With one simple question, you can better understand how happy your customers are with your products and services. That’s what the Net Promoter® Score (NPS) is all about: it’s a way for businesses to measure customer loyalty and satisfaction.
What’s your Net Promoter Score? To find out, just enter the number of times you received each score into the following blank spaces:
Net Promoter Score and NPS are registered trademarks of Bain & Company, Inc., Fred Reichheld and Satmetrix Systems, Inc
Your score comes from the Net Promoter Score question, which typically takes the following form:
“How likely is it that you would recommend (name of organisation, service or product) to a friend or colleague?”
The question prompt should be followed by a rating scale asking the respondent to select a number from 0 (least likely to recommend) to 10 (most likely to recommend).
Depending on the number that each customer selects, we’d group them into one of three groups:
The NPS is the world’s leading metric for measuring customer loyalty and satisfaction.
Here are three main benefits of using the NPS:
This is only a fraction of the benefits of using the score. To learn more, read our guide to using NPS surveys to create the best customer experience.
Having your NPS survey available electronically means that you can quickly receive responses and calculate your NPS. Let’s suppose you’ve received 100 responses from your customers. We’ll turn this figure into an NPS percentage. You can compare this NPS to other companies, your industry benchmark or the previous NPS figure you’ve generated.
The NPS system will provide a percentage based on the proportion of respondents who fall into the detractors, promoters and passives categories. To calculate the percentage, follow these steps:
Your NPS will be between -100 and 100. Once you have your NPS results, you can set targets to improve.
Related reading: 10 tips to build stellar NPS surveys
Once all your responses are in, you can work out your score using the following Net Promoter Score calculation:
To help you understand this formula, let’s walk through a brief example. Let’s suppose you’ve collected 150 responses to your NPS question. The distribution of the scores looks like this:
This means you have 80 promoters, 30 passives and 40 detractors. To calculate the percentage of promoters, use the following formula:
% of promoters = (No. of promoters / No. of respondents) x 100%
To find the percentage of detractors, use the same formula. Just substitute the total number of promoters for the total number of detractors.
This means you have 80 / 150 * 100% = 53% promoters, while your percentage of detractors is 40 / 150 * 100% = 27%.
Subtracting the percentage of detractors from the percentage of promoters gives you the Net Promoter Score:
53% – 27% = 26%
You’ll notice that the score is positive. This isn’t always the case. Net Promoter Scores can range from -100 to 100, depending on the scores and distribution.
A ‘good’ score is hard to pin down. Unfortunately, there isn’t a one-size-fits-all answer. Scores can vary dramatically depending on factors such as industry and company size. This means that you’ll need to benchmark your score against competitors that are similar to your organisation to truly find out where you stand.
SurveyMonkey Benchmarks can help you do just that. When you use SurveyMonkey to ask an NPS question, the platform automatically calculates your Net Promoter Score and allows you to compare it to other companies of your size in the same industry.
You can compare your NPS to industry averages or competitors to see how your company is doing.
NPS benchmarks vary according to the industry. Some sectors have a much higher proportion of happy customers, so you should expect inflated figures if you work in this industry.
Here are some business-to-consumer (B2C) NPS benchmarks by industry:
Insurance | 71 |
Ecommerce | 62 |
Retail | 61 |
Financial services | 56 |
Healthcare | 38 |
Communications & media | 29 |
Internet & software services | 4 |
Here are some business-to-business (B2B) NPS benchmarks by industry:
Consulting | 68 |
Technology & services | 61 |
Digital marketing agency | 60 |
Construction | 45 |
Logistics & transportation | 43 |
B2B software & SaaS | 40 |
Cloud & hosting | 25 |
If the NPS of your business falls below your industry average, you should aim to improve it. You know you’re doing something right if you’re above average!
A transactional NPS focuses on certain customer interactions, generating data immediately after a customer engages with a certain part of your business. For example, you could send out a tNPS survey straight after a customer does the following:
Automating these at various points in your customer journey will allow you to gather specific NPS data. Calculating and interpreting your NPS from tNPS surveys will generate feedback about what’s working and what you could improve.
A higher tNPS suggests that the particular function is intuitive for customers. If you receive a low tNPS, you can highlight this function that your business needs to work on in the future.