Do you know what this methodology is about? If you don’t know it, don’t worry! In this article we will
explain its meaning, its importance for a company’s objectives , how to calculate it and other things
you should know about the NPS.
Check out the rest of the material!
What is NPS or Net Promoter Score?
This methodology, created in 1993 by poland telegram data American business strategist Fred
Reichheld, focuses on measuring the loyalty of a company’s customers based on recommendations.
To do this, it relies on a simple but powerful question: ” On a scale of 0 to 10, how likely are you
to recommend our products/services to a friend? “
Furthermore, this crucial question can be accompanied by open questions, as long as they are simple
to answer. One of them is “why would you recommend our products/services?”
In turn, the results of this survey become a metric that allows us to understand people’s behavior
when they buy and recommend a company’s products and services.
Why is the Net Promoter Score important for companies?
The results of this survey are valuable roas in digital advertising for various areas, especially for
marketing and sales. In addition, the NPS provides the highest management levels with different solid
data, which can optimize decision-making.
Specifically, the Net Promoter Score offers brands the following advantages:
Help improve user experience
Calculating the NPS allows you to know sms to data the levels of customer satisfaction and, therefore,
helps to identify aspects to improve in order to optimize the user experience .
The NPS and its results are useful for carrying out internal analyses and detecting which areas are not
performing adequately.
Allows you to measure loyalty programs
Loyalty programs are systems that encompass marketing actions and strategies that encourage
customers to frequently purchase new products from the same company.
Specifically, the Net Promoter Score allows us to measure how effective these programs are after a
certain period of implementation and whether they are generating the expected impact on users.
Enables benchmarking
This methodology is implemented by thousands of companies in different parts of the world.
For this reason, it is possible to implement it to compare the performance of your company with
others in the same market, based on benchmarking .
NPS can even be applied directly to measure the performance of competitors and thus obtain
valuable data about a given segment.
It makes the brand more human
Conducting these types of surveys helps to demonstrate to the customer that you are truly committed
to their satisfaction.
It also shows that behind the brand there is a group of people who recognise that they can make
mistakes and, above all, are willing to correct them.
How to calculate NPS or Net Promoter Score?
You already know what NPS is, so it’s time to explain how it can be calculated. In fact, it’s a very
simple task, which only involves these 3 steps:
1. Take the survey
As you may know, the main focus of the survey is to get customers to tell you, on a scale of 0 to 10,
how likely they are to recommend the products or services offered by your brand.
A few paragraphs back we gave an example of what this question might look like, however you can
give it the structure you want, as long as it follows this same approach.
Also, in a complementary way, it is necessary to ensure that those clients who do wish to recommend
your products give their reasons, as well as those who prefer not to do so.
2. Categorize the answers
Now, why should customers respond on a scale of 0 to 10?
What happens is that, according to the principles of NPS, customers are divided in the following way,
taking into account their responses:
- Promoters : These are customers who respond with a high score, i.e. 9 or 10.
- Passives: These are customers who respond with a modest score of 7 or 8, which is why they are not yet considered a captive audience.
- Detractors : are those customers who respond with a score of 6 or less.
Promoter or ambassador customers are of course very satisfied with the product or service and can be considered loyal, but you have to be very careful with passive ones, as they may be easily persuaded by other brands.
As for detractors, they are far from being established customers, so it is necessary to direct effective strategies towards them.
3. Calculate the average score
The Net Promoter Score calculation method is as follows:
First, calculate the percentage of each type of customer, for example, in a survey of 100 customers, they could be:
- 60 promoters (60%),
- 30 passives (30%)
- and 10 detractors (10%).
Then, subtract the percentage of detractors (in this case it would be 10%) from the percentage of promoters (60%), which would give +50.
This result can be considered a middle point, so there would be significant room for improvement.