support the evaluation of the Customer’s Lifetime Value and overall CX will further ensure that impactful data is gathered during the feedback session each with a critical influence on CX strategies.