Net Promoter Score (NPS) is a critical metric in tracking customer loyalty. It is one of the most practical methods for gauging the attitudes and behaviors of customers.
It involves asking about how customers would recommend your company to others. Since it can be hard to gauge how customers might feel about you exactly, NPS helps paint a clear picture.
In this ultimate guide, our net promoter score company thoroughly explains everything you need to know about this widely used customer satisfaction metric.
NPS is a metric that’s grown more and more in popularity over the past decade. It’s probably one of the most, if not the most common metrics or KPIs used in market research and in customer satisfaction surveys.
Better yet, NPS can reveal where a company stands against its competitors. And with up to 56% of professionals using some form of competitive research, it’s a metric you don’t want to ignore.
Essentially, NPS measures total satisfaction – it focuses on loyalty to a product, service, or organization.
It’s measured using a zero to 10 scale, AKA, the Likert scale.
Made up of 11 points, a zero on the Likert scale would be not at all likely to recommend, and 10 would be very likely to recommend, or extremely likely to recommend.
These measurements are accomplished through a scaling question such as “On a scale of 0 to 10, how likely are you to recommend our business to a friend or colleague?”
The outcome and the NPS score can range anywhere from -100 to +100, with -100 being the worst case, and +100 as the best case.
Here’s where the three main groupings come into play:
A net promoter score calculation is the difference between the percentage of promoters and the percentage of detractors.
When the numbers are run on the back end, the difference between those two audiences is taken.
If you have 75% of promoters and 10% of detractors, your NPS is going to be +65. If you have 25% of promoters and 50% of detractors, your net promoter score is going to be -25.
To learn more, read our case study How To Conduct A Net Promoter Score (NPS) Study.
This is a little bit of a loaded question, but one that our market research company gets asked a lot. And that’s because NPS ranges quite a bit by industry, product, or service.
If your net promoter score is positive, that’s a decent sign, because you have more people who are promoting your brand than detracting from it. This is always a good starting point.
You don’t want to see a negative NPS, because that means you have more detractors than promoters of your product.
Typically, the +20, +25, and +50 range is usually considered a good net promoter score. If you have an NPS of 50 or higher, that’s a great ballpark.
If there isn’t any context for benchmarking, calculating NPS can be tough.
When someone reports an NPS of +40, you’ll be wondering if that’s good or bad. It’s always important to have some context that you can look into.
Again, NPS is one of the most common metrics in market research–there’s tons of secondary research on NPS scores for specific brands for specific industries.
It’s also key to benchmark against yourself. If it’s the first time you’re venturing into the NPS space in your survey, you always want to benchmark yourself against your scores from your last quarter.
And of course, you need to benchmark against the competitors.
This can be difficult to do with a customer satisfaction survey, or client satisfaction survey because you probably don’t want to be referencing competitors as part of that survey.
However, you can ask (generally) how likely respondents are to recommend other products they used.
If you’re doing something through a third party, see if they’re doing a brand equity survey or an image and awareness survey. Or, see if they’re reaching out to the general population.
In these cases, they’d be able to collect NPS not only for your company but also for some specific competitors.
Being able to use NPS data and apply it into your business is why it’s so powerful. NPS is how customers feel about your business. It’s a good way to indicate the health of your business and potential growth in the future.
When your NPS is high (when you’re receiving great feedback) customers are more than likely to act as “promoters” (literally) for your brand. By always recommending your company or generating good word of mouth, they act as just another channel your business can grow.
On the other side, a bad/poor NPS score can reveal issues within the business. It can help you identify areas of improvement and even help you change your strategy in order to fill in the missing pieces. It might indicate customers are not happy and would not recommend your business (which can hurt in the long run).
Here’s some questions you can ask in your next NPS survey:
How important are each of the following factors when selecting a company to work with like [example organization]? Select one for each.
Achievement of business outcomes
How satisfied are you with each of the following aspects of [example organization]? Select one for each.
How satisfied are you with each of the following [example organization] employees? Select a rating for each
If [example organization] focused on doing one thing better to improve your satisfaction as a customer, what would it be? Enter your response below.
NPS is a quantitative metric. What does this mean? It means that by design, NPS is designed to measure.
Because it’s a quantitative metric, you’re a little limited with how you collect that metric.
Of course, the world of market research has evolved quite a bit in the past two decades.
Various types of market research like phone surveys, intercept surveys, in-person surveys, and mail surveys, have been used far less by brands over the years.
So, how do we recommend you collect your NPS? With online surveys, of course. Luckily, they are cost-effective and provide insights fast.
Here is the process our online survey company follows to collect NPS on behalf of our clients.
The first step to conducting an NPS survey is by figuring your goals and objectives with the survey.
This will determine what you want to accomplish with your survey and make the rest of the work that goes int your survey much easier. When you think of how you want to complete your survey, relay back to your goals to figure that out.
In many cases, we work with our clients to find their goals and objectives to know what would make a successful project, we usually do so in a kickoff meeting. at the start of the project.
Next, defining your audience, typically part of your customer base (if not all of your customers) is what you need. You’ll need to know who you want to survey to get the best data.
NPS typically work the best by asking your customers but theres also other types of NPS like eNPS which ask your employees instead.
There’s no right or wrong answer, you just need to be able to figure out who it is you want to survey.
