What is NPS in Market Research? | Net Promoter Score

Net promoter score (NPS) has become a commonly used metric in market research surveys.

NPS has now become a staple in customer satisfaction (CSAT) surveys across the globe. It provides an analyst with several benefits beyond the standard likert scaling question and is fairly easy to understand.

Our market research company recently created a short video on this exact topic.

Prefer to read? Navigate to each section of this blog post by clicking the titles below.


What is Net Promoter Score?

NPS involves asking your customers one simple question, "How likely would you be to recommend [INSERT PRODUCT, SERVICE, BRAND] to a friend or colleague?" 

The survey respondent must answer this question by using a 0 to 10 scale, where 0 is not at all likely, and 10 is very likely to recommend.

While you can conduct an NPS survey asking customers this one question, our market research company recommends including this among a 10 to 15 question customer satisfaction survey.

This will allow you to ask customers follow-up questions such as:

  • Why are you likely or not likely at all to recommend [INSERT PRODUCT, SERVICE, BRAND] to a friend or colleague?
  • How could we improve our product/service?
  • Why did you choose our product/service over a competitor?

It may also be helpful to gather demographic information by asking respondents their name, age, and gender in order to utilize customer segmentation within your marketing. 

Need more customer survey question examples? Our team shares their favorites in this video.


How is NPS calculated?

Again, NPS is calculated by asking a customer how likely they are to recommend to product, service, or brand by using a 0 to 10 scale. 

This question is nothing new, but how the answers are grouped after in analysis is what makes NPS.

To calculate your company's net promoter score you must:

Add the percentage of those who selected "9" or "10" (very likely) and subtract out those who selected "1" through "6."

This difference is your NPS. Scores can range from -100 to +100.

Interested in measuring the NPS of your brand, product, or service? Our customer survey company can help! Contact us here.

how is NPS calculated example


What are the 3 groups of NPS?

NPS groups the scores into 3 distinct categories:

  1. Promoters
  2. Passives
  3. Detractors

Arguments can be made about the scaling but nonetheless, this is how NPS is grouped.

1. Promoters

Promoters are those who rated your brand very likely to recommend by providing a "9" or a "10."

These customers are those who actively promote your brand in the community or are labeled as brand advocates.

2. Passives

Passives are those who rated you somewhat likely to recommend by providing a "7" or an "8".

These customers are those who do not feel a strong affinity to your brand and can be easily swayed by competitive offerings.

3. Detractors 

Detractors are those who rated your product, service, or brand not at all likely to recommend by providing a "1" through "6".

These customers are those who actively detract from your brand in the community. They willingly offer up poor reviews and hurt your brand.


What are the benefits of measuring NPS?

For the past 10 years, NPS has been a very popular question to include in a customer survey. Why?

It's easy to comprehend and easy to measure.

Subtracting the percentage of "1s" through "6s" from the "9s" and "10s" is an easy calculation.

Benchmark results against competitors. 

Because so many companies use this metric it is fairly easy to benchmark yourself against your competitors within your vertical or industry sector.

A quick Google search on NPS will reveal all kinds of competitive benchmarks for you to compare your NPS.

Likelihood to recommend has always been a popular question to ask in market research, but NPS refreshes this concept a bit because brands are now able to compare and rank one another. 

Share your NPS in marketing materials.

Companies who have a positive NPS often share their scores on a variety of marketing materials to increase new customer acquisition. It is similar to the benefit of having positive online reviews.

Compare progress year-to-year.

the NPS rating across internal newsletters, its intranet, and flyers. It helps the company understand and benchmark performance year-to-year.


I have my NPS, now what?

The NPS School of VoC and CX teaches you that your focus should be on the passive audience (those rating likelihood to recommend a "7" or "8.") VoC training states efforts to convert the detractor audience (those rating you a "0" through "6") are not totally for naught, but requires a lot of work.

From a business operations standpoint, the ROI is not as strong for your time. Whereas the passives can be more easily swayed into the promoter group (those rating you a "9" or "10.") Conduct further research on those who love your product or service and actively promote it to learn from them.

Use this messaging to influence the passive group. By chance, you may also sway some detractors up the ladder.


Contact Our Market Research Company

Drive Research is a national market research company in Upstate NY offering services to clients all across the United States. Our range of market research services includes online surveyscustomer satisfactionfocus groups, and mystery shopping.

Interested in measuring NPS for your organization? Contact us through any of the four ways below.

  1. Message us on our website
  2. Email us at info@driveresearch.com
  3. Call us at 888-725-DATA
  4. Text us at 315-303-2040

Author Bio George Kuhn

George Kuhn

George is the Owner & President of Drive Research. He has consulted for hundreds of regional, national, and global organizations over the past 15 years. He is a CX certified VoC professional with a focus on innovation and new product management.

Learn more about George, here.

 


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