Net Promoter Score® is a tool that measures Customer Experience. First developed by Fred Reichheld in 2003, it is now used by companies to assess and track Customer Experience. NUMR, a customer experience management (CXM) company suggests using NPS® to help derive granular and actionable CX insights.
Furthermore, in his seminal article, Reichheld declared that the ONE number that companies need to grow is not annual sales, gross profit or the bottom-line. It’s their Net promoter Score®.
Basically, Net Promoter Score® is based on just one question, which is-
“On a scale of 0 to 10, how likely are you to recommend us (product/service) to your friends and colleagues?”
Now, based on the score they give, customers are divided into 3 categories. Customers who give a score of 9 or 10 are termed Promoters. While customers who give a score of 7 or 8 are Passives. And, customers who provide a score of 6 or below are Detractors.
Net Promoter Score® is calculated by subtracting the percentage of Detractors from Promoters.
Also, read about what a Good Net Promoter Score® is, here.
In general, Net Promoter Score® provides businesses with an idea of how their customers feel about them. While, it does not calculate the percentage of people who would actually recommend a product/service, it provides an understanding of a business’s relationship with its customers.
Moreover, “word-of-mouth recommendations from friends and family are the most influential form of advertising.” Additionally, they are the most credible as well, with 84% of people stating them to be the most trustworthy.
Therefore, NUMR, a customer experience management (CXM) company believes Net Promoter Score® to be the ultimate CX metric for long term growth. (More on that, here)
Another benefit of NPS® lies in its simplicity. Since, it provides a quick overview of CX in the form of ONE number, everyone within an organization can understand it. Furthermore, it is measured regularly and can be used to track company progress over the years.
To conclude, NPS® is the ultimate CX metric and the ONE number that business should track for sustained growth.
*Net promoter Score® and NPS® are registered trademarks of Bain & Company,
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