This will make writing the questions much easier.
Similar to the example questions above, you’ll want to write your questions that tailor to both your audience and your goal. With NPS, this is generally pretty straightforward but can be more in-depth if needed.
You generally want to keep the survey short, but it doesn’t mean you can’t ask the important questions you want to.
Make sure to write engaging and relevant questions that lead you to your end goal. We help all of our clients do this by writing the questions for them that are specifically targeted for market research projects to collect unbiased data and get the most responses.
The survey design and programming are pretty straightforward when calculating your net promoter score.
The survey typically includes two to three questions:
However, our team can customize the survey based on your unique needs. For instance, say we’re measuring a bank or credit union’s NPS.
This could be a good time to ask other one-off questions to better understand the drivers of branch loyalty and member satisfaction.
Once the survey is programmed and tested, our market research company moves on to fieldwork.
You can usually send your participants an email survey invitation or any other method to get them to participate. You’ll want to get as many responses as possible while also maintaining data integrity and quality.
With our clients, we typically have a reporting dashboard shows results in real-time. As soon as someone takes the NPS survey, you will see their feedback and can begin building customer loyalty strategies.
Lastly, you’ll want to analyze your survey we responses. At Drive Research, we always offer various reporting packages that help cover everything in-depth.
It can be as simple as an export of the results in an Excel spreadsheet, a topline report recapping key takeaways, or a comprehensive report sharing our expert recommendations for how to take action with the data.
You’ll always want to do more than just look at your data. Figuring out more like trends, deeper insights that can help you piece together more critical information will help you get an edge from your market research.
We always go above and beyond for clients by providing them with some of the best insights in market research (and that’s why a third party is best for your NPS surveys)
It all depends on your business model. Obviously, there are different kinds of trends in terms of calculating NPS regularly.
This often occurs when measuring net promoter scores for retail stores. Customers will get an email sent to them asking about customer satisfaction, potentially NPS.
But there are all kinds of other options such as quarterly, depending on your business model.
If you’re a professional services organization, and you don’t onboard a ton of clients, it may not make sense for you to send regular surveys.
At the very least, we will say that regardless of the business or product type, you should be at least tracking NPS and general CSAT metrics on a yearly basis.
It just makes for good business– having those built into your scorecards as part of your goals and objectives.
This should be applicable to all types of businesses or organizations.
Another common time to track NPS is if you’re going through any major changes within the customer experience.
If you’re rolling out a new training procedure, or new training protocol, you want to understand how that’s impacting NPS and some of those other CSAT factors.
In those cases, it’s better to have some type of benchmark and early understanding of those changes rather than waiting.
Something else to keep in mind, you know, a good time to measure CSAT and NPS is right after significant changes–whether it’s operational or strategic.
Recommended Reading: The Benefits of Continuous Customer Feedback Surveys
So, after all of this, how else can you use your NPS findings?
The beauty of NPS is that it’s so simple–even those who aren’t familiar with market research will be able to conduct it.
At Drive Research, we spend a lot of time talking to our clients about common areas in that they can use our results.
One area is for operational use.
Our clients are learning from their customers and they’re taking those learnings and building them into various protocols.
A second is marketing.
Conducting market research can always benefit a brand’s marketing strategy. That could be a messaging channel, that you’re marketing to profiles of your best customers–there are all types of learnings that you can use.
You’ll want to feature the NPS pages on your website, to give potential customers insight into your brand.
Simply understanding someone who maybe sees that it could impact or at least accelerate their path to purchase can make a big difference.
Additionally, any way you can carve up the content to use for other purposes is huge.
Consider additional content pieces–things like white papers or compare cards. Both of these are great ways to expand on what the original survey found.
And obviously sales collateral–you have internal decks and salespeople that are using this as part of their day-to-day calls, meetings, and things like that.
And then, there’s strategy.
How can you shift your strategy? Or should we be focusing more on one area of our business versus another? Is there a cross-selling opportunity between our clients from different areas of business?
While results can’t be controlled, if an NPS score is positive, we can run a crosstab to understand how demographics play a role.
We advise our clients to refresh their NPS yearly, to have accurate benchmarking data for the best results.
If your company is looking for the best way to run an NPS survey, you need to know why using a third party is the best option.
Alternatives like do-it-yourself survey software or running it yourself come with privacy and data complications, plus a lot of extra time invested. These methods are going to rely on your ability to do everything yourself.
With a third party NPS survey company, like us at Drive Research, you’ll get a completely done-for-you solution and an expert team that acts as your full-time market research consultants. A lot of clients come to us because they want experts handling their surveys and especially their data analysis (and expert insights that come after) for them.
We’ve got the process from kicking off your project by figuring out goals to completing the project with you by going over and reporting on your data. We’re committed to keeping your data as high quality as possible, private, and covering it completely during the data analysis stage.
If you’re interested in how we as a third party survey company can help you, contact us today for a free quote.
You’re an NPS expert now, right? Just kidding. But we hope you know a little more about this topic than when you first started reading our blog!
If you’re interested in working with a market research company to measure NPS and other key performance indicators, we can help with that too.
Drive Research is a national market research company offering services to clients all across the United States. Our range of market research services includes online surveys, customer satisfaction, focus groups, and more.
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