A Guide to Net Promoter Scores

Why care about a net promoter score

For any business, measuring customer satisfaction, and acting upon the findings, is key to success, growth, and reputation.

There are a number of ways to understand the customer experience, including measuring the net promoter score of your business.

What is a net promoter score?

Net promoter score, or NPS, is a customer satisfaction metric that measures how loyal customers are to your company and how likely there are to recommend your product, service, or business to others.

The NPS is calculated by asking customers wording such as: “On a scale of 0 to 10, how likely are you to recommend this product/company to a friend or colleague?”

Calculating the NPS score

Once your customers have answered the question, they are divided into three groups, based on how they scored the business or product.

Promoters

These customers gave the business a score of 9 or 10. They are the company’s most loyal and enthusiastic customers, meaning they are likely to act as brand ambassadors.

Passives

These customers gave the business a score of 7 or 8, meaning they are unlikely to actively recommend a business, but they also aren’t likely to talk about it negatively.

Detractors

These customers answered with a score between 0 and 6. They are unlikely to recommend the product or service, probably won’t be returning customers, and may discourage other potential customers.

Once you have broken the customers down into these categories, NPS is calculated using the following formula:

NPS = % promoters – % detractors

How MMC Research & Marketing makes it special

Depending on areas of the business that our clients want a deeper level of knowledge, we’ll probe further. For example, we may measure perceptions around various departments within the business, or their perception of product or service types. We can then link this back to NPS scores and identify factors influencing /shaping these perceptions.

We’d even recommend a deeper dive by running some qualitative research too. This way we can find out why people gave a certain score. The deeper level of insight helps us then make recommendations for improvement.

And because, comms and marketing strategies are a speciality here at MMC Research & Marketing, we’re likely to provide strategic recommendations to make improvements based on feedback.at are the benefits of using a net promoter score.

Measure the likelihood of repeat business

By measuring loyalty, NPS allows businesses to identify the likelihood of new and repeat business. This data can then be used as a basis for forecasting business growth, cash flow, and brand health.

View the bigger picture

Unlike other customer satisfaction surveys, NPS surveys don’t just focus on one interaction. Instead, they reveal the bigger picture – how your customers feel about your business as a whole, rather than a particular purchase.

Benchmark your business against competitors

NPS is a standard benchmark that is used by companies around the world. This makes it easier for you to track your progress against your competitors and others within your sector.

User-friendly

For customers, NPS surveys are quick and simple to complete, usually taking no more than a couple of minutes. this makes it more likely that they will take part.

How can net promoter scores inform your decisions?

The net promoter score can be used to inform a number of areas within a business, including:

Customer service
Marketing and communications
Product development
Business development
Customer retention

How often should you run a net promoter score?

At MMC Research & Marketing, sometimes we run net promoter scores as a stand-alone market research project and sometimes we weave in net promoter score questions within other customer surveys, if appropriate.

When it comes to how often you should measure NPS, there is no one-size-fits-all rule. It depends on factors including:

The sector
The amount of repeat customers the business has
The extent to which the business can influence customer satisfaction
Whether it makes sense to run NPS at certain points in the year based around campaigns or seasonality

If, for example, you’re a fast-paced business with customers who could source the product/service in question from a wide variety of providers, ongoing NPS measurement is usually recommended.

Clients that we work with would typically run an annual survey and, more often than not, they’ll tie it in with some depth interviews to understand their customers’ thoughts at a deeper level.

Any organisation that we run any kind of customer service project for receives a bespoke solution created for them, so we’d recommend meeting with you first to get an understanding of what is important to your business.

IAMProperty is a MMC Research & Marketing client that we delivered a net promoter score survey for in 2021 and are already working on 2022’s. Whilst they were happy with their score and the deeper level of insights MMC delivered, they’re keen to go out to market again to make sure customers are still satisfied.