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About the Author: Markskrill
NPS, or Net Promoter Score, is a simple but powerful metric that can give businesses a clear pulse on customer loyalty and satisfaction. In a nutshell, it measures how likely your customers are to recommend your product or service to others.
The way it works is pretty straightforward - you ask customers a single question: "On a scale of 0-10, how likely are you to recommend [company/product] to a friend or colleague?" Customers who answer 9 or 10 are considered "promoters", 7 or 8 are "passives", and 0-6 are "detractors".
It is calculated by subtracting the percentage of detractors, or dissatisfied customers, from the percentage of promoters, who are highly satisfied and likely to recommend the business to others.
A higher NPS score signifies a larger base of loyal and enthusiastic customers who are more likely to continue doing business with the company and refer others, contributing to long-term success and growth..
The NPS is a concept and proprietary instrument developed by Fred Reichheld, who owns the registered NPS trademark in conjunction with Bain & Company and Satmetrix. Source: Net promoter score. (2024, June 21). In Wikipedia.
The truth is, a "good" NPS is pretty subjective and depends a lot on your industry. For example, the average NPS in the software industry is around 30-50, while in the consumer goods space it's more like 50-70. So don't get too hung up on a specific target number.
Instead, focus on consistently improving your NPS over time. Look at where you're losing points - are there certain customer segments or touchpoints that are dragging down your overall score? Dig into the feedback and use it to make real improvements to the customer experience.
Subtle adjustments can have a significant impact:
Remember, keeping your customers happy is like keeping a snag warm on the barbie – it's essential for a good time! So, focus on providing top-notch customer service and watch your business thrive.
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