Monday, October 3rd, 2011 by Brian Raboin in Customer Service
Net Promoter Score (NPS) was developed by Fred Reichheld in 2003 (
http://en.wikipedia.org/wiki/Net_Promoter for the history of NPS). NPS measures customer loyalty, but the power and data that can be derived from NPS goes much deeper and can have an impact at every level of your company. It tells you what in your company is working and what is not. It will focus you on “good profits” and help you move away from the temptation of “bad profits”.
Here is the NPS question, “On a scale of 0-10 how likely are you to recommend <insert company name or product> to a friend or colleague?”
Respondents are then bucketed into three groups. Promoters are those that give a score from 9-10, neutral is 8-7, detractors 0-6. The score is then calculated by taking the percentage of promoters minus the percentage of detractors. For example. If 10 people responded to an NPS survey and the scores came back as follows:
Promoters – 5
Neutral – 3
Detractors – 2
The NPS score would be 50% (Promoters) – 20% (Detractors) for a score of 30.
The follow-up question that provides the data that can be converted into action is “If you did not give us a 10, please tell us what we can do to allow you to give us a 10 in the future”
To have an effective NPS strategy, it is important that you collect data on a regular basis. …
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