October 10, 2022
The Net Promoter Score (NPS) is a measurement looking into the customer experience of a brand and predicting business growth.
The metric is proven and widely known for transforming the business world and provides brands with the core measurement for customer experience management programs around the world.
The NPS metric was developed by and a registered trademark of Fred Reichheld, Bain & Company and Satmetrix. It was introduced by Reichheld in a Harvard Business Review article in 2003, “The One Number You Need to Grow“. The popularity and broad use of it has been largely attributed to its simplicity from being just a single question.
Calculating NPS is based on the answer to a key question, using a 0-10 scale: How likely is it that you would recommend (the brand) to a friend or colleague? NPS index ranges from -100 to 100, measuring the willingness of consumers to recommend a product or service to others. It can also inform a brand of the loyalty that they hold within their sector. are then grouped as follows:
Detractors gave a score that is equal to 6 or lower. They aren’t thrilled by the product or service you offer. In all likelihood, they won’t purchase from the company again, whilst potentially damaging the company’s reputation through the negative spreading of word of mouth.
Passives graded your company a score of 7 or 8. They have been somewhat satisfied by what you offer, but could easily switch to a competitor offering if given the reasoning or opportunity. They won’t spread any negative reviews but are not going to speak enthusiastically either.
Promoters are your company’s backbone. They score 9 or 10 and have a strong affiliation with your product or service. They are repeat buyers and enthusiastic about your brand, who recommend the company to any new potential buyers they encounter.
The score is then determined by subtracting the percentage of customers who are detractors from the percentage who are your promoters. What is generated is a score on the -100 to 100 scale called the Net Promoter Score.
Understanding NPS is a great starting point for learning more about the health of your business. To find out more, you can read up on our Brand Tracking services and dashboards, BrandVision, which uses 9 Key Metrics (NPS included) as a way to understand your Brand Equity.
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