Net Promoter Score (NPS)

Intermediate

Also known as: NPS

Net Promoter Score (NPS) is a measure of customer loyalty based on how likely customers are to recommend a company, product or service to others, on a scale from 0 to 10.

Customers are asked a single question: how likely are you to recommend us to a friend or colleague? Based on their answers, they are divided into three groups. Those who answer 9 or 10 are promoters, 7 or 8 are passives and 0 to 6 are detractors.

The NPS is calculated by subtracting the percentage of detractors from the percentage of promoters. Passives are counted in the total but do not affect the score directly. The result ranges from −100 to +100.

For example, if 50% of respondents are promoters, 30% are passives and 20% are detractors, the NPS is 50 minus 20, which is 30.

NPS is popular because it is simple to collect and easy to track over time. A rising score suggests customers are becoming more satisfied and loyal.

It has limitations. A single question cannot explain why customers feel the way they do, scores vary widely by industry and culture and the score can be influenced by how and when the survey is conducted. Many businesses therefore combine NPS with follow-up questions and other measures of customer experience.

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