The Incredible Value Net Promoter Score (NPS) Can Bring to Your Company

Wouldn’t it be nice if everyone you do business with would tell their colleagues and friends to use your company? Would you at least like that to happen more often?

For many years, companies have studied consumer behavior to understand who is in their target audience, how customers think, and what drives them to purchase one product or service over another. Researchers have employed a variety of strategies to uncover the motivations, attitudes, and issues which drive decisions, while marketers have struggled to translate this into the 4 P’s – Product, Price, Place, and Promotion. However, it was the question which was asked by C-level executives (What do consumers think of our brand?) which lead to development of the Net Promoter Score (NPS) process.

NPS is basically a simple measurement.

It is based on the premise that if enough people recommend you, you should be able to grow your business. In case you are not familiar with it, NPS in its most basic form asks the customer two questions:

• On a scale of 0 to 10, what is your willingness to recommend our company to friend or colleague?
• Why do you give that rating?

To get the actual score, respondents are classified into three groups based on their rating of willingness to recommend:

• Respondents giving a rating of 9 or 10 are classified as promoters
• Respondents giving a rating of 7 or 8 are classified as neutral
• Respondents giving a rating from 0 to 6 are classified as detractors

The percentage of respondents that are promoters minus the percentage of respondents that are detractors gives you the NPS.

However, valuable NPS is not that simple.

To achieve value from NPS work, it is necessary to ask additional questions to really understand what each respondent would say if someone asked them about your company. These responses can be used to validate each respondent’s classification. In doing so, look for distinctions between:

• Active promoters
• Passive promoters
• Those who are happy, but specify why their needs fit your offerings
• Those that are truly on the fence, giving bad points along with good points
• Then there are customers that might like you to some extent, but prefer a competitor
• Those that are not satisfied, but won’t tell everyone they know
• And finally, customers who are active detractors or trolls

This also suggest ways to address customer issues. 

More importantly, you need to know how to identify what needs to improve so you can be a better partner to your customers. By clarifying where a customer truly stands on the promoter/detractor scale, it becomes much easier to determine what needs to be done to improve your score. Look for the “low hanging fruit” and identify what needs to happen in order for passive promoters to become active promoters and fence sitters to move up to passive or active promoters.

This is the difference that makes NPS a valuable tool rather than just a number.