NPS calculation: how to calculate your Net Promoter Score?
Published on November 20, 2023 - Updated on December 05, 2023
Net Promoter Score: definition, importance and calculation method
When it comes to tools for assessing customer satisfaction, the Net Promoter Score stands out as a particularly interesting tool for gaining a quantitative perspective on how customers perceive a company, going far beyond the usual simple satisfaction indicators.
In this article, we take a closer look at the methodology behind NPS calculation, how it works, why it's important, and tips for correctly interpreting the results. Details to follow!
Definition of Net Promoter Score (NPS)
The Net Promoter Score (NPS) is a method of evaluating customer satisfaction and the ability of those same customers to recommend a brand.
The NPS is based on a simple, straightforward question: "On a scale of 0 to 10, how likely would you be to recommend our product/service to a friend or colleague?
The NPS then categorizes customer responses into three distinct groups:
- promoters (rated from 9 to 10),
- passives (rated 7 to 8),
- and detractors (rated from 0 to 6).
Why use the Net Promoter Score to assess customer satisfaction?
Using the Net Promoter Score (NPS) to assess customer satisfaction offers a number of advantages, including :
- ease of use,
- ease of large-scale data collection, through a single direct question,
- the generation of clear, quantifiable answers, enabling rapid assessment of customer loyalty,
- segmentation of respondents into three distinct categories (promoters, passives and detractors),
- the ability to access
nuanced understanding of customer perceptions,
- effective targeting of specific areas requiring improvement, while identifying strengths to be further reinforced,
- assessing the impact of emotions on customer relations,
- not to mention strengthening brand reputation and stimulating growth.
What is a good Net Promoter Score (NPS)?
The NPS calculation formula then subtracts the percentage of detractors from the percentage of promoters, generating a value between -100 and +100.
In this logic, a positive NPS indicates strong recommendation potential, while a negative score suggests a need for improvement.
Companies generally aim to maintain or improve their NPS over time. It should be noted that the interpretation of a "good" NPS may also depend on the company's industry norms and sector expectations. So, rather than setting a threshold to reach, it's often better to monitor your own NPS to identify any trends, and take corrective action as soon as necessary to maintain or improve customer satisfaction.
Steps to follow to calculate your Net Promoter Score
To calculate your Net Promoter Score, it is essential to follow certain key steps, namely :
- collecting the data needed to calculate your NPS,
- transforming this data into a customer satisfaction score,
- interpreting the results obtained,
- then adding qualitative and factual data to finalize the interpretation of the Net Promoter Score.
Step 1: Gather the data you need to calculate your NPS
The first essential step in calculating your Net Promoter Score is to gather the essential data needed to assess customer satisfaction.
This involves collecting responses to the key NPS question: "On a scale of 0 to 10, how likely would you be to recommend our product/service to a friend or colleague?", from the target audience.
Once the answers have been collected, it's time to centralize them to obtain the base needed to calculate the NPS.
Step 2: transform your data into a customer satisfaction score
The second fundamental step in calculating your Net Promoter Score (NPS) involves transforming the data collected into a meaningful customer satisfaction score.
To do this, subtract the percentage of detractors (those scoring 0 to 6) from the percentage of promoters (those scoring 9 or 10).
This operation generates a score between -100 and +100. Then all you have to do is interpret the NPS correctly.
Step 3: Learn how to correctly interpret your Net Promoter Score
Once you've collected all the desired responses and transformed this data into a customer satisfaction score, it's time to interpret it to identify your opportunities for improvement.
A positive score indicates a high potential for recommendation, while a negative score suggests significant opportunities for improvement. The process of converting raw data into a clear metric
into a truly clear metric offers a synthetic view of your customers' loyalty and satisfaction, while providing you with a solid foundation to guide your continuous improvement initiatives. No more, no less.
Step 4: finalize the interpretation of your Net Promoter Score with other qualitative and factual data
Last but not least, finalize the interpretation of your Net Promoter Score (NPS) by integrating quantitative, qualitative and factual data.
Here are some ideas for qualitative data you can collect from your customers to feed into your NPS:
- Why did you give this rating?
- What aspect of our product/service do you like best?
- Do you have any suggestions for improvement? If so, which ones?
Next, here are a few tips for collecting equally important factual data:
- number of page views,
- bounce rate,
- time spent on each page.
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