Let’s start this off with a question, On a scale of 0 to 10, how much do you want to see your customers happy? 10 right? This is the same answer for every company. Companies live to satisfy their customers because customer dissatisfaction means loss.
When looking at Net Promoters and Detractors in a business, you want to look at customers who are likely to exhibit value to the growth of the business, these are Promoters OR those who are likely to take away that value from the business growth, and these are called Detractors.
What is Net Promoter Scale (NPS) and what does it measure
Net Promoter Score (NPS) is a widely embraced metric used in Customer Experience programs to measure customer loyalty and satisfaction. With a scoring scale ranging from 0 to 10, NPS categorizes respondents into three groups: Promoters, Detractors, and Passives. Promoters, scoring 9 or 10, are enthusiastic supporters who actively promote the business. Detractors, scoring 0 to 6, are unsatisfied customers who may share negative experiences. Passives, scoring 7 or 8, are generally satisfied but not loyal advocates. By comprehending NPS and its different segments, businesses can gain valuable insights into customer sentiment and tailor strategies to turn Detractors into Promoters. This proactive approach drives customer satisfaction, boosts brand reputation, fosters loyalty, and fuels business growth in the competitive marketplace.
To calculate the overall Net Promoter Score (NPS) for a company, it involves subtracting the percentage of Detractors from the percentage of Promoters. This simple yet powerful metric provides businesses with a clear measure of customer loyalty and advocacy. By analyzing NPS data and understanding the distribution of Promoters, Detractors, and Passives, organizations can gain valuable insights into customer sentiment and identify areas for improvement. This data-driven approach enables businesses to develop targeted strategies to convert Detractors into Promoters, enhance overall customer satisfaction, and drive long-term growth. Furthermore, monitoring NPS trends over time allows businesses to track their performance, make informed decisions, and continually enhance their customer experience to stay ahead in today’s competitive landscape.
Importance of NPS
NPS can be used as a predictor of your business growth. Whenever the company’s NPS is high this means the growth of your company is good and your company has a healthy relationship with its customers, you know this when you have customers who are likely to spread the word about your brand, products or services to promote a growth cycle for your company.
Keeping a NPS score will help to identify way forward to changing or promoting some of the things done in the company in order to keep the percentage of promoters on high or at least higher than the industry level.
Steps to make NPS useful for your Business
- Step 1: Reach out: There’s no way you will know whether a customer is happy or not without finding our directly from them. You want to hear it first hand from the customer, this is known as the “Voice of the Customer (VOC)”. Ask questions like, “How can we improve your experience?” “What do you like best/least about (company service or product?)”, “What is the one thing we could do to make you happier?” Or you could even ask “on a scale of 0 to 10, how would you rate (company service/ product?)
- Step 2: Work on the Feedback: Most companies fail to enhance their growth cycle since they can ask questions but do not give proper rectification of the responses they get. The Voice of the Customer (VOC) is intended to make sure you give the customer what satisfies their need. The first step to promoting the NPS is to work on the customer Feedback.
- Step 3: Maintain the NPS Statistics: Now that you have heard from the customer and found a way to implement improvements, you want to make sure that you create a culture for your company to strive in a positive growth cycle and stay there. Once you have maintained a level of customer satisfaction and happiness in the company your NPS will show a higher percentage of Net Promoters.
