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Net Promoter Score (NPS)

The Net Promoter Score (NPS) is a metric that helps determine the loyalty of an audience to a company. The essence of NPS is to survey customers in order to obtain their rating of the company's performance on a scale from 0 to 10. Based on the ratings obtained, a business can determine customers' attitude toward them. NPS measurement consists of several stages.

  1. Formulate a question that you will ask customers during the survey. The most classic options for questions are "What is the likelihood that you would recommend our product to a friend?" or "Are you willing to recommend us to others?". It is necessary to specify how the rating scale works. For example, 0 - I would not recommend in any case, 10 - I would definitely recommend.
  2. Determine the method of conducting the survey. To conduct the survey, an email newsletter, a phone call, or an online chat form can be used. The question should be asked when the customer has used the company's services and formed their opinion. For example, for an online store, this is not just placing an order, but the moment of receiving the goods.
  3. Determine the timing of the survey. NPS measurement can be ongoing and studied in dynamics, or it can be conducted at certain intervals. For example, once a quarter. It all depends on the company's characteristics and the flow of customers.
  4. Analyze the results. The collected data must go through an analysis that will help determine the audience's attitude to the company. Based on the information obtained, you will make decisions about further actions. For example, segment the audience by loyalty level.

Customers who participated in measuring the Net Promoter Score are divided into three groups, depending on the rating:

  • 9-10 points — promoters. The audience that is most loyal to the company. These people are ready to recommend your product to others and leave positive reviews about you;
  • 7-8 points — neutrals. The audience that has not formed its final opinion about the company. These customers are not impressed with the company but are not dissatisfied with it either. They may go to competitors if they offer a more advantageous offer, or become promoters if additional work is done with them;
  • 0-6 — critics. They do not like the user experience they received and may leave a negative review about the company. The task of the business is to minimize possible reputational damage from such customers.

To calculate the NPS directly, you need to find out the percentage of promoters and critics out of the total number of respondents. For example, 300 people took part in the survey, of which 60 were promoters and 15 were critics. Then there will be 20% promoters out of the number of respondents, and 5% critics. NPS is calculated as the difference between these two indicators. In our case, NPS equals 15%.  According to accepted standards, such a level of loyalty is considered low and may indicate problems that the company is facing in working with its audience. NPS above 30% is considered good, and above 50% is considered excellent.

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