Net Promoter Score (NPS®)

What is Net Promoter Score (NPS)?

Net Promoter Score (NPS) is a customer loyalty metric developed by Fred Reichheld, Bain & Company and Satmetrix in 2003. It measures the likelihood of customers to recommend a company's products or services to others.

Net Promoter Score FAQs

How to calculate Net Promoter Score?

A Net Promoter Score is based on responses to a single question: "How likely are you to recommend our product/service/company to a friend or colleague?" The responses are given on a 0-10 scale, with 0 being not at all likely and 10 being extremely likely. Customers are then categorized into three groups based on their responses:

• Promoters (score of 9 or 10): These customers are highly likely to recommend the company.
• Passives (score of 7 or 8): These customers are satisfied, but not enthusiastic enough to recommend the company.
• Detractors (score of 0-6): These customers are unhappy and may spread negative word-of-mouth about the company.

Using the customer response data, NPS is then calculated by subtracting the percentage of detractors from the percentage of promoters. This results in a score ranging from -100 to 100, with a higher score indicating more satisfied and loyal customers.

What is the Formula for Net Promoter Score?

The formula for NPS is (Promoters - Detractors) / Total Respondents x 100. This results in a score ranging from -100 to 100, with a higher score indicating more satisfied and loyal customers.

What is a good NPS?

A good NPS varies by industry, but generally a score above 0 is considered positive and a score above 50 is considered excellent. However, the most important factor is to have a higher NPS than your competitors.

What does the Net Promoter Score measure?

NPS measures customer loyalty and satisfaction. It also serves as an indicator of future business growth, as loyal customers are more likely to continue using a company's products or services and recommend them to others.

How to calculate Net Promoter Score on a 5-point scale?

To calculate NPS on a 5-point scale, as opposed to a 100-point scale, you can use the following breakdown:

• Promoters (score of 4 or 5)
• Passives (score of 3)
• Detractors (score of 1 or 2)

Then, follow the same formula of (Promoters - Detractors) / Total Respondents x 100 to calculate your NPS.

How to improve the NPS in a call center?

To improve NPS in a call center, it is important to focus on providing excellent customer service and resolving any issues or complaints promptly. This can include providing thorough training for call center representatives, regularly monitoring and analyzing customer feedback, and continuously improving processes to better meet customer needs. Additionally, implementing a customer feedback system can help identify areas for improvement and measure the impact of any changes on NPS.  Overall, creating a positive and efficient experience for customers can lead to improved NPS in a call center setting.

Other Terms Related To Net Promoter Score: 

Average speed of answer (ASA)
Average talk time
Call abandonment rate
First call/contact resolution (FCR
Customer loyalty
Customer satisfaction (CSAT)
Customer lifetime value (CLV, LTV, CLTV)
Text analytics
Total quality management (TQM)
Key Performance Indicator (KPI)