Know the score.
The Net Promoter Score, or NPS®, is based on the fundamental perspective that every company’s customers can be divided into three categories: Promoters, Passives, and Detractors.
By asking one simple question — How likely is it that you would recommend [your company] to a friend or colleague? — you can track these groups and get a clear measure of your company’s performance through your customers’ eyes. Customers respond on a 0-to-10 point rating scale and are categorized as follows:
- Promoters (score 9-10) are loyal enthusiasts who will keep buying and refer others, fueling growth.
- Passives (score 7-8) are satisfied but unenthusiastic customers who are vulnerable to competitive offerings.
- Detractors (score 0-6) are unhappy customers who can damage your brand and impede growth through negative word-of-mouth.
To calculate your company’s NPS, take the percentage of customers who are Promoters and subtract the percentage who are Detractors.
MORE THAN A NUMBERS GAME.
Net Promoter programs are not traditional customer satisfaction programs, and simply measuring your NPS does not lead to success. Companies must follow an associated discipline to actually drive improvements in customer loyalty and enable profitable growth.
They must have leadership commitment, and the right software and business processes in place to deliver real-time information to employees, so they can act on customer feedback and achieve results.
The ultimate test for any customer-relationship metric is whether it helps the organization tune its growth engine to operate at peak efficiency. Does it help employees clarify and simplify the job of delighting customers? Does it help them identify and engage their best customers? Does it allow them to compare their performance to the best from week to week and month to month? The notion of Promoters, Passives, and Detractors does all this, and helps companies turn into Net Promoter stars.