What Is A Net Promoter Score?
Net Promoter or Net Promoter Score (NPS) is a management tool that can be used to gauge the loyalty of a firm’s customer relationships. As an alternative to traditional customer satisfaction research, NPS has been widely adopted with more than two thirds of Fortune 1000 companies using the metric.
How Is Net Promoter Score Calculated?
The Net Promoter Score is calculated as the difference between the percentage of Promoters and Detractors. The NPS is not expressed as a percentage but as an absolute number lying between -100 and +100. For instance, if you have 25% Promoters, 55% Passives and 20% Detractors, the NPS will be +5.
What Does A Net Promoter Score Mean?
NPS measures the willingness of customers to recommend a company’s products or services to others. It is used as a proxy for gauging the customer’s overall satisfaction with a company’s product or service and the customer’s loyalty to the brand. An NPS that is positive (i.e., higher than zero) is felt to be good, and an NPS of +50 is excellent.
