Net Promoter Score (NPS) is a customer loyalty metric that measures the willingness of customers to recommend the company's products or services to others. Measuring NPS can help you determine whether or not your brand is perceived as trustworthy by customers, which will play a big role in whether or not they want to continue doing business with your company in the future.
NPS can be used to evaluate the quality of a company's products or services, as well as its customer service efforts.
How to measure Net Promoter Score (NPS)?
The Net Promoter Score is a measure of customer loyalty, calculated by asking customers one simple question: "How likely you would recommend [products or services] to others?"
To measure NPS, customers are asked to answer a question on a scale from 0 to 10. NPS is based on the concept of Promoters, Passives, and Detractors.
Customers are likely to return to your store.
People who give you a score of 9 or 10, are the promoters, as they like your products or services.
They will refer you, they will tell other people about their experience with your product/service and you’ll get more revenue from them. Their support is crucial for growing any business so make sure that every customer has an amazing experience when using or returning to one of your products/services.
Customers who can shop at your competitors next time.
Customers who give a core of 7 or 8 are the passives. Passives are not loyal to you, but they also don't have any negative feelings about your brand. They're neutral. These customers may be satisfied with the product or service they've had from you, but they're not likely to recommend your brand because there are no clear benefits that would come from doing so.
Passives have a low probability of coming back and making repeat purchases.
Passives must be converted into promoters if you want to increase NPS scores! The best way is by making them feel appreciated, valued, and cared for through consistent communication throughout the customer journey.
Customers who will never come back and can spoil your reputation by giving negative reviews to other customers.
If you're measuring the NPS, you'll want to know how many customers are detractors. A detractor is anyone who gives scores 0-6 on your Net Promoter Score question. If a customer has given you a score of 0 to 6, they are unlikely to come back again or recommend your business to others.
They may also post negative reviews online, which could reach thousands of potential customers and put them off using your service or buying from you in the future - costing you valuable revenue streams over time. To improve the NPS score, you need to turn detractors into promoters.
The NPS score is a whole number ranging from -100 to 100 and indicates happiness with brand experience. Calculating your NPS score is as simple as subtracting the percentage of detractors from the percentage of promoters. The formula to measure NPS is as:-
NPS = [ (No. of Promoters - No. of Detractors) / Total no. of respondents ]* 100
NPS = % of Promoters - % of Detractors
For example, If you survey 100 customers and the result is made up of 60 promoters, 10 detractors, and 30 passives, your NPS would be:-
NPS = [ ( 60-10 ) / 100 ] *100 = 50%
How to improve NPS score?
Benefits of measuring Net Promoter Score ( NPS ):-
Calculating the Net Promoter Score is a great way to measure customer loyalty and find out how satisfied they are with your product or service. You can use this information to make changes in your business that will help it grow.
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