Net Promoter Score (NPS)
In today’s competitive business landscape, understanding customer sentiment is crucial for growth and long-term success. One of the most effective and widely used tools to measure customer satisfaction and loyalty is the Net Promoter Score (NPS).
But what exactly is NPS, and why is it so valuable for businesses?
-The only way to grow is to treat customers so well they came back for more and tell their friends about us. That’s how we’d all like to be treated as customers. Golden Rule behaviour is the basis for loyalty. And loyalty is the key to profitable growth- – Andy Taylor – CEO Enterprise
What is NPS?
NPS is a simple yet powerful customer survey metric that gauges customer loyalty by asking one fundamental question:
“On a scale of 0 to 10, how likely are you to recommend our company/product/service to a friend or colleague?”
Based on their responses, customers are categorised into three groups:
- Promoters (8-10): Loyal enthusiasts who will keep buying and refer others.
- Passives (6-7): Satisfied but unenthusiastic customers who are vulnerable to competitors.
- Detractors (0-5): Unhappy customers who may discourage others from engaging with your business.
The NPS is calculated using the formula:
NPS = % of Promoters – % of Detractors
This score can range from -100 to +100, with higher scores indicating stronger customer loyalty.
For example, if you analyse your NPS score, and you have 68 promoters and 48 detractors then your NPS Score is 68 – 48 = 20
NPS is valuable because it provides a simple snapshot of overall customer sentiment, guiding improvements in customer experience and business performance.
-There is only one boss. The customer. And he can fire everybody in the company from the chairman on down, simply by spending his money somewhere else – Sam Walton
-My mother always taught me to treat other people the way I want to be treated and to have respect for other people- – Pierre Omidyar – eBay Founder
How you can use NPS in your business
Net Promoter Score (NPS) is a simple survey metric which you can use to get the customer’s views on your business.
It is based on the fundamental perspective that every company’s customers can be divided into three categories:
- Promoters
- Loyal enthusiasts who keep buying from the company and urge their friends to do the same
- Passives
- Satisfied but unenthusiastic customers who can be easily wooed by the competition
- Detractors
- Unhappy customers who will bad-mouth your business
Setting up the system
Step 1.
Agree the wording for the primary question:
-On a scale of 0 to 10, how likely are you to recommend our company/product/service to a friend or colleague?-
For our clients we suggest an optional additional question:
-Please tell us one improvement we could make to increase our score-
We find the information from this question can be very valuable in giving the business a quick synopsis of the issues that are at the forefront of the customer’s mind.
Step 2
We suggest setting up the system in both pen and paper format and also in a digital format.
The paper format can be handed out at the point of payment, or the digital version can be sent with invoices or as a survey.
The system works best when every customer gets the opportunity to make their comments.
Make sure to capture the necessary contact information in both formats. This allows for customer follow up and further information or discussion as required.
Step 3
Introduce the system to all management and staff and fully explain how NPS works and the advantages of customer feedback.
Here it is worth emphasising that customer care is a business strategy and NPS is a tool within this strategy.
The objective is to create more loyal customers by getting as many Detractors and Passives into the Promoter category.
This is a key step in the process as staff buy-in for the system is vital for success.
Step 4
Introduce the NPS system.
Many companies simply replace the standard comment card system with an NPS format.
Step 5
We suggest that one person in the organisation becomes the NPS co-ordinator and produces a weekly or monthly analysis. This will require an amount of time to catalogue the results and, where necessary, contact the customers.
Many hospitality operations find it preferable to have a weekly analysis as this allows immediate focus on issues that arise from the secondary question.
It is also important to update the Net Promoter Score with each analysis.
Step 6
Communicate the result to all staff sections and the score then becomes a customer care metric that all staff will be aware of.
-Your most unhappy customers are your greatest source of learning- Bill Gates
Key Points
- NPS may not be the only customer care metric in use at any one time – in some cases it is mailed out each month to customers and is not in day-to-day use.
- In the US, the scoring points are sharper – 9-10 for Promoters, 7-8 for Passives and 0-6 for Detractors. To account for Irish conditions, we have modified this slightly to account for local norms.
