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.