Understanding the Net Promoter Score
There is some confusion about what a net promoter score® actually is. Some people consider it to be the percentage of customers who would happily and willingly promote a particular company. This isn’t actually the case. The net promoter score isn’t a percentage, it’s an absolute number that’s arrived at by figuring percentages.
Net Promoter Score is an absolute number
Let’s say, for the sake of simplicity, that one hundred customers answer a survey question, “How willing would you be to recommend our company to your friends and family?” The customers are then given a scale of one to ten, with ten being “very willing” and one being “not at all.” The customers then choose one of these numbers to reflect their degree of willingness to recommend the company they have made a purchase from.
Anyone who chooses the number one, two, three four, five or six on the scale is defined as Set A and considered to be either an active detractor or an unsatisfied customer and certainly not someone who would be promoting the company. Those choosing seven or eight are Set B and are considered relatively neutral. They may not be actively hostile, but they probably won’t recommend the company and are most likely one time customers. The people who choose the number nine or ten are Set C and are likely to be active promoters who will probably recommend the company at least once and will probably buy again.
Set A: Score 1 – 6 = Detractor
Set B: Score 7-8 = Passive
Set C: Score 9-10 = Promoter
The net promoter score is arrived at by adding up the total number of responses from each set, and dividing each set individually into the total number of responses to the survey, this tells you what percentage of the total responses each set represents. Now subtract the result for Set A from the result for Set C and you have your net promoter score.
It’s important to remember that the net promoter score doesn’t answer the question, “Why?” It doesn’t tell you why people are in Set A, B or C. It only gives you a number. The real work begins after you get that number. This is where the Ezisay platform helps to provide actionable insights, by immediately asking respondents for the reason for choosing a certain score – helping to answer the “Why?”.
NPS can be a useful adjunct to other metrics and it gives a satisfaction rating that’s easy to understand. But, it’s only really important as a starting point. It tells you where your company stands with regard to customer relations. Where you go from there is up to you.