- The most genuine responses come from those customers who give contact information. In general, they are happy, and even appreciate and welcome, being contacted to expand on their comments. The comments from those who do not give contact information is less dependable – it should not be completely discounted but is not verifiable. Some operations put this in a separate category, and you can even develop a secondary score based on this information.
- Some customers will bypass the NPS system and go straight to Social Media – both positive and negative. This should be monitored and responded to in line with NPS procedures
-Detractors can identify or highlight process problems. This allows staff to identify process solutions- Frank Down
Managing NPS
Three key steps
- Reviewing and cataloguing the information is the first step
- Customer contact is the next step:
- If there are serious negatives, then these people should be contacted first
- If there are a number of Passives with a similar comment it is advisable to contact a representative number to expand on the view
- Promoters should be contacted to thank them for the continued support, and they should be encouraged to review the business on Social Media
- If the company operates a CRM, then the information should be recorded in the system. It is vital to have a record of the various customer categories.
-The customer’s perception is your reality- Kate Zabriskie
What NPS measures
There are four key indicators.
NPS:
- Measures the likelihood of new and repeat business
- Shows the customers’ overall relationship with your business, as well as their feelings towards your brand and product
- Shows what exactly needs to be improved or further reinforced – this can be done with the help of follow-up questions that ask why your customers would or would not recommend your business to others
- Helps identify trends and track business performance over time.
-Customer service isn’t a department, it’s a philosophy! – Shep Hyken, Customer Experience Expert
How to Improve Your NPS
- Actively listen to customer feedback and encourage Promoters while addressing the pain points identified by Detractors.
- Engage with promoters by encouraging them to leave positive reviews or refer friends to the business.
- Use NPS as a barometer of Customer Care and share the results with your staff
Customers may forget what you said but they’ll never forget how you made them feel. ~ Unknown
Advantages of NPS
In 2025 customers are being overwhelmed with lengthy questionnaires as companies try to gather large volumes of consumer data.
There are two consequences to this:
- The consumer has a lower attention span and is abandoning long surveys without completing them: the rate of abandonment rose from 23% in 2017 to 53% in 2022.
- Companies are finding it costly to analyse endless streams of data and very often it is outdated before it gets to front-line operatives. They are also finding that more data doesn’t always mean better decisions.
According to a study by Enchant, 74% of customers are only willing to answer 5 or less questions in a survey, and increasing the length of a customer survey from 3 to 4 questions can drop the completion rates by 18%.
In addition, long surveys often bypass the frontline teams—the very individuals interacting with customers on a daily basis. This disconnection results in a lack of real-time understanding of customer sentiment on the ground.
Real-time NPS feedback is the antidote to survey fatigue as short, focused questions capture immediate insights that are actionable for frontline staff.
Rob Arthur, Director of Business Development at JiffyLube made a switch from antiquated feedback collection methods to real-time NPS, and notes “Our NPS is going up and up, and it’s because we have the ability to look at, and act upon customer feedback in real time.”
The agility afforded by NPS creates a shift away from a reactive customer experience to a proactive customer experience, where you can anticipate customer needs and evolve with your customers, rather than against them.
The State of Frontline Work Survey revealed that brands who collect real-time feedback and track their ratings at both a team and individual level experience a whopping 105% increase in customer satisfaction. These happier customers stick around and refer their friends and family leading to higher levels of repeat business and referrals.
Summary
Many people see NPS as a customer care metric, but in fact it really is a business metric.
It can be used as a basic simple survey format or as a sophisticated management tool.
Companies that have made NPS part of their culture find that it is a powerful format that uses the customer to identify problems or failures in the business process and then allows the company to rectify the problem.
The consumer is tiring of long surveys and is happier with the short, focused format of NPS.
This has the advantage of giving front-line staff very clear , relevant information, rather than waiting for lengthy, and costly, data analysis.
NPS has arrived as customer friendly survey format and a cost-effective business tool.
At Customer Care Insights we have come to believe the motto: The smoother the operation, the calmer the staff and the better the customer care.
You can’t have good customer care without good operating systems and NPS is a powerful tool in both these areas.
If you would like to learn more about how to apply NPS to your business contact Frank on 087 206 1934 or frank@customer.ie
– NPS creates a view of customer loyalty. The absolute score is less important than the trend. We learn from both promoters and detractors- Jeff Immelt
