Bain & Co. developed Net Promoter Score in the 2000s to assess customer loyalty. Fred Reichheld, a researcher, and his team looked into whether there was a survey that could predict whether customers would continue to buy from them in the future.
After analyzing survey data and comparing it with purchase histories, they narrowed it down to the Net Promoter question. Even better, the NPS question was tied to customer loyalty and brand advocacy, repeat purchase, upgrades, renewals, and positive referrals.
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How can you calculate NPS?
The NPS formula works straightforwardly. After being presented with the question above, respondents choose a score, typically between 0 and 10, with 0 meaning they’re ‘not at all likely’ to recommend the company/product/service and 10 meaning they’re ‘extremely likely’ to recommend the company/product/service.
After all, responses have been gathered; they are divided into three categories.
- NPS Detractor: Scores 0-6
- NPS Passive: Scores 7-8
- NPS Promoter: Scores 9-10
To find the NPS, subtract the percentage of Promoters from the percentage of Detractors. Scores can be between -100 to 100, with scores above zero considered good. Passive scores are not included in the nps calculation because they aren’t supposed to help or harm.
How can you measure NPS?
NPS can be used to measure nearly anything. You can track the NPS of your entire organization and individual products, stores, and staff scores.
NPS can be integrated into customer experience strategies and marketing. You can use it with industry NPS benchmarks to compare your performance to other companies. This will allow you to better understand your market and how customers react to your product, service, and social media campaigns. It is important to build loyal customers who are brand ambassadors, not just consumers.
Employers can be surveyed and measured using NPS (eNPS).
Although most Net Promoter Score surveys collect customer feedback’s, they can also measure employee sentiment or what’s commonly called Employee Net Promoter Score (eNPS). eNPS measures how likely employees are to recommend your company to others.
Qualtrics advises against using the eNPS instead of a more thorough survey methodology like employee engagement surveys. eNPS is only one question, so it lacks the complexity of an engagement survey. Although it can provide a starting point, it doesn’t offer a comprehensive picture of employee health. Once you have the data, you will not know where to improve.
What is considered a good NPS?
NPS can range from -100 (all score 0) to 100 (10). A score of -100 doesn’t seem remarkable, which means that such companies have a lot to do to improve their CX. A good score does not necessarily have to be 100. 100 is a score that any company has yet to receive. Some brands, such as Costco and Starbucks, have high net promoter scores (above 70%).
Most companies consider any score between 0 and higher to be positive. However, the definition of a “good score” can differ from industry to industry. For instance, while the industry average is 40 for Consumer Brands and Fast Food, the industry average is -5 for Telecommunications/Cable/TV Services. It is essential to consider the differences in industry benchmarks when determining if your NPS score is high or low.
How user research can be used to complement NPS and increase CX?
Like many other quantitative metrics, NPS is a powerful indicator of a company’s strength in CX. However, it should be paired alongside qualitative insights to provide the context. Many companies use NPS to identify areas where improvements can be made, then gather customer insights through qualitative research such as usability studies to better understand how they got there.
It’s easier to understand your customers and adapt to their needs in the future by listening.
NPS can be viewed as a survey or A/B test. You can use it to guide you about your customers’ behavior, but you can’t know why without conducting user research. For example, if you have a high NPS, do qualitative research to discover what your customers love about your brand and service. Watch them navigate your website or app to get a gut-level understanding of the motivations behind that score.
It may be that your NPS is not high enough, but nearly all customers were having the same problem with your navigation. Or your pricing page does not clearly state what is included in the price. You may discover something your customers have experienced with you and can’t replicate elsewhere.
You can use the data you gather from customers to help you understand your NPS and take action. Once you have established a routine for conducting research, you can combine the NPS survey results and qualitative research to begin benchmarking your progress.
How can you create an NPS Survey?
NPS surveys can be created quickly, but you need to consider long-term data usage when planning how to administer them. Survey software is an option, but it will restrict your ability to act on the results since it only measures one metric.
To get a complete view of your customers, we recommend NPS or Customer Experience Management Platform. Customer experience management platforms can help you keep track of all interactions between your company and your customers, both present and future.
You can start an NPS survey by asking demographic questions such as income, gender, age, etc. These responses can help you segment your data during research and analysis.
The Net Promoter Score question
This is the main question that will determine your score. These questions are used to help you analyze your score data and follow up with the respondent to address any feedback.
Reasons for scoring
This open-text question asks the customer why they gave the numerical score in their central NPS question. This will allow you to identify the drivers of promoters or detractors in your responses.
What can we do to make your experience more enjoyable?
This question asks the respondent what they can do to improve their experience. This can be very helpful if you plan to do close-loop follow-up and customer ticketing. This will give you a head start in resolving the problem directly with the customer.
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Permission to follow up with the customer
It is a good idea to ask survey respondents if they can follow up with you. Not everyone will be willing to discuss an issue raised in a survey response. Depending on how your survey was distributed, you may have the customer’s phone number or email. If you do not, don’t hesitate to ask. If you can get their contact information with metadata from another system (similar to the demographic question), don’t ask. Your entire company must be involved in keeping customers satisfied enough to recommend your brand to others.
Ui UX design services
Our Ui UX design services help you improve your user’s experience and let them enjoy checking out your website or application. We help make your interfaces more user-friendly and efficient. UI/UX design services can also help you gather valuable feedback from customers to improve your product or service.
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