The Net Promoter Score, or NPS®, was developed by Fred Reichheld, Bain & Company, and Satmetrix in 2003. It assumes that all customers can be divided into three categories: Promoters, Passives, and Detractors.
If you ask a rating scale question such as “How likely are you to recommend our company/product/service to your friends and colleagues?” you can analyse the responses to show how your customers see your company.
Responses are divided into three categories:
- Promoters (score 9-10) – Loyal customers who will keep providing revenue and promoting the company
- Passives (score 7-8) – Customers who may move to competitors
- Detractors (score 0-6) – Unhappy customers who can damage your brand
The NPS = (percentage of customers who are Promoters – percentage of customers who are Detractors)
There are some issues with using a Net Promoter Score. For example, people’s attitudes to a service may change over time, and if the company or product being asked about has a social stigma, people may not wish to recommend it, even if they like it.
The advantage of NPS is that it captures a key customer opinion with a single question.
The Snap Surveys Net Promoter Score workpack shows you how to set up an NPS question and display the results in a report.
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