NPS stands for Net Promoter System / Score (created by Fred Reichheld) and is the global standard used to understand the pulse of a particular customer base and their Likelihood To Recommend (LTR) your products and services. The NPS measures the loyalty of your customers to your brand based on the experience that you’ve provided them and is based on one simple question:
“How likely are you to recommend our Products and Services to your friends or colleagues?”
Note: Data from Customer Survey’s can be game changing, shedding light on opportunities for improvement and being a source of truth, providing valuable insights that can be correlated to strategic KPI’s, aimed at improving targeted company goals.
Relationship Survey (rNPS):
Measured at an organization or business unit level
Transactional Survey (tNPS):
Measured after customer transactions (i.e. after calling into Tech Support or after services have been turned up) for key touchpoint feedback
Respondents will rate each question on the survey with a score between 0 (not at all likely) to 10 (extremely likely). Depending on the number rated, that response will fall into one of 3 categories to establish an NPS score.
When customers respond to the surveys and rate their interactions, their scores are formulated into a number between -100 to 100. Like any report card, the higher the score, the better the grade.
To calculate the final NPS, you will subtract the percentage of Detractors from the percentage of Promoters.
For example, if 10% of respondents are Detractors, 20% are Passives and 70% are Promoters, your NPS score would be 70-10 = NPS of 60